Barclays Consolidating Various Silos To Cut Costs
Barclays Bank, the UKÆs third-largest financial institution, is to bring its standalone IT division back in-house in an effort to consolidate legacy silos and eliminate duplication under its cost-cutting strategy. Trade union Amicus Unifi has criticized Barclays for its aggressive pace of restructuring, but the bank argues that its tight timeframe will more quickly free up savings for reinvestment in front-line services. This month, the merging of æEnableÆ, BarclaysÆ main IT division, with its UK operations, is scheduled to begin under the bankÆs strategy to reduce its cost/income ratio by two per cent over the next three years.Restructuring will begin in BarclaysÆ Business Process Unit as part of the bankÆs wider move to streamline operations by realigning its IT functions with its business strategy. A separate IT unit, CIO, will be retained to oversee BarclaysÆ core IT system and strategy across its global operations. Centralizing IT functions within an organization achieves cost savings by reducing headcount, improving economies of scale and standardizing technology. In a survey of 510 European firms, Forrester Research found 54 per cent of UK firms to operate centralized IT systems, while 36 per cent used centralized and decentralized models. Related Links:
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