Lloyds TSB Group: IT Transformation and Optimization

Realizing that the effort to improve its IT capabilities would require faster, deeper change than it could manage in-house, Lloyds TSB partnered with Accenture to create an IT competency that aligns IT delivery with the bank’s strategic priorities. Processes, tools and methodologies were brought closer to best practise, and the skills and experience of IT staff were improved.

Client Background
Lloyds TSB Group is a leading financial services organization based in the United Kingdom. With nearly 80,000 employees, 16 million customers and assets of more than £250 billion (US$460 billion), Lloyds TSB offers a comprehensive range of banking and financial services.

For the bank to maintain its market leadership position and maximize shareholder value in a fiercely competitive market, IT performance is crucial. “We want to prove that technology can differentiate the bank in the eyes of our customers and investors” says Igor Andronov, director of Group IT. This vision was the fundamental rationale behind the decision to embark on a far-reaching transformational change program.

While external benchmarking indicated that Lloyds TSB’s IT performance was in line with that of its main competitors, Group IT recognized room for improvement in a number of areas. Realizing that the effort to improve its IT capabilities would require faster, deeper change than Group IT could manage, Lloyds TSB set out to find an external partner that could help: transform the culture of Group IT, improve the skills and experience of Group IT’s people, bring Group IT’s processes, tools and methodologies closer to best practice and improve the way that IT and the business work together.

Accenture was selected based on its industry skills and experience in executing significant transformation programs. The ensuing five-year transformation program has been designed to help Group IT make a step change in the way that service is delivered to the business. The structured approach to transformation facilitates this and above all enables Group IT to become a high-performance organization and help drive competitive advantage for the bank.

In spring 2003, Accenture rapidly mobilized a team to help Group IT implement a new operating model. The reorganization was the first significant step towards changing the way Group IT worked internally and was interfaced to the broader business. The main components of this operating model include: 1) strengthening the business/IT relationship to improve effectiveness and execution; 2) organizing application development and management into separate areas of focus; 3) implementing a comprehensive service improvement plan; 4) establishing a new chief operating office responsible for Group IT commercial and operating performance; 5) transforming and standardizing the merged areas of finance and business performance to create a more customer-focused department; and 6) driving the creation of a high-performance workforce through a stronger focus on more rigorous performance management processes and skills training.

With Accenture’s help, Lloyds TSB’s Group IT is making significant progress toward creating a high-performance IT environment that aligns IT delivery with the bank’s strategic priorities. Currently in year three of the five-year program, the Accenture/Group IT team is confident that the Improving IT initiative will help Lloyds TSB create a high-performance business propelled by consistent increases in customer satisfaction and competitive differentiation.