Russian Bank: Lean Transformation of IT Group

Accenture helped this large Russian bank use Lean techniques to transform its IT department as part of a far-reaching strategic transformation on the road to achieving high performance.

This large, conservative bank wanted to become more agile and competitive to retain and attract more sophisticated and younger urban customers. To stand out in an increasingly competitive business environment, it planned to offer convenient, faster banking services driven by innovative information and communications technologies.

The bank’s leadership team understood the challenge ahead and approved a development strategy with numerous goals to be achieved by 2014, including technology innovation, a client-focused business model and radical improvements in operational efficiency. The size of the organization made orchestrating cultural change difficult.

For example, the bank’s IT organization had more than 5,000 members, yet felt overwhelmed by requests for new projects. The IT organization needed more effective ways to prioritize requests; work with greater speed to deliver new functionality integrated with other IT applications; and coordinate the release of innovation across widely dispersed bank operations.

The bank sought assistance from an experienced service provider with demonstrated strengths in Lean transformation. Senior executives chose Accenture over several competing providers. Accenture was selected due to previous project experience in Lean Six Sigma, deep knowledge of IT processes and readiness to combine local consultants with international experts, who could customize their international experiences to address challenges faced by the Russian bank.

Accenture began by involving the client in analyzing key issues to support the case for change. Accenture suggested two work streams: one focused on generating early tangible outcomes and the other building the infrastructure for Lean IT program implementation at regional branches.

Teams in the first work stream analyzed 10 processes suggested by the client. This analysis led team members to suggest more than 100 improvement ideas.

For the pilot implementation, the client narrowed the focus to two core processes: application release management and capacity management.

Lean tools such as value stream mapping helped reveal non-value-added activities and the root causes of persistent delays. Using Lean techniques and drawing on Accenture experience transforming complex IT processes, the project team piloted the newly streamlined processes at the bank’s headquarters.

The second work stream began by agreeing on key requirements to set up a sustainable program to introduce Lean IT at bank branches. The program included a governance model, description of roles and a road map to guide implementations. Accenture brought in master black belts experienced in Lean IT, along with additional IT professionals to work with client team members in meetings and workshops.

The client team produced models for governance and performance management, and agreed on an organizational structure, all of which were needed to implement Lean IT throughout the organization.

Training materials and a communication plan were added to build internal capabilities. Through knowledge transfer and coaching, Accenture helped the client develop new capabilities in Lean IT.

Setting a swift pace for change, Accenture and the client delivered impressive proof in two key areas—release management and capacity management—in only four months.

At very large organizations, seemingly small improvements in suboptimal processes can lead to major financial savings. In application release management, for example, improved process flows with decreased project delays let the bank reduce lost sales opportunity by €25 million ($32.8 million). The IT organization has demonstrated a 20 percent-improved capacity to increase the number of application changes delivered on time without increased resources. These developments are critically important in a competitive banking environment where a growing number of consumers expect innovation and convenience at their fingertips.

In capacity management, expected load testing accuracy has increased by 71 percent, which will result in better systems utilization and, in the long run, savings in IT hardware costs. The time required for data preparation has declined by 50 percent. At the same time, the amount of useful test data has been increased exponentially. A new planning tool and related procedure for load testing are expected to greatly accelerate project-execution timelines.

Infrastructure setup and a defined deployment plan have set the organization on a multiyear path of Lean transformation. Productive collaboration between Accenture and the bank has paved the road to high performance.