The Sillybilly Bank (TSB)…

Mainstream IT services companies wouldn’t be around today if they hadn’t learned lessons from poor delivery over the years. That doesn’t mean their delivery machinery is perfect – far from it – but it does mean they’re generally good at identifying and addressing risk. With 35 years IT delivery under the belt, the Badger’s nose still twitches when he sees, hears, or reads about IT delivery that’s gone wrong. Recently the nose twitched uncontrollably as the Badger caught up on past material about the 2018 TSB IT migration debacle and assimilated TSB’s independent review by Slaughter & May into their disastrous migration from Lloyds to their own systems. The latter has attracted lots of media comment – see, here, here, here and here, for example.

The Badger’s quietly followed the TSB debacle since it happened, labelling the bank as the ‘The Sillybilly Bank’ for the catalogue of failings. Throughout the last 18 months the Badger has always felt the debacle was unlikely to have just a single root cause. There’s been enough signals to suggest that corporate dynamics, financial pressure, poor planning, poor Go-live decision processes, lack of a solid fallback strategy, IT delivery expertise, and – as picked up in the media – poor common sense, all played a part. Future reports from the UK Banking Regulators will hopefully add more colour into the mix and provide more certainty.

In mulling things over, three impressions have come to the fore in the Badger’s mind. Firstly, that TSB’s parent Banco Sabadell – Europe’s ~36th largest bank and ~ 100th in the world – might be guilty of an ‘arrogance of acquisition, we know best’ attitude. They knew the migration was more complex than anything they’d attempted previously and they were warned in 2015 the migration budget was aggressive. Secondly, that Banco Sabadell appears keen to direct all the responsibility for the debacle onto TSB. This smacks of ‘responsibility denial‘ because Banco Sabadell must have endorsed the migration decisions and it was their own IT arm, SABIS, doing the IT. If they didn’t endorse decisions, then surely their corporate governance failed?  The third impression is that the Abilene Paradox was most likely rampant!

One recent piece of commentary neatly says ‘no one comes out of the TSB debacle smelling of roses’, and ‘the whole sorry episode is an example of how not to behave in an overseas takeover’. It’s hard to disagree. So, here’s a question. Would you trust a bank and its parent where there seems to have been governance, risk management, decision- making, and IT failures and the parent points the finger wholly at its subsidiary? You’ll have your own answer. One thing’s certain. When confidence is lost, customers overcome their lethargy and move elsewhere, which, if you look at the switching statistics, is exactly what TSB’s customers have been doing…

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