by Leo King

Barclays drop Accenture in favour of in house development

Jan 11, 2010
Financial Services IndustryIT StrategyMobile Apps

Barlcayswill not renew a £400 million, six-year application development deal with supplier Accenture.

The bank said the decision had been made for “commercial reasons” but declined to explain further. The move follows a decision to move desktop PC management back in-house, ending a deal with Getronics.

Accenture said it will continue to act as a “consulting and solutions services” supplier to Barclays, but also refused to give details of this work.

Two hundred and thirty staff will move from Accenture to Barclays, after the contract expires on 30 June. This number is far smaller than the 900 Barclays staff who moved from the bank to the supplier during the year after the deal was signed in mid-2004.

The six year deal also covered management of its commercial and retail banking systems, but excluded investment banking and asset management operations at Barclays Capital and Barclays Global Investors.

Barclays said that moving application development in-house would give it the “most efficient model” for the work. But at the time the deal was signed, it highlighted outsourcing as a better route to more flexibility and lower costs.

The decision not to renew the deal had been “mutually agreed” by the bank and the supplier, Accenture said.

Meanwhile, Barclays’ systems have been in the spotlight for the wrong reasons, after an unexplained system crash in October knocked offline its cash machines, in-branch banking systems and internet banking for a number of hours. The problem followed other high-profile online banking crashes in prior months.

The bank is extensively cutting its IT workforce as it attempts to reduce costs. Last May, it emerged that the bank would cut 700 IT staff by the end of the year, reportedly offshoring work to Singapore, Hungary and India.