Dark Clouds Over IBM?

All Members

Last year Lloyds Bank announced it was outsourcing 1,900 jobs to IBM. A significant number of the jobs transferred to IBM will eventually be offshored to India. IBM and Lloyds signed one of the largest cloud transformation deals with most staff working in Infrastructure Technology Services moving to ‘Big Blue’. The teams that moved to IBM included those working with Linux, Windows X86, UNIX and iSeries.

Morteza Mahjour, Group Chief Information Officer, said at the time:

“As customer demands change and innovation in the industry gathers pace, having a more modern and agile technology platform will help us lay the foundation for the next phase of our strategy.”

Stirring words, although he didn’t stick around long enough to see what happened next.

At the time of the announcement we reported that Senior Managers and Heads of Functions had outlined significant concerns but those were ignored, with the comment that “people at LBG are averse to change”. It would appear that the Luddites were right to be concerned. The new relationship between ‘Big Blue’ and Lloyds is not all sweetness and light. According to members involved in managing the contract and those who deal with IBM, there are severe strains in the relationship. Rather than making the change process quicker, which was one of the reasons for the outsourcing in the first place, getting work done and projects finished now is much slower, with a level of bureaucracy that never existed before the IBM deal. 

IBM won’t do any work now until it’s received a ‘Statement of Work’ document setting out exactly what needs to be done and the agreed timescale in which it will be completed. That’s not unreasonable but any deviation from that document, however slight, requires a further ‘Statement of Work’. It’s the opposite of agile working and we’re told is slowing things down considerably.

What’s ironic is that the two senior executives responsible for delivering the outsourcing deal – Jacqueline Guichelaar-Fauvel, ex-CIO of Infrastructure and Services and Morteza Mahjour – left Lloyds before the ink was dry on the outsourcing deal. If the Bank walks away from the IBM deal, assuming that’s possible under the agreement, then it’s the ex-Lloyds staff we are worried about because they will be left high and dry. We’d like to hear from members about their experiences of using IBM.

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