Finance, pharma companies lead FTSE 350 in IT efficiency savings, KPMG says
Financial services and pharmaceutical companies are leading the FTSE 350 in improving efficiencies, driving digital process optimisation and corporate streamlining, according to a KPMG expert.
Speaking to Sharecast in Las Vegas, USA at the ServiceNow Knowledge 15 Convention, Phil Crozier, partner in the IT advisory practice of KPMG, said: “Over the last five years companies have increasingly recognised that savings could be made across the board by developing new solutions and processes, getting workforces to adapt and move with them. Financial services and pharmaceutical companies are leading the way in that respect.”
For blue chip companies “efficiency savings” is a polite phrase for “saving money”, Crozier opined. However, the KPMG partner said it would be incorrect to assume that some of the biggest companies in the UK only view their IT estates through a cost savings prism.
“Those who do, might find themselves in a 'technical debt' and may end up spending a lot more than they would have anticipated. The concept of IT services management [or ITSM] is not new; but the innovative ways in which corporates are deploying it to make headline savings keeps evolving.”
Crozier said if the clock was turned back by five to 10 years, banks were quite arrogant about IT and failed to recognise the need to peer into how other sectors were going about achieving IT efficiencies. “At present, it’s a totally different scenario with banks having observed, and taken in talent, from other sectors. Ultimately, it all bottles down to agility and resilience - cost is ‘a’ driver, not ‘the’ driver.
“A lot of the play around the financial services sector is about how do you develop a fully resilient end-to-end IT system and the only way you can do that is by integrating services. All sectors represented on the FTSE 350 see a clear recognition that ITIL [or Information Technology Infrastructure Library] – a set of practices for ITSM that focuses on aligning IT services with the needs of business – as a structure is an industry leading framework.”
It is deployed in processes as diverse as the way investment banks manage their risk to simple HR tasks. Recognising the changing landscape, KPMG has itself gotten into the act, having partnered with ServiceNow, a market leader in ITSM, since 2011 to bring a joint IT risk management and service provision delivering bespoke solutions to clients.
"The drive to efficiency savings is a one way street. Furthermore, there are quite a few large companies who’ve scratched the surface, but could streamline and sharpen up a lot more in the years to come,” Crozier said, as the advisory firm senses an opportunity.
While a lot of the information is confidential, with the outsourcing component of digital process streamlining always proving to be touchy and controversial for companies, anecdotal evidence here at Knowledge 15 suggests many UK-listed corporates have lowered headline costs on business processes by as much as 50% in less than a decade.