The Commonwealth Bank of Australia (CBA) is renegotiating its IT outsourcing contract with EDS as it looks to implement a new business plan that will see it redirect up to $200 million of annual spending to its capital expenditure budget.
Unveiling the new strategy, CBA chief executive officer Ralph Norris told reporters that the bank was in the "advanced stages" of renegotiating its A$5bn outsourcing contract with EDS contract, which is due to expire in Mid-2007. Norris said he expected a "satisfactory" result from the negotiations.
Norris said that EDS had been good in regards to operating and managing large scale systems but cautioned that it is not an "expert in every part of the business".
The move is part of a strategy review that will see the bank augement capital expenditure to the tune of $200 million as it looks to improve customer service standards and introduce smarter technology.
CBA says it intends to manage IT as an enterprise-wide resource to ensure consistency of delivery and to achieve efficiency gains. As part of this initiative the bank has appointed Michael Harte - whose past experience at PNC and Citibank involved the implementation of business models to deliver integrated IT services - to the role of chief information officer (CIO).
The bank says it is also establishing a new customer service and sales unit which will be under the leadership of a new hire - an un-named senior executive from ASB.
CBA is also expanding its CommSee customer relationship management platform - which was developed internally - to include business banking facilities. A new Internet banking system for businesses will also be introduced. The moves are part of an attempt by the bank to claw back its business banking lending market.
In a statement, Norris says: "Our areas of strategic priority are enhancing customer service, improving business banking performance, applying smart technology and operational excellence to exploit the bank's scale advantages."