TSB: The bank ‘that likes to say yes’ to digital transformation

TSB Bank's industry-leading digital transformation improved customer experience for 5M clients

Editor’s note: This interview with Scott McGarvey, head of infrastructure delivery and service operations at TSB, was originally published in Diginomica and is reprinted here with his express permission.

TSB Bank, a retail and commercial bank in the United Kingdom and a subsidiary of Sabadell Group, decided to get serious about digital transformation. So last year, it separated its systems management from the parent company and, following through on its pledge to invest £120 million to transform digital channels over the next three years, created its own IT management function and an IT centre of excellence in Edinburgh.

The changes have created better experiences for the bank’s 5 million customers, reduced costs, and streamlined its regulatory compliance.

Scott McGarvey, head of infrastructure delivery and service operations at TSB, provided some detailed insight into the TSB’s digital transformation process and the reasons, which include ServiceNow, for its success.

Why TSB turned to ServiceNow

With IBM now in charge of building and managing the bank’s private cloud environment, McGarvey said, IT is now firmly in the bank’s hands, with ServiceNow’s cloud platform playing a key role.

McGarvey said that, when TSB set up the operating model with IBM, along with the likes of BT and Rackspace, it adopted a SIAM approach, which essentially makes the bank the service integrator. As such, it was important that TSB had a platform to effectively manage its IT, with strong visibility and control.

“ServiceNow had all the capability we needed. With TSB bringing IT back in-house, we didn’t have very many tools,” McGarvey said. “ServiceNow has this enormous range of functions available, and when we choose a cloud platform it has to do as much as possible. Part of our strategy is to have fewer cloud partners that can do a lot for us.”

TSB was also able to consolidate many of the tools it already had into the ServiceNow platform, a process that will be accelerated during a phase two rollout this year, thus reducing the bank’s costs.

Accelerating time to value

TSB began its partnership with ServiceNow in August and rapidly deployed in mid-November. It went live just as IBM began running the bank’s IT, which was a leadership-led strategic priority. Doing so meant having visibility from Day One into what IBM is doing, as well as being able to integrate with them on incident, problem, and change management.

“In some respects, we had to get ServiceNow up and running [in that timeframe], and that gave us the senior sponsorship to get unstuck on certain things,” McGarvey said. “You can achieve this quickly. It comes back to staying out of the box, keeping it simple, making sure people are really educated on how to give requirements, and capturing things properly, as well as highlighting user stories.”

Making the bank more agile

One example of how TSB is using ServiceNow on a daily basis is the bank receiving integrations or requests from IBM. They are then directed to the right teams and governance boards managing the overall risk for TSB. TSB has also integrated DynaTrace, which, along with ServiceNow ITOM, helps instantly see and respond to events and alerts across the entire IT estate.

This means that within 20 minutes, if there’s a problem with an area of the digital platform, an automated incident is created with a service map, highlighting the likely parts of the business that have been affected.

“We are starting to resolve incidents in one to two hours, whereas before, the disparate nature of the systems meant that things like that could go on for hours,” McGarvey said.

TSB will be using the platform to manage the ordering of servers, or storage, which is still currently done in spreadsheets and other similar tools. However, McGarvey said he expects to use ServiceNow more in the future.

[Read also: Why banks need stronger digital foundations]

“We are in advanced discussions on various other elements of it,” he said. “For example, the infosec or security module. We’re developing that business case and we are starting a proof of concept on that. We’ve been looking again at GRC, which is the governance, risk, and compliance module. And also, the project management module, which we’re going to do a pilot on quite soon. We are actually looking at almost every module.”

Using digital transformation to boost compliance

As a financial services company, TSB is subject to complex regulatory rules and compliance to ensure the safe delivery and protection of services to customers. McGarvey said that ServiceNow has helped with this, too, as it promotes a strict common data model and enables a clear view of system stability.

“I don’t think there’s a conflict between staying out of the box and meeting the regulatory requirements,” McGarvey said. “In fact, building a really good CMDB and a really good data model helps you with regulatory requirements. The regulator wants to see it through the lens of your services. Can you map your critical suppliers? Can you point to the infrastructure and show it is in support? You would think that regulation could make it harder and more complex, but actually the more you stick to good principles, the easier it is to comply with regulation.”

Part of our strategy is to have fewer cloud partners that can do a lot for us.

Compliance also played a key role in terms of assessing the platform’s ROI, he said.

“The return on investment of this year’s business case is 11 months,” McGarvey said. “The investment committee was very happy about that, because anything that has in-year payback tends to get approved. But it was a strategic imperative to do it because we needed control and visibility.

“TSB is very keen to show the regulator that we can manage the IT and that we can prove that. After phase one, we automated 37 of our IT controls within ServiceNow, which previously took a long time to evidence every year to our auditor, to prove that we knew what was happening with change, with incident, and that root causes were being followed up on. That’s now automated all through dashboards.”

To learn about how ServiceNow is helping other financial services firms become more agile, take a look here.