European CIO Wants Barclays to Be the Google of Banks
“When people think of music, they think Apple, when they think search they think Google. We want people, when they think of banking to think Barclays,” says Anthony Watson, European CIO for Barclays Retail and Business Banking. As the interview is taking place Watson’s prophecy exists, but for all the wrong reasons, Barclays is embroiled in a highly public scandal over the setting of Libor rates. It says something of Watson, and perhaps Barclays too that the interview is taking place at all. Watson doesn’t need any PR handlers and he is a man that faces perceptions and challenges head on rather than shy from them.
Given that Barclays and Libor had been headline news for two weeks when CIO UK met Anthony Watson, the Libor issue had to be addressed and Watson, while having to represent Barclays was not afraid to tackle it.
“The process of setting of Libor estimates, and by that I mean the actual physical process, is archaic and out dated. Up to twenty contributor banks call up the BAA (British Bankers' Association) give them their daily estimated rate which is then published through Thompson Reuters. The BAA is in charge of Libor and not the BoE (Bank of England) or the FSA (Financial Services Authority) as some people believe” the technology leader says.
“An archaic process itself obviously is not an excuse. To be clear we (Barclays) were the first to settle an industry wide, global investigation. We conducted an exhaustive internal investigation over more than three years. We reviewed 22 million documents from over 200 custodian and over 1 million audio files. We at all times fully cooperated with the authorities. In total, we have invested nearly £100m to ensure that no stone has been left unturned. Our exceptional level of cooperation was expressly recorded by the authorities, and was described as “extraordinary and extensive”.
“Personally I am deeply disappointed by the impression created by these events. Remember nearly 150,000 around the world work for Barclays and literally a very small handful acted improperly. I can tell you candidly all of us at Barclays are greatly upset by these events, what our company and our people stand for could not be further from the truth. Each and every one of our people works hard every day to serve our customers and clients. A number other banks’, who have yet to be identified, have been linked to these events. It seems ironic to me that there has been such an intense focus on Barclays alone.”
Libor followed hot on the heels of the RBS outage of over a week in late June, which only piled pressure on a UK banking sector that is looked upon with great cynicism by the British public following the need for the government to financially bale the banks out. Again, the RBS outage is a topic no banking CIO can avoid.
“What happened at RBS was in real terms a unique event and from what I can tell was more to do with a failure of people and process then technology alone” Watson says. The CIO, as you’d expect, is hesitant to comment directly on a rival bank, but did of course analyse the situation at RBS and what it meant for his own operation.
“We constantly review and invest in our technology” “Constant improvement and investment in new technology ensures our platforms are more efficient, stable and more reliable,“ he says. Watson not only analysed the technology of his organisation uses, but also ensured his human assets and operational processes were not a potential issue for Barclays.”
Barclays in Europe has almost 14,000 employees with Watson providing technology to the vast majority, excluding Investment Banking, Wealth and Corporate Banking.
Watson is passionate about the role technology will play for banking and its customers.
“Banking is the most technology focused industry out there. Think about it, every transaction a bank performs is executed through technology. There are not many things you can do in a bank without technology. In fact I can't think of any! Banking, in very real terms touches people’s lives. I want to make sure everything we do at Barclays has a positive impact a person’s life, each and every time they engage with us, regardless of which channel they chose".
“As a CIO I want to work with the business in a technology led transformative fashion. Technology will enable our vision of becoming the “Go to Bank”,” he says. Watson cites JP Morgan Chase & Co Chairman & CEO Jamie Dimon and Steve Jobs former CEO of Apple as both a business and technology inspirations for the young CIO.
“We want to transform the experience at every channel and every place the customers are at. We have realised that the banking experience can be so much better. So we are working on making our products and services transparent, seamless, attractive and simple to use”.
“Banking has a tradition of making things very complex. Basically what a customer wants is real time and seamless banking that’s channel independent,” Watson says of the vision since joining Barclays almost three years ago.
“Barclays has a rich history of innovation; we were the first to use ATMs, the first to offer a plastic credit card, I want to build on that rich legacy.”
Watson is enthusiastic for recent Barclays innovations including Pingit a mobile payments system.
“The feedback we have had around Pingit in the media and on Twitter was amazing, we were in the top spot for a while with that launch, only porn stars get that sort of traffic twitter,” he quips.
When banks talk technology there are plenty in society who fear it means branch closures.
“When customers talk about losing branches what they really mean is losing a physically connection with another person. We are looking at launching products and services to build on this experience, we are not looking at closing branches if it is not in the best interests of our customers,” he says, adding that Barclays is looking for ways to enable its bankers to physically go to the customer to transform the banking experience.
“Devices are becoming more mobile, but our strategy is not mobile for mobile sake, it’s about seamless service” he says of the recent mobile and online developments launched by Barclays across Europe.
As with any organisation in the current economy Barclays is looking to rationalise and become more efficient and Watsons explains it crosses front and back ends of the massive banking corporation.
“We have core, integrated back end platforms where it makes sense, such as an enterprise payments platform. We did an optimisation plan when I joined three years ago to transform our legacy and move to a more integrated and virtualised environment. We use a utility based approach to infrastructure that I would akin to a “ plug and play” model that allows us to move with significant speed,” he says.
Watson describes Barclays infrastructure as a utility model and the CIO doesn’t have much truck with the cloud hype created by marketing types, he brushes off the hype that most players offer as “big server farms” rebranded as something they are not. He notes banks like Barclays have had large estates like these in the past and have moved on from that legacy. Barclays have an infrastructure shop offering utility computing across the entire global organisation.
“Our infrastructure organisation is lead by Peter Josse, he leads infrastructure for the entire Bank.”
“The thing that most industries have not got right, including banking, is the call centre. For a lot of people they are a hideous experience, it just turns people off. We want to change that, it doesn’t make for a fluid experience or simple and engaged conversation,” the CIO says.
To tackle and enhance the customer experience, Barclays has begun a relationship with SatMap (www.satmapinc.com). SatMap is an intelligent call routing technology that uses highly sophisticated analytics that profiles both agent and customer data to enhance and evolve the call experience. “Our customers now speak to people they have an affinity with, thus enjoy the conversation much, much more and our agents feel the very same. What’s not to love, our agent attrition rates have dropped, our training costs have gone down and our customers engagement and satisfaction has gone up - everybody wins."
“Lets be honest, call centre work is a pretty tough job, so by using technology to help our people and our customers we win on lots of fronts,” he says. Barclays has a global footprint of call centres. While Watson believes the location of call centre is critical, its less important for a mature organisation if they are outsourced or not, it is the technology that supports the call centre worker and therefore the customer, if that’s not done right lets everything down.
Watson deployed SatMap, for his previous employer Wells Fargo, where he was Senior Vice President & Global Head of Technology Services for the Bank.
At Barclays Watson reports to the COO of Europe at Barclays, Matt Chung. Watson has twelve direct reports, each of the European countries has a CIO reporting in to him, while Watson also has within his department a COO, CFO, a Chief Digital Officer, a Chief Architect, a head of projects & programmes as well as head of strategy and planning. Watson sits on the European Operating Committee for Barclays and is also an advisor to the boards of several companies outside of Barclays.
Watson has spent the bulk of his career in the banking sector and sees no reason for that to change, but quips “For me its important that I have impact, I want to change things for the better – for customers, employees and shareholders – I’ll work in whatever industry allows me to do that. I need to feel I make a difference on a daily basis and add demonstrable value where I work“. There are observers that constantly question why so few CIOs have become CEOs of organisations. It’s not a debate this title cares much for, but Watson is one of the few CIOs I felt compelled to ask whether he believes CIOs could become CEOs and in particular in the banking sector. Unsurprisingly, he believes they can and reminds me that once Bob Diamond had an IT career. With a tech focused COO and banks rivalling the IT industry for pushing the boundaries of technology potential, he just might be right and he may well be the one that makes the grade.
Bankers and banking employees have long held a reputation for being hollow chested and dull. They sit up there with accountants and actuaries for greyness. Anthony Watson is a passionate and animated character and tells a very different story of life at Barclays bank.
Watson is openly gay and was recently voted in the Guardian newspaper 56th most influential gay person in the world alongside Tim Cook, Apple CEO, Elio Di Rupo, Prime Minister of Belgium and Lord Browne the former CEO of BP. Diversity is important to Watson.
"Barclays is an inclusive culture, it’s a great place to work but we have a lot more to do," he says. "Not all our customers are the same. After all, not all of our customers will be pale, male and stale." Watson sits on the Barclays diversity panel as co-chair.
Watson was no doubt recognised by the Guardian for his efforts to not only be open about homosexuality, but also the campaigning he does on behalf of gay and lesbian youth in the UK.
"It's important that people see that you can be a successful executive and gay," he talks of breaking down the sometimes self imposed or stereotypical glass ceilings gay men and women face of thinking they'll only get work in a typical “gay” job like a hairdresser or air steward.
"It's very important to not get boxed in. We have a lot of work to do fighting bullying and homophobia and for me it is important to give back to the community," he says.
Lord Browne, the former CEO of oil firm BP is a hero of Watson's, but the Barclays man doesn't wish to hide his homosexuality the way Browne did for the majority of his career.
"I wanted to be true to me, I want to true to my friends, my family and my work colleagues. To be an authentic leader you have to be honest with yourself and the people around you. The people I have on my team have to trust me, trust only comes from respect and you can’t respect someone who isn’t open and honest. After all I am only as good as my team."
Working with a number of gay rights and charity organisations Watson goes out to secondary schools every quarter to "have an open dialogue with teachers and young people". Watson visits schools in the UK to offer advice and guidance to both students and teachers in challenging homophobic bullying and celebrating diversity and difference.
"Young people come up to you to talk about bullying and they are thankful to someone who understands them, has come through the same challenges they have and then has gone on to be successful executive ”.