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back to article Half the team at the heart of the RBS disaster WERE in India

Cost-cutting RBS management had halved the team within which the banking group's recent data disaster happened, sources have told The Register. The sacked British employees were replaced by staff in India, and there had been concerns about the quality of the work done in India for a lengthy period prior to last week's …

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Beware of the weasel

"The management and execution of batch processing is carried out in Edinburgh"

Yes, I'm sure the actual execution of the code took place on a computer located in Edinburgh. And there's probably a manager for the process in Edinburgh, too (he'll be the poor sod with red eyes who's just got back after a 12-hour flight from Chandigarh). But the question that has not been answered is whether the staff who actually made the changes and cocked it all up were in Edinburgh. I wonder why that would be?

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Anonymous Coward

Re: Beware of the weasel

I guess you could say that the management are the SysOps, all based in Edi, unless they've gone too since I left.

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Re: Beware of the weasel

Or indeed the statement -

"The management and execution of the batch process is based in Edinburgh at Fettes Row, as is all the current work to resolve the problem." From yesterdays Guardian Q&A.

Which was part of an answer to a question about Indian involvement with the bank problems. Note the use of the word 'current'. So it is just possible that there was some work that wasn't undertaken by staff located at either 'Fettes Row', Edinburgh, or Scotland? Who knows.

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Re: Beware of the weasel

There do seem to be some definitive statements in this one -

http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/offshoring-blamed-for-rbs-onshore-glitch-bank-clarifies-fault-was-local/articleshow/14447599.cms

It would seem 'The unsubstantiated allegations, denied by RBS, reprise a familiar pattern of noise against offshore outsourcing from developed nations to India.'. Also this has happened at a delicate moment when the Indian Outsourcing business is being hampered by slow growth.

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Anonymous Coward

Re: Beware of the weasel

There may be no evidence (yet) for it being a mistake by an outsourced third party, but there's no evidence that it was the onshore team either. RBS aren't saying, even though they certainly know. As they know, you'd think that they would say "here's the proof it wasn't due to outsourcing" if it wasn't, but they aren't, hence the reasonable assumption that they are trying to cover up what happened.

For the benefit of any Indian readers, the hostility towards low paid Indian contractors is based on the fact that an awful lot of us are losing our livelihoods by our jobs being moved to dirt-cheap developing countries (where the quality of the code/support is piss-poor), whereas such a move would be illegal if they did it wholly within the UK.

In other words, they're putting us out of work to save money in the short term, then when it goes wrong they are trying to pretend it was nothing to do with their stupid and short-sighted decision to use outsourcing.

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Anonymous Coward

Re: Beware of the weasel

Upgrades such as this taking several months of planning and involve technical resources and managers from several teams. So while the actual button monkey may have been in Edinburgh on this occasion, the Schedule of Events will have been worked on by multiple people in multiple locations with potentially varying degrees of diligence.

Even if the diligence was good on the implementation planning, the backout planning either lacked some detail or was poorly followed.

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Anonymous Coward

Re: Beware of the weasel

The RBS SysOps are based at Fettes Row, as are (were) large proportions of the IT staff. In my more than five years at the bank, I never knew the sysops to take part in an upgrade or recovery of any software, except for a few secondary activities, such as stopping batches running, starting them again, etc.

It is possible that the upgrade/downgrade work was done from the same building by others, of course.

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FAIL

Re: Beware of the weasel

I find the, albeit circumstantial evidence, in the phrasing of the denials that outsourcing wasn't to blame makes me tend to think that the opposite is the truth, and caused at least part of the problem.

Also the continuous mantra that it is all hands to the pumps to fix the problem. I mean this problem happened getting on for two weeks ago, and RBS have stated that it is 'mainly fixed'. How can they make that statement without having a good grasp (names, places and so on) of what happened in the first place. Either they really are that bad (*) at management, or by now they must know what happened.

If the failure was caused by a poorly trained CA7 operator in either of Edinburgh or India surely they must know? If nothing else part and parcel of the fix should be ensuring that this operator, and anybody else with a similar level of training, should by now be sitting in a classroom. At least as an absolute minimum these folks should be nowhere near a keyboard connected to the live systems.

(*) for 'bad' above read appalling, intelligence of pond weed etc etc.

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Weasel II

The other weasel claim is that 'these were not outsourced staff'. This could be true - if the operation were jointly owned by Infosys and RBS, senior management could claim that they were still RBS staff, just based overseas. The interesting question would be: "did you get rid of most/all of your experienced staff who knew how this software worked and were deeply familiar with the intricacies of your bespoke systems and replace them with the cheapest option you could find?". Whether the result of this was staff based in Chandigarh or Auchtermuchty is irrelevant to the discussion.

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@ Chris Miller

RBS are correct in saying it had nothing to so with outsourcing as they effectively stopped using that route (networks to Accenture excepted) at least 3 years ago. Instead they started their own IT centre in Gurgoan (near Delhi), so strictly speaking most the offsore staff are RBS and those who aren't are cotnractors working for RBS TSI.

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Re: Beware of the weasel

@AC 13:11 GMT

> Racist

Would like to qualify that comment? Nothing I have said to my mind is 'racist' ?

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Re: Beware of the weasel

The one thing that this proves (whatever else it may highlight) is that the "Directorati" are so fucking ignorant that they do not understand that (in modern industry, whichever type of industry it is) you cannot cut IT support in the same way that you can (if you are very bloody careful) in other areas of your business. The domino effect of the wrong decision in that area of your activities can have utterly disastrous effects - as we are now seeing.

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Devil

Re: Beware of the weasel

Agreed with you on facts re timing, but why not spin out the "we're helping our customers, no time for pointing fingers" excuse as long as even the press will take it?

Perhaps the furor will die down by itself and the "managers" can breathe a sigh of relief and get on with cost cutting as usual....

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Coat

Re: Beware of the weasel

Don't talk to your mind. It might get ideas.

Otherwise, couldn't find anything racist either...

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Re: Beware of the weasel

"Never believe anything until it has been officially denied". - Claud Cockburn

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Unhappy

Who is the downvoter?

Anyone else noticed the single (sometimes double) downvote theme here? Odd... well, not really - someone has obviously mistaken the outrage and concern for raging xenophobia.

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xenophobic witch hunt

Half the team were in India.

So half the team were in Blighty then. What were they doing?

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@AC 12:13 Re: Beware of the weasel

Downvote for not reading the article - its NOT outsourcing, its off-shoring. Subtle difference, but different none the less. The rest is pretty spot on though!

Mines the one with the "thanks for all your years of service, now get back to training your off shore replacement." card.

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Re: @ Chris Miller

This job advert supports that:

http://jobsearch.naukri.com/job-listings-Batch-Analyst-RBS-India-Development-Centre-P-Ltd--Chennai-Delhi-NCR-5-to-10-years-160112001195

However they try to wriggle out of it, though, RBS sacked experienced people in the UK and gave the work to cheap labourers in India.

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Anonymous Coward

Re: Beware of the weasel

I can confirm from personal experience when I used to work there, that work from their TSI branch is often of shocking quality. One 'resource' we were allocated didn't even speak English past a level so basic that we couldn't use him at all. Supplied work in other areas was patchy at best and took as long for local staff to review and/or fix as it would have taken for them to do in the first place. The pattern of failure and cover up permeates the business at this point. When these failures are investigated the situation gets wrapped up into ping-pong style discussions and eventual denial that there's a problem, or yet more control processes that result in no change at all.

They're starting to learn that you can't run a large IT estate properly when you get rid of all your staff.

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India v China

I thought all (most) IT jobs were being outsourced to China rather than India ?

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Anonymous Coward

Re: India v China

No and certainly not for banks. RBS did have some dealings with Bank of China, but the servers ran from Singapore because it's fairly well known that half the staff of BoC are actually government staff, if you see what I'm getting at...

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Re: India v China

Too difficult with the great fire wall and some rather stringent data rules

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Alert

A couple of typos Anna

1) This created the backlog [that] has taken so long to clear.

2( because he [had] been loyal to the company for years

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Re: A couple of typos Anna

*2) ...the irony ;)

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Facepalm

Re: A couple of typos Anna

Re: A couple of typos[,] Anna

Now, why would I be thinking of glass houses this fine morning?

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Anonymous Coward

Re: A couple of typos Anna

Nothing wrong with pointing them out, although nowadays I believe there is a separate link for that.

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RBS Management

On a personally level I would think long and hard either if I was an existing customer, or thinking about, banking with RBS.

Also on a personally level I have always wondered why the management of organisations such as RBS ignore the advice of IT staff on these sort of issues.

http://www.channel4.com/news/rbs-warned-of-it-outsourcing-risk-in-2010

As a tax payer (and assuming the lot of them don't end up in prison for manipulating LIBOR) the management of RBS have a lot of explaining.

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Re: RBS Management

It's fairly simple - they ignore warnings from a self interest group about doing something which may damage that group. There doesn't seem to be thinking that the professional staff in that group may know what they're talking about.

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Re: RBS Management

Because come hell or highwater the head of IT was going to reduce the staff costs. And he based that decision on the fact that UK workers cost x and India workers cost y. And because Y is about 1/4 the cost of X that made perfect sense. They both do the same job after all. Anyone can be taught to programme, anyone can be taught to run a batch schedule. and so on.

By reducing staff costs he would have been seen to have made a massive dent in expenditure and would no doubt have given him a nice leg up in his accent to the boardroom and his bonus is very likely to be linked to cost reduction and increased output. Manday cost were about £400 for a UK and about 1/4 of that for non-uk workers. Imagine reducing your costs by 75% and with ZERO impact on your business. What could possibly go wrong.*cough*

I am sure that execs rationalise the negative internal comments by linking them to the UK staff fear for their jobs. So anyone that suggests the outsourcing is a bad idea either gets sidelined or kicked out early.

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Re: RBS Management

"They both do the same job after all. Anyone can be taught to programme, anyone can be taught to run a batch schedule. and so on."

The biggest irony of management thinking in banks is that any monkey can be taught to fuck up and lose millions too, yet only IT people get outsourced/offshored.

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FAIL

Re: ...anyone that suggests the outsourcing is a bad idea..

BUT, if you do 'write them off as `in fear for their jobs`'; and it turns out that they were indeed 'correct'; then how do you explain a clusterfuck like this one?

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Anonymous Coward

Re: RBS Management

I don't know how the financial picture looks in the UK, but in the US the financial case for outsourcing has a ton of caveats and asterisks attached. 15 years ago the financial case for outsourcing to India was obvious (financial case, morality and national interest aside). Over the last five years, the salaries for IT and engineers have been increasing by 20% per year in India while the US rates have basically been stagnate or decreasing. The current predictions, which were cautious, from the BLS are that it will be more costly, in raw terms, to hire an Indian programmer than a US programmer by 2017. That does not factor in the high overhead on outsourcing contracts, such as sales, PM, various liaisons which are for some reason required, travel, government costs, administration, communication tech, etc.

The other headwind against outsourcing in the US, and even more so in Europe, is that the currencies are still strong vs. Rupee. That should swing in the other direction pretty furiously as the Chinese, and to a lesser extent, the Indians have been sterilizing their currency by parking their profits in US treasuries. They cannot go on parking their profits in US treasuries until the end of time... eventually they are going to get concerned that the US cannot pay it off, even with the US's giant economy. When they have to start spending their cash in non-dollar denominated bonds (e.g. buying stuff), the Eastern currencies will rise substantially and the export led economies will lose their cost advantage. It has to happen... It is getting very close to the end of offshoring, at least in India. The corporations have, of course, been going to even weaker economies such as the Philippines and China, but they do not have the talent or educational system that India has and the same principles apply. The Western governments and populations, with the exceptions at top, are flat out broke. When one group of people has all of the money and another group of people has none, the group with none cannot go on buying stuff from the group with all the money on credit from the group with all the money ad infinitum.

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Re: ...anyone that suggests the outsourcing is a bad idea..

"BUT, if you do 'write them off as `in fear for their jobs`'; and it turns out that they were indeed 'correct'; then how do you explain a clusterfuck like this one?"

Coincidence

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Re: RBS Management

Or in the case of JPMC Billions...

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Go

One, two, three, jump! But where?

Are any of the other banks any better? Do any of them have well managed IT departments staffed by long-term, experienced people? (UK or India or wherever)

Where should a RBS customer take their overdraft?

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Re: One, two, three, jump! But where?

We moved to Nationwide about 2 years ago (OK it's a Building Society not a bank, who cares). Very helpful service, transitioning the account went soothly with frequent progess reports, and absolutely no problems since then.

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Re: One, two, three, jump! But where?

Should have mentioned, we had previously banked with RBS for about 25 years.

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Who cares ?

Well, because it's a building society, it's only shareholders are *you*.

Given that Nationwide appear to have charted their way through the credit crunch with no fuss at all (possibly because they can't play fast and loose with *members* cash, unlike a bank) I would say it matters a great deal.

We moved to Nationwide after HBOS messed us around - can't fault them so far. Pleased we also have our mortgage with them.

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Re: One, two, three, jump! But where?

I too jumped from Natwest who I had been with for over 50 years only about 3 months ago. I too went to Nationwide who have been perfect so far. They even have somebody in the bank I can go and talk to, unlike Natwest where every contact seems to have to go via a call centre. The whole Natwest "customer care" system which involved 4 months of mucking me around for a simple change of account name got me so livid I moved. And now I get free travel insurance too! Well done Natwest, you have save me about £100 a year on that one. Idiots!

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Re: One, two, three, jump! But where?

Nationwide. That would be the bunch of asshats that stranded me on the wrong side of the world with no money because of an 'inputting error' 'Yes sir, I apreciate you are in the middle of no-where* and need to buy fuel with the money in your account but it will be at least 3 days to get it sorted'

LLoyds have been allright for us thus far. Seems the ones to really stay away from WERE Halicraps and HSBC, the list seems to be growing at an alarming rate...

* North Carolina, its scary out there.

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Re: One, two, three, jump! But where?

I'm not a Nationwide fanboi - all service providers can screw up.

But at least, with Nationwide, you can be guaranteed that anything done to benefit the shareholders will benefit you, since you are the one at the same.

At the end of the day, HSBC, HBOS, RBS, Lloyds, Barclays et al have to keep the sahreholders happy - and damn the customers.

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Re: One, two, three, jump! But where?

Nationwide??? The company who has already outsourced the support of their main banking engine to India, and is working to outsource as much of the rest of their systems as well? The company who has spent hundreds of millions of pounds on a replacement banking engine based on SAP to replace their old legacy system, but finds it still can't do all the processes so the old system still does a lot of the work (and the SAP system still doesn't work yet)? Good luck with them.

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Anonymous Coward

Re: One, two, three, jump! But where?

Lloyds? As in Lloyds TSB?

The bank where "for the journey" actually means a nice smooth straight middle class path, and not a graduate path on a low salary saddled with debt, with them sending out threatening letters?

They can go jump.

They're all as bad as each other.

RBS/Ulster Bank seemed to believe a student account meant a basic upgrade from a Henry Hippo account. No cheque book to pay rent, no debit card to buy books off amazon. "Computer says no" type of staff.

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Anonymous Coward

Re: One, two, three, jump! But where?

My Dad had continual problems with RBS - has now closed all his accounts. Personally I never used them, lots of organisations have a lot of problems stored up for the future - hopefully RBS off-shoring blunder will make others think twice about risking core-systems.

I bank with FirstDirect whose systems are all based out of Leeds and AFAIK managed from there too - FD's telephone-based customer service is 2nd to none. My simple re-payment Mortgage (almost paid off 10yrs early - how's your endowment doing?) is with the Derbyshire / Nationwide BS because as a Building Society they work in my interests -not- the shareholders (like ALL banks).

Remember only your first £85K savings (£170K for a joint account) is guaranteed per institution and RBS is made up of lots of familiar names http://opencorporates.com/corporate_groupings/royal%20bank%20of%20scotland

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Re: One, two, three, jump! But where?

"But at least, with Nationwide, you can be guaranteed that anything done to benefit the shareholders will benefit you"

Yeah, but who says they're interested in benefits for the shareholders:

http://blogs.thisismoney.co.uk/2010/06/vote-against-nationwide-bumper-pay-packets.html

I had a bank account, credit card and mortgage with Nationwide this time last year and they managed to cock 2 of those up, now I've closed them all.

Mortgage was on a rented out house I wanted to change the terms on, I went to great lengths to ensure it was ok, talked to many people in many departments and on the day of change I was told it wasn't possible - as the house was rented out. Their excuse? The guy was new. A different guy in every department I spoke to was new?...

They dropped my credit limit to £500 on the credit card. No one would say why, made many complaints and got nowhere. I paid the balance off completely every month without fail for years. My credit rating was perfect, in fact I took out a Halifax card in replacement and got a £12,000 limit.

Not to mention dropping their commission free foreign currency withdrawals...

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Anonymous Coward

Re: One, two, three, jump! But where?

Always Co-operative Bank... no Share Holders.

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Re: One, two, three, jump! But where?

I second the call to go to First Direct. OK so, yes, they're officially part of HSBC but they're managed independently. I doubt that'd help much if this kind of midden hits the windmill but their day-to-day interaction just works. The phones are answered by a real person - in the UK - and that one person can deal with 90% of things without having to transfer you.

I'm one of those rare types who does actually move my account between banks - I've tried them all at some point - and only FD have managed to keep this awkward cuss impressed over a long haul.

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Re: One, two, three, jump! But where?

"Are any of the other banks any better?"

To the best of my knowledge, no.

Barclays? Hahahahahahahahahahahahahahaha.

Lloyds/Halifax/Bank of Scotland? I have been a BoS customer for decades - since it was a proper bank, in fact - and I too have been asking "are any of the other banks any better?" Clue: when I instructed them to pay off the balance of my mortgage without fail on a certain day, they failed to do so. So then I reminded them, and next day they paid it twice. Then they sent me a letter telling me I was overdrawn, "perhaps through some oversight".

Santander? One word: "Spain".

HSBC? Maybe one can trust the Chinese.

I think you will find that all the banks, and other financial institutions, have found ways of offering equally abysmal service to customers. There is no escape.

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