back to article Santander hands over $700m to IBM in hopes of becoming incredible banking machine

Santander is locked, loaded and ready to fire the cash gun at IBM in an effort to speed the bank's jaunt towards the cloud. The five-year deal will see Santander spank $700m to get its hands on IBM's tech, including AI smarts in the form of IBM Watson, which will be, er, put to work "enhancing branch advisors' expertise" and …

  1. Flywheel Silver badge

    expecting IT savings

    Blimey, they never learn, do they? I'm waiting for Watson to utter those immortal words "I'm sorry Dave, I'm afraid I can't do that"

  2. cookieMonster

    Chaos....

    Yep, sounds about right....

  3. Steve K Silver badge

    David Chaos

    "The global CIO of the group, David Chaos"

    Let's see if this ends well... Either way the Reg headlines will be "Chaos rules supreme!"

    Must have been an interesting call with the headhunters when he was found.

    1. Gomez Adams

      Re: David Chaos

      Having a Dave Chaos in charge reminds of when the old Abbey had a guy in charge of bed and breakfasting cash overnight on the stock exchange called Dave Gamble! :)

  4. Pete 2

    In a branch? Out on a limb!

    > IBM Watson, which will be, er, put to work "enhancing branch advisors' expertise" and increasing productivity.

    > That is one of the aims at least, assuming UK customers can actually find a branch,

    Surely the point will be that an AI doesn't need a branch. It just inhabits the web. So potential customers will just see an avatar that doles out vague advice and then tells people to buy Santander products. Your financial adviser will just be an app on your phone.

    1. Anonymous Coward
      Anonymous Coward

      Re: In a branch? Out on a limb!

      "Surely the point will be that an AI doesn't need a branch."

      Surely Watson needs a branch to play punters in chess?

    2. deevee

      Re: In a branch? Out on a limb!

      Well, about the only thing that could possibly improve, would be if Watson replaces the Indian call centre workers.

      Otherwise With cost blowouts, they'll end up paying $2b and still have nothing to show for it.

  5. Anonymous Coward
    Anonymous Coward

    The old quote

    "A fool and his money"

    1. MiguelC Silver badge

      Re: The old quote

      or, in this case, a fool and stockholders' money....

      1. Commswonk Silver badge

        Re: The old quote

        or, in this case, a fool and stockholders' money....

        I think not... a fool and the customers' money would be closer to the mark.

    2. Anonymous Coward
      Anonymous Coward

      Re: The old quote

      "A fool and his money"

      Are always welcome at IBM?

    3. OnlyMee

      Re: The old quote

      It's a Bank. So fool with someone else money, most likely taxpayers if things go south.

  6. Erik4872

    Haven't companies figured this out by now???

    I'm well aware that IT outsourcing deals are settled over lavish dinners, golf trips and strip club visits, but you would think that companies would be wise to the outsourcers' playbooks by now. We'll see what happens in 8 or 10 years when Santander's back on the "bring it all in house" cycle again.

    It's not hard to understand...massively underbid the contract, include loopholes and omissions you could drive a train through, make up the difference by enforcing change order payments for anything not written in the contract, offshore all the workers to increase margin and do the absolute minimum work necessary to avoid losing the contract. I've seen it more than once and experienced a full outsource/insource cycle. It's not pretty.

    What are they teaching CIOs in their MBA programs that blinds them to the fact that the outsourcer isn't there to help them, but instead to maximize profit?

    1. Anonymous Coward
      Anonymous Coward

      Re: Haven't companies figured this out by now???

      "What are they teaching CIOs in their MBA programs that blinds them"

      They are not blind. They are teaching them how to use a company's assets for their own personal gain.

      1. Anonymous Coward
        Anonymous Coward

        Re: Haven't companies figured this out by now???

        The CIOs of the outsourcers are the better students.

    2. Regi

      Re: Haven't companies figured this out by now???

      Going through the outsourcing thing right now - it is a shit storm.......

  7. James Anderson Silver badge

    AI vs Real Intelligence

    I spent the first half of my career in Financial Services IT, writing and implementing systems that put everything under head office control and so they could de-skill or remove branch managers.

    The second half of that career was building humongous data warehouses, analytics systems, data lakes etc.. The goal of which was to glean information and insights that a traditional branch manager would have known instantly.

    Funny old world.

  8. Anonymous Coward
    Anonymous Coward

    Good luck to them

    Best of luck to them.

    I know for a fact that the engineers that IBM let loose on other vendors equipment in Santander DC's had so little a clue that multiple visits by other engineers were required to fix the mess.

    I also know that other major outsourcing deals with Big Blue lead to major cost increases for the unlucky parties.

    Anon for obvious reasons.

  9. Throatwarbler Mangrove Silver badge
    Angel

    'The group wants IBM to help it build "the most advanced IT architecture of the financial sector".'

    On the one hand, you may not have thought your cunning plan all the way through. On the other hand, the bar is pretty low.

    1. Anonymous Coward
      Anonymous Coward

      Not possible

      IBM already promised that to my employer who are a direct competitor to Santander.

  10. Anonymous Coward
    Anonymous Coward

    On the Brightside

    they could have gone to Crapita

  11. Dave 13

    Hollow..

    IBM has lollowed itself out to the extent that all it can offer customers is hordes of offshore bodies and some H1-B visa holders in the US. Their sales force is competent but there's no there there anymore for implementation.

  12. Anonymous Coward
    Anonymous Coward

    Nobody ever got fired for choosing IBM

    Who better to test that old adage than Mr Chaos!

  13. Anonymous Coward
    Anonymous Coward

    From ripped off Somerset

    IBM had a contract with Somerset County Council using a joint venture 85% owned by IBM called South West One.

    They promised savings of £180m but instead syphoned off £69m from key services like schools and social care.

    Read about it here:

    https://dwfoh96rza0z7.cloudfront.net/wp/wp-content/uploads/2015/12/12104214/Dave-Orr-Paper2.pdf

    I bank at Santander and the interest rates on my savings are rubbish. This tie-up with avaricious and unprincipled IBM will end in tears.

    1. Anonymous Coward
      Anonymous Coward

      Re: From ripped off Somerset

      Seeing the same thing with part of a bank I used to work for.

  14. I'm not the messiah

    Watson

    Interesting that IBM have “sold” Santander Watson as Lloyds cannot use it as it breaches LLoyds and FCA security compliance regulation.

  15. PeterM42
    Facepalm

    O.M.G!!!!

    I am both a shareholder and customer of Santander - Heellllllppppp!!!!

    Also worked at a company where IBM were eventually thrown out, so am well aware of the upcoming disaster.

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