INTRODUCTION
Case study is about computer failures that occurred at Royal Bank of Scotland due to inexperienced operative in India. this has resulted in millions of customers unable to access their account simply because of a mistake made by a technician. This issue occurs when the software upgraded is implemented. All programming staff at RBS admits that matters is occurred because they have been based in Hyderabad, India.
Based on technology website, The Register, there were team members who need to responsibility for the incident and it has affected the department in the UK. Union has blamed Fiasco because they decide to take more IT employees of the company from outsource. This will be affects the local workers, Indian staff, because they are paid less than British Counterparts.
The Chief Executive of RBS, Stephen Hester defended outsources company and said that there was no evidence that the problem is due from company outsources. The error is occurred after the software upgraded to the bank’s computer system last Wednesday, and it affects 17 million customers. Although the problem can be resolved on Friday, but RBS has a backlog of more than 100 million transactions that were not paid in or out of the bank.
The RBS already make a promised that will pay all the compensation for the cost of fines and late fees to their customer. The bank experts said that RBS need to paid all the costs of compensation, including the cost of extra staff to customers within 50-100 million Pound Sterling. Mr Hester also admitted that the bonus for the Senior Staff of RBS will be reduce for the reimbursed.
Mr Hester had to waive bonus shares worth 63,000 Pound Sterling for public protests and political pressure. The Finances Services Authority w...
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...ng IT through Managed Services ; http://www.essent.com/EssentWebsite/News/Blog/The-Top-10-Benefits-of-Outsourcing-IT-through-Managed-Services-284-24.htm
4. Top 7 Outsourcing Advantages Outsourcing Advantages: A Back-Office Operations Illustration By James Bucki ; http://operationstech.about.com/od/officestaffingandmanagem/a/OutSrcAdvantg.htm
5. 10 problems with outsourcing IT By Jack Wallen in 10 Things, January 26 ; http://www.techrepublic.com/blog/10-things/10-problems-with-outsourcing-it/3016/
6. Benefits Vs. Risks of Outsourcing IT Services by Samantha Gluck, Demand Media ; http://smallbusiness.chron.com/benefits-vs-risks-outsourcing-services-2504.htm
7. Top 6 Outsourcing Disadvantages Outsourcing Disadvantages: Reasons That Outsourcing is Bad for Your Company By James Bucki ; http://operationstech.about.com/od/outsourcing/tp/OutSrcDisadv.htm
APPENDIX
The emergency rescue of the Royal Bank of Scotland in 2008 has cost the UK government thus the British taxpayer a huge amount of money. Many people are upset about the high bonuses the RBS management board have received, both because of the outrageously high amount and because the performance of the bank on the long-term was not good at all. According to the agency theory managers do not always act in the interest of the shareholder, but often act in the interest of themselves. The downfall of RBS could have been prevented if managers were not paid out a bonus based on their performance of one year, but rather a combination of a bonus based on their performance of multiple years and a bonus ...
Outsourcing simply means acquiring services from an external organization instead of using internal resources (Butler, 2000). By using outsourced resources, organizations can gain a competitive advantage by utilizing contingent staff to accomplish strategic goals without incurring the fixed overhead. By focusing on the leading edge and highly specialized skill sets, outsourcing providers can often offer higher quality services, or at a lower price than the client organization. Typical reasons for outsourcing go beyond simple contingent staffing. Outsourcing providers are able to maintain economies of scale with regard to specialization (...
The main problem, in this case, is involving Vermont Teddy Bear which was John Sortino in 1981 is that the companies point of sale system was severely lagging behind. In 2011, The company struggled with major surges in customer periods, for example, Valentine's day and Christmas Eve this occurred because of VTB's intricate middleware system. The issue may have happened because instead of revamping it's system during down periods the company attempted to do patch work jobs over time. This is quite alarming because a major retailer would not have these types of issues with the system when they need it most. Which leads to the next point of the IT supervisor being faced with a dilemma on what to improve prior to the next surge period(Mother's
Both sides can agree that outsourcing can be desirable for a business do to the potential profit. It allows goods to be made cheaper, management to run smoother, and money to be made faster (Salanţă 270). Both sides can also agree, however, that U.S. jobs are lost as a result of outsourcing (Ahmed 192), as well as environmental damage being cause due to corporations taking advantage of loose environmental regulations (Marquis 39). Upon digging deeper into this debate, one can find that both sides present very convincing arguments.
Weintraub, Daniel. “Outsourcing is Good for America…and California”. The Sacramento Bee. 13 July 2004. Google Search. 5 December 2004
Kibbe, C. (2004, 07 09). Outsourcing: the good, the bad and the inevitable. New Hampshire Business Review, pp. 1A-21A.
This case study is related to the computer glitch that happened in a bank. The Royal Bank of Scotland has caused millions of the customers unable to access their account. This incident happened is caused by a junior technician in India do not have the skills that are efficient in carrying out a given job.
So, if you remove the bottom half of the iceberg (internal customers), top half of the iceberg (the external customer) will sink- in the other words, the whole organisation will come to an end. It is important for Barclays to treat their internal customers in the same way, as they treat their external customers. The advantages of having internal customers to employees: * Better working conditions * Better job satisfaction * Less stress * Having the ‘feel good’ factor * Being part of a good working team The advantages of having internal customers to the organisation: * Less waste and stoppages * Improved communications * A happier workforce * Fewer problems * Increased customer loyalty * Better service to external customers The advantages of having internal customers to the external customers: * A higher, sustained level of service *
Flynn, Donal J.; "Information Systems Requirements: Determination and Analysis"; McGraw-Hill Book Company; 1992Parnas; 1985; taken from: Sherer, Susan A.; "Software Failure Risk – Measurement and Management"; Plenum Press; 1992Jones, Carpers; "Patterns of Software Systems Failure and Success"; Thomson computer press; 1996Neumann, Peter G.; "Computer Related Risks"; Addison-Wesley publishing company; 1995Petroski, Henry; "To Engineer is Human"; MacMillan Publishing; 1985Flowers, Stephen; "Software failure: management failure"; Chichester: John Wiley and Sons; 1996.Report of the Inquiry into the London Ambulance Service; February 1993. Simpson, Moira (1994); "999!: My computers stopped breathing !"; The Computer Law and Security Report, 10; March – April; pp 76-81Dr. Dobbs Journal; January 1997 edition<a href="http://catless.ncl.ac.uk/Risks">http://catless.ncl.ac.uk/Risks<a href="http://www.scit.wlv.ac.uk ">http://www.scit.wlv.ac.uk <a href="http://www.bbc.co.uk/news">http://www.bbc.co.uk/news<a href="http://abcnews.go.com/sections/travel">http://abcnews.go.com/sections/travel
Outsourcing has been around for many years. In this paper, I will discuss some of the history of outsourcing, the good things about outsourcing, and the bad things about outsourcing. Outsourcing is important because many companies rely on it in order to get many different products and services to their facility on time and in good shape. Outsourcing is a huge part of the business industry today. Any business can be affected by outsourcing.
The summary we can make after read the case study is the system down in RBS Company has make the million of customer unable to access their account. The management in Royal Bank of Scotland (RBS) have found people who have caused the problem which is the junior technician from India, who accidentally erased a massive swathe of information during a routine software upgrade...
[4] Gupta, Sachin. For a global software company, outsourcing began at inception . World Paper. April 19. 2004 http://www.worldpaper.com/2004/april/april4.html
Outsourcing is a technique for companies to reassign specific responsibilities to external entities. There are several motivations for outsourcing including organizational, improvement, cost, and revenue advantages (Ghodeswar & Vaidyanathan, 2008).
The unions also blame fiasco because the decision to outsource much of the company IT source. The error that happen also came after the software being updated froze part of the bank computer system lost on that particular day. The day that this problem occur was in the Wednesday. The system is being recovery and the problem is solved on the Monday.
A disciplined approach to management eying leading employees, improving the management team and building the business strategy. Instead of treating each problem as a one off. They design systems and structures that make it easier to handle in the future. (Techrepublic, 2015) 2.2. Risk of exposing confidential data: When an organization outsources HR, Payroll and Recruitment services, it involves a risk if exposing confidential company information to a third-party Synchronizing the deliverables: Some of the common problem areas include stretched delivery time frames, sub-standard quality output and inappropriate categorization of responsibilities. At times it is easier to regulate these factors inside an organization rather than with an outsourced partner Hidden costs: Although outsourcing most of the times is cost-effective at times the hidden costs involved in signing a contract while signing a contract across international boundaries may pose a serious threat Lack of customer focus: An outsourced vendor may be catering to the expertise-needs of multiple company at a time. In such situations vendors may lack complete focus on your organization 's tasks. 2.3. 1.Know the