RBS NatWest May Need a Mainframe Operator
June was an awful month for the British banking industry: revelations that Barclays and other banks have been fiddling with the LIBOR survey, cheating borrowers out of billions; several banks offering restitution to small business customers who bought poorly explained rate hedging contracts that were written primarily for the sole benefit of the banks; and a massive breakdown in the payment processing flows at NatWest and Ulster Bank (both owned by RBS). Some bank customers couldn't access their money for days due to the failures.
RBS hasn't said anything about the root cause of the problem that affected so many customers — and which has cost the bank a substantial sum. However, The Register has published two reports (here and here) which explain the causes. The reports are thinly sourced, so caveat emptor. If the reports are correct, RBS applied an upgrade to their CA-7 scheduling software. The upgrade did not go well, but fortunately they had a safety net: they could back out the upgrade. Unfortunately the operator who backed out the upgrade also erased the roster of scheduled jobs, and it took days to recover from that operator error.
The Register also goes on to explain that RBS as recently as February advertised for one or more India-based CA-7 operators. The Register pointedly asked RBS whether the particular operator(s) who botched the back out of the upgrade is(are) based in India. RBS has declined to comment, but I'm sure that information will be revealed in due course since British banking regulators will conduct a full investigation.
Let me make an editorial comment here. Some of the most talented IT staff in the world are located in India. That said, RBS apparently wasn't interested in hiring the most talented staff. RBS's management was evidently interested in hiring the cheapest. I don't think a CA-7 operator, particularly one with the awesome responsibility of delivering banking service levels, ought to be paid £11,000 or less per annum.
I'm curious to know the truth, and hopefully the truth will be revealed and/or confirmed. In the meantime, remember that "you get what you pay for" — or what you don't pay for.
|by Timothy Sipples||July 2, 2012 in Business Continuity, Economics, Financial |
TrackBack URL for this entry:
Listed below are links to weblogs that reference RBS NatWest May Need a Mainframe Operator: