Abbey and Eds

INFORMATION AND E-BUSINESS SYSTEMS

ASSIGNMENT 1: ABBEY and EDS

SECTION 1)

ABBEY is a leading mortgage lender in U.K., structured in business divisions, namely Retail Banking, Wealth Management, Finance and Markets, Manufacturing, Risk, Central Units, HR.

A strategic objective for Abbey is to gain competitive advantage, that is to improve its competitive position through a better service to its clients, an improved effectiveness in its internal operations and a reduction in costs (estimated in savings of Ј9 million per year).

In May 2001 Abbey and EDS created a joint venture company, EDS Credit Services, for the post-sales servicing of Abbey's mortgages and personal loans.

Another strategic goal will be the diversification with the growth of this joint-venture in a company that the 2 partners hope to "become the leading specialist third party mortgage administrator in Europe".

Thanks to that decision the management at Abbey can now focus on developing its core business (trying to capture new mortgage clients while maintaining the actual ones and realize new business projects), without losing qualified personnel, further time and financial resources in a back-office function that can be more effectively delegated to an IT supplier as EDS.

EDS will be responsible for services such as:

* Account administration

* Customer service

* Payment processing

* Account reporting

o Arrears management, foreclosure and securitization

o applications and infrastructures

There are different options we can envisage if our organization is not able and willing to develop its information system in-house. Generally we can take into consideration either LICENSE APPLICATIONS or to use the service of an APPLICATION SERVICE PROVIDER if our needs are not too specific and we need to be operative immediately.

We can also envisage the alternative of USER-DEVELOPED APPLICATIONS. However an increasing number of firms are choosing to OUTSOURCING the development of their ISs.

In order to decide whether a company need to outsource part of its functions or to develop and implement them in-house we need an extensive discussion on the particular circumstances surrounding the organization in question. This analysis will not reach a definitive conclusion but only a provisional one because the continuing changes in the competitive forces within the company and in the market will affect our choice in the long period.

Once we have identified our internal points of strength and weakness and our objectives, we can make a decision.

If the company chooses to outsource it will face another major decision: to whom delegate the task?

Generally we cut a deal with some IT outsourcing company after a public tender.

The top ten IT OURSOURCING COMPANIES are the following:

* IBM Global Services

* EDS

* Computer Sciences Corp

* Hewlett Packard

* Infosys.

* Wipro

* Tata Consultancy Services

The choice of EDS secures the expertise of a world-class partner, reliable (unblemished track record in delivering result) and financially in good shape (important element when cutting deal in the long period).

Thanks to the decision of outsourcing we modify an important element of our cost structure: the mortgage processing is no longer a fixed cost but a variable one. That means more flexibility and less risk.

Generally speaking we can say that outsourcing can be useful and economically viable in that we can delegate the projecting and the implementation of a process to the expertise and competence of another subject. Our company can simply put the exiting human, technological and financial resources without spending time and money in personnel re-qualification, a new department or diverting from the enterprise's core business. If properly projected and implemented this solution can not only result in savings but can also expand the flexibility in responding to market's changes, add a new set of competencies to our company and eventually offer a better service to our clients.

Is' objectives are:

* Trying to implement some of the above mentioned strategic initiatives.

* Reengineering part of the bank's activities.

* Improving the capability, security, and reliability of the bank network and network resources.

* Giving an effective, trustworthy and efficient administrative computing system.

* Installing desktop computing configuration and help to speed up and simplify the installation and update process for desktop computers.

IS helps an organization to reach competitive advantages when:

* Raise barriers to market entrants

* Reduce costs

* Establish high switching costs

* Help to produce new products or offer new services

* Help to differentiate products/services

* Enhance products/services

* Establish alliances

* Lock in suppliers or buyers

SECTION 2)

In planning the implementation of an IS we should divide the whole process in different yet coherent steps.

Given our corporate mission statement we should identify and formulate our IS mission. In other words we should state the role that IS has within the company.

In accordance with the IS mission we should now elaborate our IS vision.

The goal of the IS vision is to find out the ideal mix of hardware, software