Exodus of consultants and contractors at Australia's NAB
As part of its Covid-19 response strategy, National Australia Bank (NAB) has slashed funding for its ‘change the bank’ portfolio, a decision which has seen around 100 projects killed or put on hold.
The move is grounded on two objectives, said NAB chief executive Ross McEwan in an email sent to all of the bank’s roughly 35,000 staff. First, it aims at freeing up internal resources by redeploying staff from change projects to in-demand roles needed in the standing organisation.
“We are being swamped with inquiries and needed to focus on what matters. Every one of us needs to be working to support customers in need, and immediately. This is mission-critical,” he wrote.
As a result, “Our most urgent priority is to help our colleagues in contact centres, branches, business banking centres, NAB Assist, fulfilment, operations and other customer-facing roles, who are being inundated with customer inquiries.”
Second, by cutting roughly hundred non-essential projects, National Australia Bank is saving on its huge bill for external consultants and contractors. NAB has in recent years increasingly turned to external experts for support, in particular to support the acceleration of its digital transformation and cost cutting agenda.
According to an analysis by Consultancy.com.au, NAB spent nearly $300 million on the Big Four alone in the past decade, of which $200 million related to audit services, with the remainder going to non-audit advisory services and consultancy support. Last year, the bank among others worked with McKinsey & Company on a risk culture audit.
Speaking of the move to slash externals, McEwan wrote “This decision is extremely difficult, but necessary” further demonstrating some empathy to all those that have seen their income come abruptly to an end. “For this I am sorry. I wish we didn’t have to take this action, but it is the reality of the situation we are confronted with. We will treat them fairly, we plan to offer support beyond what is required.”
However, around 20 projects deemed “key” to the bank’s future will continue to run. These projects are considered crucial and are concerned with corporate strategy, system resilience, digital access, the provision of credit and providing relief for employees at the frontline. One of those is the strategic planning review currently being worked on together with Bain & Company.
Last week, chief executive McEwan announced that NAB is preparing to close 70 hardly used branches of its 730-strong network in order to use as premises to retrain staff aimed at clearing the backlog of inquiries from customers who are desperate for help amid the covid-19 disruption.
