Given that 60 per cent of transformation projects fail to deliver their objectives, the ANZ bank was keen to focus on customer service and a global outlook when it moved to a new costing system.
“Some 60 per cent of transformation projects fail to deliver what they set out to achieve. As a community of costing practitioners, we should all be aspiring to get a seat at the leadership table where you’re providing costing advice,” ANZ head of costing, Steve Harris, said during a presentation at the SAS Forum in Sydney about driving transformational change and taking projects from costing to profitability.
The project has allowed the bank to shift to a tailored costing system, according to Harris
“Our strategic cost management team was focused on transfer pricing models back in 2008, and most of our projects were small. But the focus has now shifted to a tailored system where costing models are more interchangeable,” he said.
The project has seen the bank move toward an activity-based management (ABM) enterprise model and reduce costs, Harris said.
“We’re now moving towards ABM enterprise, sucking the data in and crunching the numbers rather than having our staff taking their time on tasks like these.”
Harris, who reports to 2008-appointed ANZ CEO, Mike Smith, said customer feedback was important in developing the project, but warned against allowing this feedback to overpower an agenda.
“We need to know how to talk to customers and tell them the value of what we produce. Some organisations I’ve worked with don’t focus enough on the selling.
“Listen to your customers but don’t neglect your agenda,” he said.
Harris said developing a long-term strategy with short-term goals coupled with a global outlook was important to the success of the project.
“The first step for us was identifying what the model would look like. We sat down with our customers and set ourselves up for getting that that point. We set ourselves some goals to reach in year one.
“The first year we aimed to integrate models. By year three we wanted to be integrated as a centre of excellence, have the team playing in multiple regions and reduce our involvement in transfer pricing down to 10 per cent.
“It was important for us to get a global view of costs. We needed to ask ‘what are operations looking like globally?’,” Harris said.