Npower and RBS / NatWest experience systems failures

One of my theories is that the private sector has just as many IT disasters as the public sector; it is just better at keeping them hidden. Occasionally something surfaces, like the BSkyB  court case with Lulu the dog (here), and the Sainsbury’s IT failings that Justin King addressed as one of his first steps in turning round that business some years back. But often incidents didn’t hit the press, unlike the public sector failures such as the NHS IT system, Rural Payments, the Child Support Agency... and so on, which tend to get public exposure.

However, these days it feels like issues are becoming more obvious more often, and the spread of social media has made it harder to conceal problems. When a few hundred Tweets suddenly hit the scene all at once, you know something is going wrong. And this week we’ve seen two good – or bad – examples of this.

Npower, the huge energy firm, have written to customers to apologise for a whole set of failings around billing issues. Amongst the issues, apparently customers in some cases haven’t been billed for months, or direct debit payments were not set up properly.

And yesterday, RBS and NatWest customers found they couldn’t use their bank cards for hours, on one of the peak pre-Christmas shopping days. This follows the major systems failure the bank suffered a few months ago.

Now it is not clear exactly what role suppliers have played in these problems, rather than internal resource. Offshoring was suggested as one of the causes of the previous RBS/NatWest problems, with a loss of experienced IT people in the UK, although it seemed to be internal offshoring rather than outsourced in this case.

And in the case of Npower, there are suggestions that there is a SAP system underpinning the billing – but of course we don’t know what has caused these problems.

But it does again point out how absolutely central large IT systems are to our daily lives – society and the economy just could not function without them. And despite all the hype about the “cloud” and small, dynamic, agile suppliers, there is still a lot of reliance on hardware, software and services coming from the IT giants. So managing those suppliers and contracts must remain high on the CPO’s priority list in many large organisations, if they want to try and avoid this sort of problem.

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