1. Bridging IT implementation with ANZ’s organisational culture
Presentation to AFR 3rd Annual Banktech Summit
7 November 2002
Peter Dean
Head of Technology, Personal Banking & Wealth
Australia and New Zealand Banking Group Limited

2. Agenda Aligning IT with ANZ’s culture
The ANZ approach
Strategy
Technology focus
Aligning IT with ANZ’s culture
People
Customers
Processes
Infrastructure
IT Case Study: ANZ’s approach to project management - aligning IT with ANZ’s culture.
Key achievements

3. ANZ’s Strategy Our targets Organic out-performance Portfolio reshaping
Extend specialisation
Grow customer numbers
Increase share of wallet
Drive productivity
Our targets
Organic
out-performance
Revenue growth materially higher than expense growth
Take business units to sustainable leadership positions
Build a range of strategic options
Portfolio
reshaping
Invest in high growth areas
Build specialist capabilities
Exit weak positions
Risk reduction
Transformational
moves
Step changes in positioning
Creating new growth options
Proactively shaping industry
Create the ‘Bank with a Human Face’
Build strong commitment to our people
Promote team performance and cultural transformation
Breakout
culture

4. ANZ’s Technology Focus
Putting technology to work to:
Provide our customers with a personalised, consistent experience
Empower our customers and our people with real time information access and online applications via web-based technology, anywhere and anytime
Ensure our technology is robust, flexible and cost effective
Aggressively reduce costs, improving productivity, benchmarking, increasing ‘straight-through’ processing, simplifying and automating administrative functions
Provide low-risk, high-efficiency & state-of-the-art payment capabilities

5. Agenda The ANZ approach Aligning IT with ANZ’s culture
Strategy
Technology focus
Aligning IT with ANZ’s culture
People
Customers
Processes
Infrastructure
IT Case Study: ANZ’s approach to project management - aligning IT with ANZ’s culture.
Key achievements

6. Initial Strategy (1998) – provided focus to align IT with ANZ’s culture
Customers (BU)
People
Process
Infrastructure
1998: Inward focused, low satisfaction, weak process, complex infrastructure
Little BU focus
Poor understanding of business drivers
Service levels poorly understood
Leadership weaknesses
High staff turnover: 18%
Many cultures
Poor disaster recovery
Inconsistent architectures
Poor project management & methodology
Billing of services incomplete and inaccurate
Inflexible, high cost technology
15 data networks
6 core systems
Many different platforms

7. Customers - Commitment to focus technology on business unit objectives
Service level agreements in place for each Business Unit
Average SLA for major systems
Average
Average
Average
Detailed billing to Business Units for IT services
Clear alignment between Technology & Business Units
Customer survey/ feedback process on 6 monthly basis. Linked to individuals’ performance measures.
Electronic timesheet capture for IT project tracking, reporting & billing

8. People - Skilled & committed
Management tertiary qualifications policy
Breakout cultural transformation workshop
Online training courses
heavily subsidised packages for staff to acquire PC’s
Half yearly staff survey with action teams to address issues raised
$$$
eVouchers provided free to staff to choose reading materials

9. Process – designed to improve execution capability
Project in a Box
‘Best of breed’ project management tools
Central repository for all project reporting
Open access to all users
Capability Maturity Model
Significant productivity & quality improvements
CMM
Australia Partial level 2 certification - 1st Australian Bank
Bangalore, India level 4 certification
Project management training
Generic training courses tailored with ANZ specific content & latest Project in a Box tools
Reengineering in a Box
Standard tools, templates & process for re-design of business processes
Continuous improvement programme
Driving real culture change
Series of workshops for all staff
Resulted in significant cost savings

10. Infrastructure - Commitment to rationalisation & standardisation
Core Systems
IP network
CBS
Hogan
2001
2000
1998:
6 major systems
1998
Multiple data networks
Single IP Network provides universal connectivity
Simpler systems & platforms reduce cycle times
Servers & Desktops
Platforms
1998
2002
1998
8+ major platforms
2002
OS/2
Win 3.1
Win NT
DOS
Platform Focus
Eg,W2K, UNIX, MVS
Provide all staff with best tools possible
Low cost of ownership through standard solution
Greater ability to leverage new technologies
Lower hardware, software licence fees & support costs

11. Initial IT strategy (1998) – where are we in 2002?
Customers (BU)
People
Process
Infrastructure
2002: Customer focused, positive culture, improving process, simpler infrastructure
Explicit business partnership
High Customer satisfaction 7.7 (Sep 02)
Service Level Agreements
Customer Survey/ feedback process
Significant benefits from our continuous improvement program
Improved Staff satisfaction to 83%
IT staff turnover below 4%
Training on-line
Leadership Development program
Performance culture
Full DRP in all critical processes
854 staff through Project Mgt program
New Processes - PiaB, One Team, CMM, Niku, RAD, Phased funding, Outcome Management
Technology costs defined and regularly reported
Technology governance, standards & policies
Detailed billing
Tandem, Unix & AS400 rationalisation
2 core systems
Single IP Network
Standard Win2000 desktop across Australia
Intranet to all but 800 Int’l staff
Established strategy for standardisation and re-use

12. Agenda The ANZ approach Aligning IT with ANZ’s culture
Strategy
Technology focus
Aligning IT with ANZ’s culture
People
Customers
Processes
Infrastructure
IT Case Study: ANZ’s approach to project management - aligning IT with ANZ’s culture.
Key achievements

13. Situation analysis - What our internal business customers expect from IT
IT support of each Business Unit’s strategy and agenda and elivery of annual Business Unit targets
Dedicated IT team to meet Business Unit needs
Maximisation of the return on investment in technology
Accelerated, high quality, ‘no surprises’ delivery of IT projects
Substantial increase in output, at reduced cost
Zero customer impact operating environment
Increasingly aggressive use of technology in short time frames

14. Our Project Management Challenge
Situation
High demand for professional staff
Resources increasingly expensive and limited
Need to move from traditional ‘technical’ focus to ‘systems & business integration’ focus
Complexity of large specialist organisation
Projects increasingly need to cover multiple businesses
Need to improve project delivery and build & maintain a project management culture
Ensure a ‘no surprises’ culture
Solution
Develop high quality project management system to better leverage our existing project management capability

15. Our Approach CMM PM Began with pilot of 100 staff Widespread
To ensure high quality delivery of IT projects, we implemented a two-phased approach - the Capability Maturity Model (CMM) for software development, followed by the refinement and enhancement of our project management (PM) practices
CMM PM
Began with pilot of 100 staff
Widespread
deployment
in Australia
Development of ANZ’s Project Management practices
Implementation
in India
Results were meeting expectations within 6 months
Work has been almost entirely self funding

16. Project Management Practices – what we have done
Improved project delivery capability
Improved project management capability
Better managed the utilisation of project management skill sets to our project portfolio
Key attributes
Evidenced by increase in projects with green or amber status
Peer reviews, training and mentoring of project managers, project review process
More informed of skill levels of project managers and better understand current and future skill requirements

17. Project Management Practices – key outcomes
Improved delivery capability
Professional project management culture
Appropriate project management skills available for all project engagements
Highly developed project management skills and practices
Improved risk profile for portfolio of projects
Enhanced compliance to all standards and policies

18. Project Management Practices - advantages
For our business
Greater flexibility
Improved exposure and understanding of ‘project risk portfolio’
More predictable project start-up and outcomes
Standard modus operandi
Development of the correct Project Management skill set for now and the future
‘Better and wanted project managers’ most appropriate candidate for an engagement
Proper management of Project Management careers
For team members
Better development of Project Management career paths
Increased choice on future engagements
Focussed career management
Mentoring and coaching from within/ peer support
Information forums
Generic measurable Project Management KRAs
Participate in project peer reviews

19. Key challenge is change management
Key lessons
Key challenge is change management
Winning hearts and minds is difficult at outset
First 6 months is very difficult – needs strong leadership & experience helps
Success = excitement = more success
Do this for tangible, business outcomes
Use metrics to track progress and lock in results
Make sure everyone is accountable for the same outcomes – and use strong incentives
Strong support for teams with their customers – dates will be missed early in the program
Teams go through a ‘valley of despair’ in the early stages and need help through this

20. Key achievements
Aligning IT implementation with ANZ’s focus on people, customers, process and infrastructure has delivered:
Better outcomes for IT’s business unit customers
Higher customer satisfaction
High IT staff satisfaction rate
High quality, more productive IT staff
Simpler infrastructure - robust processes supported by a continuous improvement focus

21. Questions?

22. Copy of presentation available on 1

23. The material in this presentation is general background information about the Bank’s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate.
For further information visit
or contact
Philip Gentry
Head of Investor Relations
ph: (613) fax: (613)