Anz Offshoring Strategy Essay

4580 Words Aug 25th, 2013 19 Pages
ANZ | OFFSHORING

Background

This strategic report of ANZ’s offshoring strategy examines the effectiveness and drivers of ANZ’s decision to move towards outsourcing internationally, analyses the impact of ANZ’s offshore programs on stakeholders, explores key risks and opportunities and evaluates the success of ANZ’s offshore system.

A | Strategy Analysis

February 2012 saw ANZ confirm job cuts to 492 permanent employees, 100 of these positions to be moved overseas. In early 2013, ANZ again advised 70 “back office” employees in their wealth division that their jobs were being relocated to Bangalore in India. More recently, in the June quarter of 2013 ANZ have announced that due to the low credit growth environment and the need to
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ANZ’s offshoring arrangements can have a negative short term affect on the unemployment rate as jobs are exported. As a result of increased unemployment, the Australian Government faces financial, budgetary and economic issues. The government will face increased income support and health and community support claims, generally to be funded through taxes to the community. However, over the long term as ANZ’s offshore strategy facilitates growth and expansion of the bank, jobs may be indirectly created locally. Another adverse affect to the government will be the loss of tax revenues as the offshore workers get taxed in their home countries. On the other hand, the Australian Government will benefit from stronger international relationships through ANZ’s offshore programs which in turn could potentially lead to export growth and offshoring arrangements into Australia.

APRA a key regulatory body of the finance sector is also impacted by ANZ’s decision to relocate jobs. The regulator must monitor the finance sectors offshoring policies and procedures. APRA face increased policy development, travel and research costs in order for APRA to ensure that sufficient due diligence is being applied, adequate data security programs are in place and best practice is being upheld.

There are both positive and negative impacts to ANZ customers. The efficiencies and cost reductions that ANZ create through offshorinig jobs will

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