Program planning and asset management are two areas where Australia’s biggest four banks can improve on efficiency, according to the Retail Bank Benchmarking Survey 2015.
Conducted by Turner & Townsend, a professional services company, the anonymous survey of National Australia Bank, CommBank, ANZ and Westpac provides benchmarking data on design, program planning and costs.
The data is designed to assist the banks with their future strategic planning and asset allocation with regard to capital program delivery.
The survey shows a large disparity between how the banks approach capital program delivery, cost reduction and expenditure on internal fit-outs of their retail branch network, said Jon Poore, Director of Consulting at Turner & Townsend. “Some institutions [take] a proactive approach to asset planning whereas others were more reactive to changing customer demands.”
Poore also identified potential savings from introducing design standards and implementing more cost effective procurement strategies.
“Based on the survey research and our experience, I would estimate that savings of between 10 to 15% per annum are realistic targets if appropriate program, design and procurement strategies were put in place,” he said. “These savings have the potential to run into millions of dollars across the banking sector.”
One organisation spent more than 15% of its annual capital expenditure on unplanned work indicating a need for better planning.
Poore recommended “a solid long-term plan for projects, which unlocks bulk procurement opportunities and avoids unnecessary costs” to prevent this.
“Each year banks spend millions of dollars on renovating, relocating and purchasing property assets. Property is one of the greatest assets any bank has and needs to be managed accordingly with a long term strategy,” said Poore. “A simple and clear framework needs to be adopted in conjunction with the corporate team’s objectives to ensure the greatest cost savings and efficiencies can be realised.”