The Challenge

This all derived from the Banks continuous improvement activities, along with an inspection from the Danish FSA. As part of a larger inspection, the Danish FSA investigated Danske Bank’s methods of outsourcing, how they were running RFIs and RFPs and if their management of vendors complied with the European Union regulations set out by the European Banking Authorities.

Questions were asked whether Danske Bank could demonstrate to be in full control of outsourced activities, in terms of running sufficient governance, monitoring their vendors performance as well as having mitigation and business continuity plans for the eventuality of a vendor relationship breakdown.

The Danish FSA were largely satisfied with the Contract and Performance Management’s implemented methodology for managing supplier agreements, having the processes and the ‘state of the art’ contract management framework in place. Despite having those key elements in place, DFSA came up with four concerns:

1. Evidence of managing a vendor correctly was difficult, requiring manual and resource intensive activities to demonstrate compliance. Legacy systems, data siloes and the use of both mail and SharePoint stifled Danske’s ability to assemble historical governance evidence.
2. There was no active audit trail supporting evidence logging related to governance reviews with their suppliers, nor were there any insights providing data for reviews and audits. There was The Challenge no holistic view of their vendors, showing actual vendor health (achieved performance and compliance score, finance, governance execution etc.)
3. The scope of vendors managed was too narrow and should include all Danske Bank’s Outsourcing Arrangements. Up until this point, the focus of the Contract and Performance Management team was on targeting the IT arrangements critical to delivering valuable and 24/7 services to their banking customers.

Based on the raised concerns, Contract and Performance Management decided to start up two development tracks:

First, was to place all governance activities into a single tool. Outlining meetings, fixed agendas, documenting all participants and action logs from meeting to meeting – in a uniformed and consistent manner across the whole business. The platform solution should include a searchable Audit Log.

Second, was to oversee and manage all outsourcing arrangements more intensively, in order to comply with the Outsourcing Regulations, set out by the European Banking Authorities. Parts of this activity were later embedded into a Danske Bank wide EBA programme.

At this stage, Danske Bank carefully considered market leading procurement and service management platforms – ideally, selecting a tool which was easy to deploy with an out of the box fit and low total cost of ownership. Based on the investigation, Danske Bank decided to run a POC on the Brooklyn tool, expecting the tool to deliver the ‘one stop’ platform needed.