The case, ‘Santander Acquires Abbey: The Jack Project’, applies a general strategic management focus to an analysis of the ‘Jack Project’, the Spanish banking group’s IT centric project to acquire Abbey.
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It was highly innovative.
On 12 July 1989, Abbey was the first building society to become a public limited company and was floated on the
London Stock Exchange. In August 1996, Abbey National merged with the National and Provincial Building Society, gaining almost 200 branches and 3 million customers.
More recently, Abbey aggressively diversified into corporate and investment banking. New businesses included bond investments; financing companies; train maintenance; ship insurance; loan companies. In 2000, Abbey launched
Internet bank Cahoot, which won several awards for innovative product offerings.16 However, the misgivings of some Abbey directors proved well founded; the bank was left nursing heavy losses.17 An executive retrospectively reflected on the pitfalls of diversification:
Abbey fell for the siren song. It was a paradox – the market seemed to have tired of winners. Successful firms were given a lot of stick – it was as if success stuck in some people’s craw.
In 2001, Lloyds TSB proposed a takeover of Abbey
National, but the UK Competition Commission stopped the deal, alleging that it would seriously damage …show more content…
Cultural barriers to IT implementation were not believed to be an issue, since Partneno´n had been developed from scratch as a multi-language, multi-banking platform. Fuster expected the new system would be implemented locally by Abbey personnel, working closely with Santander IT staff (who were fluent in English).
Conversations with Abbey managers and trade union representatives had gone well, with agreement reached on early retirements and changing sales staff salaries from
100% fixed to an 80:20 fixed/variable salary ratio according to sales objectives. Fuster added:
We also needed to develop a communication plan to clearly explain Parteno´n’s enormous potential for boosting sales and what that meant in terms of performancerelated bonus payments.
In May 2004, Santander’s interest in Abbey was again leaked to the press. Botı´n wanted to buy Abbey for h13b
(d8.6b). He asked the executive team to wait until market rumours dissipated in May. The operation was put on hold as Abbey’s share price briefly rose on the news.
June 2004: preparing the road
It was highly innovative.
On 12 July 1989, Abbey was the first building society to become a public limited company and was floated on the
London Stock Exchange. In August 1996, Abbey National merged with the National and Provincial Building Society, gaining almost 200 branches and 3 million customers.
More recently, Abbey aggressively diversified into corporate and investment banking. New businesses included bond investments; financing companies; train maintenance; ship insurance; loan companies. In 2000, Abbey launched
Internet bank Cahoot, which won several awards for innovative product offerings.16 However, the misgivings of some Abbey directors proved well founded; the bank was left nursing heavy losses.17 An executive retrospectively reflected on the pitfalls of diversification:
Abbey fell for the siren song. It was a paradox – the market seemed to have tired of winners. Successful firms were given a lot of stick – it was as if success stuck in some people’s craw.
In 2001, Lloyds TSB proposed a takeover of Abbey
National, but the UK Competition Commission stopped the deal, alleging that it would seriously damage …show more content…
Cultural barriers to IT implementation were not believed to be an issue, since Partneno´n had been developed from scratch as a multi-language, multi-banking platform. Fuster expected the new system would be implemented locally by Abbey personnel, working closely with Santander IT staff (who were fluent in English).
Conversations with Abbey managers and trade union representatives had gone well, with agreement reached on early retirements and changing sales staff salaries from
100% fixed to an 80:20 fixed/variable salary ratio according to sales objectives. Fuster added:
We also needed to develop a communication plan to clearly explain Parteno´n’s enormous potential for boosting sales and what that meant in terms of performancerelated bonus payments.
In May 2004, Santander’s interest in Abbey was again leaked to the press. Botı´n wanted to buy Abbey for h13b
(d8.6b). He asked the executive team to wait until market rumours dissipated in May. The operation was put on hold as Abbey’s share price briefly rose on the news.
June 2004: preparing the road