A Leading US Bank Unearths $2.5 Million in Contractor Savings in Just 3 Months

The Challenge: Contractor Inefficiencies Lead to Large Cost Overruns

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A leading US bank had a big problem: Their team of 3,000 IT contractors lacked accountability and was costing the company millions of dollars. This was due to company leaders not having transparency into daily work activity.
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Were they even getting a positive return on the millions of dollars they were investing in contractors? At the time, they had no way to tell. 
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The bank’s operations depended on an external workforce. But there was a disconnect between contractor work being done and what the bank was being billed by the outsourcing firms providing the contractors. Compounding the issue was the fact that the billing data provided by these firms was unverifiable and worthless.
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The bank adopted Insightful’s leading work analytics platform to properly understand contractor work activity, utilization, and payment for services – and what they discovered transformed their contractor ROI.

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In-Depth Data Gets Contractors to Deliver on Cost-Effectiveness

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To begin, the bank’s leaders rolled out Insightful to manage 500 IT consultants – approximately one sixth of its external IT workforce. 
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Almost immediately, Insightful’s work activity and capacity analysis data – clearly visualized for fast interpretation – revealed a sizable discrepancy between actual time spent working and idle time. In fact, the bank was being billed 25% more than the hours being worked.
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For the first time, company leaders could see that contractors were underutilized, leading to costly overstaffing. In short, the company was significantly overpaying for the return they were getting.
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They also realized that even during productive periods, inefficient workflows and processes were limiting the effectiveness of contractors. For example, Insightful showed that consultants were spending more than 36% of their time on messaging apps like Slack and Teams – apps not central to their IT tasks.
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Understanding contractor habits presented even more opportunity for improvements in the form of more streamlined contractor workflows, technology usage, and task completion.

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Unearthing More Cost-Saving Insights

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While focused on contractor utilization and productivity, company leaders made another cost saving discovery about how they were being billed by contractors. 
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The bank relied on multiple outsourcing firms to provide contractors, and Insightful revealed that each third party was billing them differently. Prior to using Insightful, this fact had remained hidden because the billing data provided by the firms was opaque, allowing them to bill exorbitantly without oversight.
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By identifying and addressing contractor inefficiencies with Insightful, the bank uncovered $2.5 million in contractor savings in just three months. A figure that will grow to $10 million annually. Savings that, without Insightful, would have remained hidden. The bank has also been able to shrink their external workforce by 27% while keeping the same level of output.
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On the back of these multimillion dollar savings, Insightful is now being rolled out across the bank's other 2,500 IT contractors, including a large segment of remote employees. This widespread use will further increase contractor utilization and eliminate overpayment for services to deliver tens of millions of dollars in savings.