A tale of two banks, simplification, and AI - Barclays story

There’s an important philosophical point underpinning strategic tech thinking at Barclays, the UK’s second-largest bank by market share. As articulated by Group CEO Coimbatore Venkatakrishna:

For some time now, technology has revolved around our businesses; now our businesses are revolving around technology.

The bank plans to increase its investments two-fold in 2026 to drive what Venkatakrishna calls “deep technological transformation and modernization”, including “embedding AI at scale across the group”.  And he’s going to do this, he adds for good measure, while also generating higher returns over each of the next three years.

Simplification is a key driver here, he explains:

Our journey began by creating a simpler business structure organized and operating in a simpler way. It continued with the simplification of our processes and customer journeys to improve the quality of our service and to drive efficiency... I want Barclays to be renowned for operational performance, excellent operational performance. And to me, operational performance and financial success are two sides of the same coin. With three-quarters of our colleagues engaged in operating the bank, simpler operations can improve efficiency materially.

He cites Finance as an example:

We are simplifying our accounting platforms, moving from 11 to three sub-ledgers within the trading book. This will lead to fewer manual reconciliations, faster reporting and more efficient data analysis. On the Risk side, our wholesale credit risk systems remain overly manual, so we are re-building the architecture and using AI to aggregate and analyze data and generate reports. This supports fast and accurate credit decisions.

Overall, he argues:

The simpler Barclays is both well-organized and well-run for colleagues and customers alike. And at the beating heart of this is a standardized infrastructure supporting harmonized processes and enabling modern approaches to product development and delivery.

AI, of course

That leads to an important goal being set:

By 2028, we will deliver a simpler but more sophisticated suite of products and AI-enabled services.

There have been early learnings from the work done with AI to date, he says, not least a valuable one about the importance of human intelligence in the mix alongside its artificial counterpart:

I think what people are finding is that it's not just enabling a particular type of model or a particular capability on everybody's computers and then get to work. You have human adoption and then you have, more importantly, the ability to get it to work in the system. To get it to work in the system requires three things. One is the basic infrastructure, then adding the capability and then the third, the willingness to reengineer your processes.

Expanding on these points, he says:

The basic infrastructure is about both data and computing. Then on top of that, you build the model capability, which exists in some of the computing platforms, but which you might put on your own. And then the third is the commitment to re-engineer processes, and you've got to really do it end-to-end. So whether it is that BARXBot, [Barclays AI chatbot] whether it is what we are trying to do in credit risk, whether it is what we are trying to do in US cards in the US Consumer Bank and customer service, you can't leave pieces of this undone.

It’s important to prioritise thought and Barclays is trying to pick the right projects that will have the biggest impact on the bank and see those through from beginning to end. Venkatakrishna says:

In the next three years, we will be deploying digital capabilities and AI to further this progress. To harness these technologies successfully, we must standardize our data, we must modernize our approaches, and we must harmonize systems and processes. Delivering in this manner will not only enable greater productivity, it will improve our operational resilience, our reliability and security. And importantly it will create a fulfilling working environment for our colleagues.

Foundations

To date, in terms of tech transformation, Barclays has made the most progress around cloud computing running on scalable infrastructure:

We are one of the leading adopters in this sector with 89% of applications on the cloud versus 75% two years ago. This platform provides greater stability and faster product deployment. We are also migrating core data onto a standardized platform. This helps us to provide personalized services for our customers and to implement models more rapidly. And by building on these modular foundations, we can accelerate the development, testing and deployment of code and models.

With cloud infrastructure and data platforms in place, Venkatakrishna is confident that the bank is now able to deploy AI at scale. At present across the group, there are more than 250 AI tools and models in use. Venkatakrishna explains:

In the past two years, we've held a number of AI hackathons, where employees prototype quick solutions to existing business problems. Every time I visit a hackathon, including one just 2 weeks ago, I'm overwhelmed by the seemingly limitless ambition and inventiveness of our colleagues. And their winning ideas translate into actual projects and actual products.

In the US Consumer Bank, we are launching a conversational AI tool in our app. This accelerates customer query responses by 95% and enables more personalized service. We've also built the infrastructure and provided colleagues with tools to drive greater efficiency and productivity. In doing so, we enable them to perform in the economy of the future. The rollout of GitLab to 19,000 developers means we are now able to implement code 15% faster.

CX

Casting a long shadow over all of this is the Barclays customer and the experience on offer to them, says Venkatakrishna:

I strongly believe that happy and satisfied customers are the sine qua non of any enterprise. We aim to improve customer service by investing in it deeply, making it a point of ambition and pride.

And a balanced human and digital offering is what will power that, he argues:

Our digital platforms are a critical part of providing a superb experience to deepen customer engagement. This year, we will re-launch the Barclays app to deliver more personalized support through digital channels. Even as we emphasize digital engagement, we recognize that customers sometimes value the quality and depth of engaging with us in person, especially with complex issues and in important life moments. So we will look to enhance and expand our branch footprint.

In summary, Venkatakrishna repeats his basic philosophy:

For a long time in this industry, technology has revolved around the businesses; now as you see not just in us, but across the industry [with] the depth and extent of technology-based services, products, and delivery, the businesses are revolving around technology.

What that means, especially if you're going to take advantage of the promise of new technologies like AI and cloud computing, is that you've really got to harmonize your processes and standardize your approaches, especially when it comes to -data platforms and to the way in which you construct and store your data, the way in which you do computing, the way in which you build models and the way in which you deliver. If these things are not standard, you add huge complexity. We've got to unravel that complexity...That’s a big task, and that's what we are trying to do.

My take

Two comments from Venkatakrishna bear picking out as basic lessons for others to learn from:

Across the banking system, technology is not just affecting how we do business; it’s also affecting what business we do.

And:

Operational excellence and financial success are two sides of the same coin. I see them as the same.