Like a portent of blackouts to come, our IT systems are creaking and crashing

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The Independent Online

As someone undergoing the torturous process of switching mortgage provider, I’ve just got over the trauma of calculating my monthly entertainment budget and guessing at what age I might retire.

So I can sympathise with homebuyers whose administrative headache grew this week with the collapse for many hours of the Bank of England’s payments system.

The volumes that Chaps (the clearing house automated payment system) processes are not insubstantial: £277bn daily, including same-day money transfers to pay for new homes. Where Britain’s financial system is concerned, the suspension for technical reasons of the Real Time Gross Settlement system (RTGS), which had a knock-on effect on Chaps, felt akin to the lights flickering when our power stations finally fail to keep up with demand one winter soon.

The Bank, which launched a full review of what went wrong, has spent a lot of time over the last couple of years making sure that the companies it oversees are up to speed with the best technology. Last year it carried out Waking Shark II – a three-day simulated cyber attack on the City – to check on the sturdiness of the IT defences required to keep criminal gangs and terrorists at bay. The verdict was that the financial firms needed to act more quickly in reporting breaches to the financial regulator.

There have also been calls from Andrew Bailey, the deputy governor, for banks to spend more to improve patchwork IT systems that are found wanting every time a cashpoint network fails so that millions of customers cannot gain access to their money. Banking technology will be back in the headlines next week. Lloyds is expected to unveil a new strategy to cater for customers who spend more time carrying out transactions online than in branches. Lenders are still catching up on investment in this area after soaking up new regulatory costs brought about by the financial crisis.

The Bank, meanwhile, has made great play of overhauling some of its own creaking architecture – that is, membership of the Court of Directors. Over the summer, it brought in fresh blood in the form of the TalkTalk broadband boss Baroness Harding and Dorothy Thompson, boss of the power giant Drax.

It remains to be been seen whether the Bank’s computer systems require a similarly modern makeover.

The BBC should return to its roots, not ape commercial TV

Lord Hall dispensed some leadership lessons in a question-and-answer session at Cass Business School the other night. Professor Laura Empson, director of the Cass Centre for Professional Services Firms, persuaded the BBC’s director-general to speak after the pair became pals taking the same train into Paddington for seven years. For much of that time, Lord Hall was content to lead the Royal Opera House and regularly had an opera score open on his knee in the carriage.

Last April, when he returned to the BBC, he devised a basic three-point plan. First of all, construct a team, then deal with the problems of history – namely a culture of over-the-top payoffs for senior staff and an expensive but ineffectual digital project – and define where the organisation wants to go. He has mixed that with staying close to staff at all levels, such as with his flying visit to BBC Radio Stoke the other week to mark one staff member’s 40 years of service.

Lord Hall’s mantra of keeping staff “looking up and out”, even when confidence in the organisation is at a low ebb, is one that Dave Lewis could bear in mind as he plots what to do for the best as the head of Tesco. But Lord Hall has a very different challenge. While Mr Lewis must get the tills ringing in the short term but also prepare a long-term strategy, Lord Hall says he felt the BBC had forgotten its public-sector roots and borrowed too many ideas and people from the commercial world.

There are two more things he is intent on achieving that will help with reinforcing the right sense of identity. The first is joining up parts of the organisation to the greatest effect, as seen with its glossy Beach Boys video ensemble to promote the BBC’s musical prowess.

The second is to encourage more risk taking in programme making.

I doubt the BBC will ever applaud failure in the same way as they do in Silicon Valley. In justifying the licence fee, it strives to stay as relevant to as many people as possible – hardly conducive to risks.

But if Lord Hall can wean the BBC off some of the bland entertainment output that should be the preserve of channels with advertisers to keep happy, it would mark a handy reinvention before its funding has to be renegotiated.

Boards must try harder to achieve geographic diversity

City headhunters should think about putting in a spot of overtime. Sat next to a seasoned non-executive director at a dinner, talk turned to why the executive search firms he called on never managed to uncover enough new and exciting directors to join his boards. He scribbled down one name I came up with: a ferociously impressive woman who runs an international, hi-tech business in London but has so far sworn off joining other boards part-time. Then he pondered another challenge that British firms have yet to get to grips with. Why, if so much future economic growth is forecast to come from the east, are there so few Indian and Asian faces in British boardrooms? After gender diversity, geographic diversity is next.

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