Standard Life has said progress in an operational cost cutting drive, centred on automated processes and outsourcing, helped support its business as profits fell in the recession.
The insurance and pensions provider it said it was “on target” to cut £75 million from costs by the end of 2010, after cutting £26 million in the first half of 2009. It also cut £100 million from costs under the first phase of it Continuous Improvement programme last year.
The news came as the company announced its operating profit fell dramatically to £348 million for the first six months of 2009, down from £543m for the same period a year ago.
Nevertheless, process automation and “outsourcing elements of IT development” had played a significant role in cutting costs, it said in a statement to investors. It is also standardising its IT infrastructure globally, and working on a finance, marketing and human resources transformation programme.
Standard Life has made a number of other operational efficiency improvements. Earlier this year it adopted Oracle Identity and Access Management in an attempt to improve customer and partner access to its online services. Using the system globally would reduce costs as well as improve security, it said.
The insurer has also developed a service-oriented architecture, which in the three years to 2007 saved £16 million in development costs. Improvements to document management with the upgrade of its scanners have also saved £1.1 million.