Please answer each part in 500 words.

Banks have often built the majority of their technology solutions in-house in the past, this has changed gradually in recent years for a number of reasons, including costs, speed to market, and access to innovation and expertize. XDFL Bank's outsourcing-focused approach has been led by its desire to concentrate resources on meeting clients banking needs. Part of a larger financial services group, the bank has a small but growing share of domestic household lending and retail deposit markets, with growth driven by marketing to the parent groups clients and by generating new business. The bank serves customers via both digital channels and a branch network, with a particular focus on high levels of automation and investment in self-service delivery channels. Any banks systems must provide high availability, high levels of security and have the ability to cope with periods of high transaction volumes. Indeed, the ability of a banks underlying operating infrastructure to deliver on these expectations is critical to maintaining client trust," said the banks head of IT.

From an IT perspective, the banks strategy has been to outsource system support and development as much as possible: it brought in all of its 80100 systems - from core banking to reporting to applications supporting its digital channels. This means the primary responsibility of its 30 in-house IT staff is to govern and manage relationships with third-party vendors. The key reason for choosing an outsourcing strategy was to help the bank to focus on meeting customers banking needs; IT supports this aim, but it is not a core competence integral to the banks ability to serve customers. Rather than competing to recruit todays developer skills, the bank decided it was better served hiring staff that can combine a number of skills, including developer experience, project and vendor management to ensure that we work effectively with third-parties to deliver superior banking services to clients, explained the banks head of IT. The banks approach to service development is customer-driven and agile, which means it tends to make a lot of incremental changes on an ongoing basis, rather than launching big projects or releases. Despite only hiring around 30 in-house IT employees, the total number of people working on the banks IT infrastructure across all vendors runs into the hundreds.

a. Does XDFL Bank's approach on outsourcing give itself an advantage in terms of managing risk better? Justify.

b. What would be the factors on which the success of the outsourcing endevour of the bank be most dependent on? Explain in brief.