This decade-long acquisition and merger binge by banks has created plenty of business opportunities for outsourcers that have the capabilities to help the banks with reorganization and consolidation of their IT infrastructures.
Bethlehem Steel, headquartered in Bethlehem, NY, stayed ahead of the game. In 1992 the company did something most manufacturing plants in the union-run states of the Northeast might not try. It outsourced its information technology (IT) to EDS to ensure a brighter future for their investors and employees.
Although information technology did not occupy the place it deserved in party platforms during Australia’s September 1998 election, IT was brought to the public forefront by industry bodies. Australia is currently at a critical juncture of its multi-billion-dollar outsourcing industry, and the general concensus is that reform is needed.
As Richard Lister, head of the IT Outsourcing Group at the London-based Berwin Leighton law firm, looks at the U.K., he sees a maturing outsourcing market which he expects to be driven by three major trends in 1999.
Outsourcing: All outsourcing relationships are adversarial in nature because vendors want to be paid as much as possible for delivering as little service as possible, while customers want as much service as possible for as little money as possible. That, in a nutshell, is how Dean Davison, analyst, Meta Group, sees the industry.
In the early days of the outsourcing industry, CEOs usually made the decision without input from their data processing organization. That created a situation where the very concept of outsourcing was adversarial, according to John Harris, corporate vice president of marketing and strategy, EDS.
Major changes are taking place at General Motors. After an approximate 12-year relationship with EDS as the sole provider of IT services, GM’s Locomotive Group is moving into a multi-vendor relationship, with Computer Sciences Corp. (CSC) joining EDS as an IT provider.
Most Effective Deal: Kellwood Company and EDS. In most business circles, the Kellwood Company is a well-kept secret. Although the company is the fourth largest apparel company in the U.S. and the largest producer of popularly priced clothing, their clothing does not carry the Kellwood label.
International Outsourcing: Diversity is the hallmark of the UMW group. The thriving industrial enterprise, based in Malaysia, stretches from Singapore to the Philippines to Canada, with spots in between, and engages in core businesses ranging from automotive and heavy equipment to material and environmental management. Several years ago, the company saw the need to connect all the dots on their corporate map with an Information Technology (IT) system that enabled them to gather and manage knowledge more effectively.
International Outsourcing: Executives at Grupo Nacional Provincial (GNP) know all about the value of research. Statistics and other research information are part of their day-to-day business as the largest insurance company in Mexico. Therefore, when the company was considering outsourcing part of their Information Technology (IT) functions, the first step logically was research.
Culture shock. That’s not something most would expect conservative icon Rolls Royce to embrace, but that’s exactly what the company sought in its outsourcing relationship with EDS.
There are five lines of business that will define EDS today and going forward into the next five years: we will continue to play a major role in the systems technology management arena that’s outsourcing, systems integration, development and maintenance, we’re also building a robust business process management business that’s supply source, teleservices, data mining and warehousing, imaging, environmental and safety, and logistics, consulting, cosourcing is a distinct line of business, and electronic markets card processing, electronic funds transfer, EDI, and internet/ intranet in some ways actually being a direct participant as opposed to a supplier.
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