IBM has been awarded a seven-year outsourcing deal with Unilever.
The agreement is expected to affect around 750 Unilever staff across 20 countries, and has been made through the One Unilever program.
As part of the deal, IBM Business Consulting Services (BCS) will be using its facilities in India, Poland and Portugal to deliver the requirements. The agreement covers significant parts of Unilever’s financial transactional services, including its Purchase to Pay, General Accounting, and Bill to Cash functions.
IBM is one of Unilever’s key technology partners, and following the announcement last year of the One Unilever program, with annual savings of E700 million being targeted, it is no great surprise that IBM BCS was selected. Unilever stated that it was looking for a small number of large, mature suppliers with a proven track record in delivery and support, in order to streamline and simplify the regional IT of the company. Unilever believes the IBM deal will help improve the company’s business process performance and allow additional savings to be made.
The deal amount has not been specified, but will undoubtedly be large.
Unilever said it will follow a phased implementation approach over approximately two years, beginning in Q1 2006. This means 2006 looks set to be a big year for Unilever and IBM BCS in the outsourcing world, and there will no doubt be other organizations, large and small, following in their footsteps.
There will also be plenty of people watching for slip-ups in this agreement, keen to ensure that any negative aspects of the deal are brought to the attention of those who may be slightly skeptical about outsourcing, but are under pressure to consider it.
One thing for certain is that outsourcing is set to remain high-profile throughout 2006.
Source: OpinionWire by Butler Group (www.butlergroup.com)
