Given that the only way to make it pay is to consolidate work from several customers on a reduced number of mainframes, it is far from clear that facilities management is a business that IBM Corp should be encouraging or crowing about, but its Integrated Systems Solutions Corp in Tarrytown, New York has won its biggest contract yet – $3,000m over 10 years from McDonnell Douglas Corp to take over essentially all its data processing activities. But at the front end, it is all cost to IBM – the pay-off, if any, comes only later. Upfront, it has to buy – on undisclosed terms – the planemaker’s information services business, cutting McDonnell’s payroll by about 1,450 people. Under the agreement, Integrated Systems will buy and run McDonnell’s information systems, which range from mainframes to desktop workstations and speech and data communications. The services were previously provided by McDonnell Douglas Aerospace Information Service, the assets of which effectively pass to IBM. The company sees big savings from the contract, but would not quantify them. McDonnell will retain a very small part of its software applications development operation that relates directly to aircraft design and development. The information arm has been responsible for running McDonnell’s computer centres in St Louis, Missouri and in southern California, where the Douglas Aircraft unit is based. Integrated Systems will lease the 74-acre facility that houses the St Louis computer centre, and will offer jobs to about 800 employees in St Louis, 650 in California at equal to or better terms; the unit, which had 11,000 staff before the new deal, has pacts with 35 major US firms.
