Jean-Marc Lazzari, head of Unisys’ operations in continental Europe, told Computer Business Review that he knows of up to 10 deals worth between 700m euros ($888m) and 1.5bn euros ($1.9bn) that are already back on the market despite having been signed less than two years ago.
Lazzari said Unisys is positioning itself to take advantage of the fact that it believes many of these deals will be split up in a best-of-breed approach, and that it will look to win deals where it can utilize its enterprise security expertise.
A number of large contracts are up for renewal between now and the end of next year. According to ComputerWire’s IT Services Contracts Database, 26 deals worth $500m or more are due to expire by the end of 2007, worth a total of around $31bn.
According to Lazzari, the incumbents will find it difficult to retain their clients. No one will go back and just renew their deal, he said. These deals were based on the ‘your mess for less’ principle and they are in danger as the supplier often did not get the volume of work expected from the client, and the client didn’t get the expected cost savings.
Unisys is still in a transitional period after a disastrous 2005 during which the performance of two of its UK-based BPO contracts caused major losses. As a result, Lazzari said the company is being very selective in BPO.
Its poor financial performance led it to slash its workforce by 5,500 people, and restructure its portfolio. It is belatedly accelerating its offshore plans, and expects to have 6,000 people in centers in India and China by the end of the year.
Lazzari, who joined Unisys from IBM almost a year ago, admitted that the company had realized that it could never be a mini-IBM. He added: we had too many things in too many industries. It is in the process of divesting certain business units, and will now focus on five key areas: outsourcing, enterprise security, open source services, Microsoft services, and real-time infrastructure.
