IBM bags (another) large IT outsourcing contract, with Goodyear

IBM has added a five-year deal to provide IT services to the tyre manufacturer, Goodyear, to its growing list of large outsourcing clients in 2002.

Kenneth Tweedie, Goodyear's IT Infrastructure Director, said: "In 1996, we decided to outsource the management of our mainframe. We had three main aims: to reduce our costs, ensure we had permanent access to the human and technical resources needed to ensure the smooth running of our operations, and to focus on the move towards the 'Client Server' world. IBM provides the best guarantees, value for money, and has kept its promises. In signing this extension to the contract, we are showing our satisfaction with them."

Marcel Origer, IBM Global Services Project Executive, said: "IBM takes charge of complete management of the hardware, maintenance of the operating system, and mainframe system tools at Goodyear. We have put in place security and emergency back-up procedures in case of any system failure. The contract also covers finance for hardware and software applications. Goodyear remains in full charge of applications product-development and maintenance."

IBM was also recently reported to be on the brink of closing an outsourcing deal with Barclays worth an estimated £100 million per year. A spokeswoman for the bank confirmed it was currently in talks with IBM but would not comment on the value of the contract involved.

UKTECH recently reported that Barclays had introduced one of the highest confirmed rate cuts for IT contractors at 20 per cent from July 1 as part of its pledge to cut costs by £1 billion over four years.

IBM, whose turnover was $35 billion in 2001, also took over IT operations at American Express earlier this year in a seven-year contract worth £2.8 billion.

However, not all of IBM's outsourcing deals have gone so smoothly. A similar deal to provide IT services to Zurich Financial Services worth approximately £400 million fell through at the last minute in November. The insurance giant, CGNU, also scrapped a seven-year outsourcing contract with IBM, worth £124m, after only two years.

IBM was also ousted from continuing to supply IT outsourcing services to the Scottish Parliament in 2000 when the Indian services company, Wipro, was chosen as its favoured supplier.

Andrew Slorance, a spokesman for the Scottish Parliament, told UKTECH at the time: "Cost is a major factor."