Old Mutual is about to notch up further cost savings from its IT outsourcing contract with Computer Sciences Corporation in South Africa as the managed desktop phase, which standardises hardware and software on 7 000 desks in Mutualpark, Cape Town, rolls out.
On the third anniversary of the signing of the seven-year R2,1-billion deal - the biggest ever signed in South Africa - the Group Schemes division has switched over to its new PCs and connected to the newly installed Ethernet local area network backbone. This means that savings of R200 per desktop a month started to be realised in mid-August, says Richard Gordon, CSC`s Account Executive at Mutualpark.
All the desktops should be standardised and connected by March 2003. Desktop management costs are second only to Old Mutual`s mainframe costs so streamlining their operation will be a major cost saving for the company
Managing desktops brings down the costs of user support and enables CSC to deliver consistent, stable and secure applications and information to desktops faster and more reliably than has been done in the past.
Old Mutual`s IT cost savings and business benefits through outsourcing to CSC have been significant. Benchmarks completed at the end of 2001 by Gartner Dataquest found that the very tight deadlines and stringent service levels, which are the foundation of the Old Mutual/CSC relationship, show that these have been exceeded. Vic Lumby, CIO of Old Mutual`s South Africa`s division, says the company has "certainly benefited from working with CSC. We are now at the end of the third year of the agreement and still only have the cost level of 1999 - yet we get 30% to 40% more use from the system in terms of mainframe traffic and storage.
At its signing in October 1999 this deal was regarded as South Africa`s largest single outsourcing contract as it involved outsourcing Old Mutual`s infrastructure services for mainframe, midrange, local and wide area networks, desktops, servers, telephones, help desk services, a computer training center, project management services, database services and specialised software developers.
Old Mutual Group Technical Services manager Doreen Buultjens, responsible for delivering IT resources to the company`s users, says "our service levels have increased significantly since CSC became involved and the external benchmarks show these to be among the highest in the world. Together we have achieved, and in some cases, exceeded the savings envisaged in our original business case."
Ms Buultjens says this is a "once in a decade project for a major corporation like ours and its implementation emphasises that the decision to outsource to CSC was the right one".
CSC`s Richard Gordon is convinced that the mutually agreed standards for the desktop are key to slashing Old Mutual`s costs.
"In helping Old Mutual to be successful CSC is adding value by implementing standards which will add a lot of value in managing this large and complex environment. The more we can manage without manual intervention at the desktop the more effective and responsive Old Mutual`s staff will be in meeting customer expectations.
"They will gain more productive hours because the PCs are more stable and can do extra activities through enhanced software applications.
"CSC wants to ensure that we can deliver world-class services at reduced costs which will benefit Old Mutual`s position in the marketplace from a customer and shareholder point of view. Improved standards at lower operating costs will be a major business benefit and add value for the policyholders."
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