Infineon outsources HR administration functions to EDS

EDS and Infineon Technologies AG today announced a 10-year, multimillion-dollar business process outsourcing contract for payroll accounting and major parts of the recruiting function in Germany and Austria.

Infineon, the world`s sixth largest semiconductor company, is continuously working to slim down its corporate structures. Parts of the Infineon workforce will transition to EDS as a result of the agreement.

"By outsourcing our payroll administration and major parts of the recruiting function, we are pressing further ahead with the extensive restructuring measures planned as part of the implementation of our Agenda 5-to-1 corporate strategy," said Dr Thomas Marquardt, global head human resources.

"Taking over personnel processes is where EDS`s core competence lies, and so we can further improve the relevant services for employees for our sites in Munich, Regensburg, Dresden, Warstein and Villach and, at the same time reduce operating costs as a result of the greater transparency and control as well as gain greater flexibility."

Effective 2 January 2004, EDS will assume operating responsibility for the areas concerned, with the transfer of all processes to EDS to be completed by 1 October 2004. The quality of the outsourced functions is ensured by precise specification of service descriptions, service levels and key performance indicators.

"We have gained a first-class reference customer in Infineon in the business process outsourcing sector," commented Reinhard Clemens, EDS Regional President Central Europe. "This contract represents a milestone for EDS in Central Europe and will enable us to position ourselves successfully in this growing market."

The market research company Gartner Dataquest expects the readiness of companies to outsource their human resources administration to an external service provider to increase significantly over the next two years. According to a study released in July 2003, the market for HR business process outsourcing is expected to grow by 11% over the previous year, to a total of US $27.9 billion worldwide. The volume is forecast to reach US $37.8 billion in 2007. Moreover, the aim is not only to reduce costs, but also to improve services.

EDS BPO allows clients to unlock business efficiencies, break down operational silos, streamline business processes, and get a complete view of their employee, customer and vendor relationships. As an example, EDS clients have realised up to 50% growth and three times faster sales cycles, while reducing costs 15% to 30% or more through CRM contact centre services. At the same time, clients benefit from EDS`s people and technology, without having to make those investments on their own.

EDS BPO includes customer relationship management http://www.eds.com/services_offerings/crm/crm_main.shtml (CRM), financial process management http://www.eds.com/services_offerings/so_ftp.shtml (FPM) and administrative and enterprise shared services, which includes human resources http://www.eds.com/services_offerings/so_hr_support.shtml, finance and accounting http://www.eds.com/services_offerings/so_fincacct_overview.shtml and procurement services http://www.eds.com/services_offerings/so_pbpo_overview.shtml.