By Tony Hallett, 3 September 1998 00:30
NEWS Cable & Wireless Communications (C&WC) and IBM have ended weeks of speculation and confirmed a £1.8bn ($3bn), ten year outsourcing deal. Big Blue's Global Services business will take control of nearly all of C&WC's IT operations, inheriting 1,000 staff. C&WC said savings made through the partnership will be reinvested in IT to improve business efficiency and customer service. C&WC said the deal will also lead to 400 new jobs - a development which should appease the Communications Workers' Union (CWU). Throughout negotiations, the CWU said it remained "sceptical" about the long-term future of C&WC employees. C&WC has a policy of not recognising trade unions. In spite of outsourcing not being particularly popular in the telecoms industry, Graham Wallace, CEO of C&WC, said improvements will be realised "much more quickly and effectively as a result of this partnership by harnessing the skills, experiences and the global resources of IBM". C&WC will stay in control of IT strategy and systems security through a small in-house team, which will also be responsible for managing the IBM relationship. As part of the deal, IBM said its telecommunications unit will establish a customer support centre for Integrated Customer Management Systems in the UK.
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