Fonterra shifts to Gen-i for telco services
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Fonterra has gone live with the first phase of a plan to buy its global communications services through Gen-i rather than from its long-term outsourcing partner, EDS.
A Gen-i spokeswoman says the the contract is a "significant six year deal" and is one of Gen-i's largest ever. It extends the existing relationship between Gen-i and Fonterra in both scope and geography, she says.
Fonterra’s chief information officer, Chris Barendregt, says the shift from buying these from EDS is a modernisation of the way Fonterra procures ICT services -- from a single source to a multi-source model with Fonterra retaining ownership of infrastructure.
Telecom NZ subsidiary Gen-i will provide wide area network (WAN) infrastructure and management services for Fonterra’s New Zealand and Australian sites, and desk telephony for the company's 47 global sites. Local area network (LAN) services for the New Zealand and Australian sites will shift to Gen-i later this year.
The services were previously provided by third-party suppliers through EDS. However, EDS remains the level 1 helpdesk for all Fonterra staff, Barendregt says. The move will not result in any staffing changes and nor does it signal any general retreat from outsourcing, he says.
"The nature and intent is still to buy managed services," he says.
AT&T will provide WAN and LAN infrastructure and management services for Fonterra’s sites located outside of New Zealand and Australia.
Barendregt says the move to direct telecommunications infrastructure services will provide more flexibility and reduce costs.
EDS will continue to be Fonterra’s supplier globally for core IT services hosting and storage; datacentre management, desktop support, IT security and a centralised help desk, he says.
Fonterra signed a seven-year, NZ$590 million ICT infrastructure outsourcing contract with EDS in 2003 aiming to help streamline the co-operative’s global infrastructure, and generate cost savings.
130 staff shifted to EDS as part of the changes.
Fonterra’s chief development officer at the time, Alexander Töldte, said outsourcing had enabled Fonterra to achieve its ICT vision to establish and manage Fonterra’s ICT infrastructure as an effective, integrated global services utility, operated on a “pay as you use” basis.
“It delivers a large leap forward in terms of our global ICT infrastructure service without a significant capital outlay. This infrastructure will be one of the major tools to support our business and our strategies,” he adds. Töldte adds that the terms of the contract represent significant cost savings for Fonterra over the seven-year period.
Ownership of IT assets, technology strategy and architecture will return to Fonterra under the new arrangement.
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