GM Will Outsource $15B in IT Work

On Tuesday, General Motors released a list of IT suppliers who will provide it with systems integration services to the tune of $15 billion over the next five years, according to the company’s Feb. 2 release.

The contracts go to EDS, HP, Capgemini, IBM, Compuware Covisint and Wipro.  The move was driven by a 10-year split-off agreement between GM and EDS, which is set to expire in June.

GM is struggling to cut costs and restructure operations after the company posted a loss of $8.6 billion dollars in 2005, Reuters reports.

“This is a significant milestone for General Motors and it’s Information Systems & Services Group,” said Ralph Szygenda, GM’s CIO and group vice president. “Of critical importance is the focus we have had on driving innovation and supporting future globalization and digitization of the company.”

EDS will have the most business at GM, with contracts worth $3.8 billion over the five years.

“Over the next five months, we will focus our efforts on assuring a smooth transition,” Szygenda said. “Our primary goals are to avoid any business disruption and ensure our efforts fully support the company’s global operations.”

Read Multiple Choice Answers to learn how to manage multiple outsourcing vendors.

-Al Sacco