Novell outsources ERP
Novell is to outsource its enterprise resource planning (ERP) systems to Affiliated Computer Services in a five-year $135 million contract which also involves ACS paying Novell at least $30 million for Novell products for the first three years.
The outsourcing partnership involves shifting service delivery from the 156 employees of Novell Information Services and Technology group in Provo, Utah in order to produce “significant cost savings.” ACS will also buy Novell-produced solutions for the SUSE Linux Enterprise operating system, business service management, identity and security solutions and Platespin workload management. ACS will also provide SAP consulting and systems integration services for Novell as part of Novell’s global enterprise SAP roll-out.
‘This is a significant partnership with one of the leading IT service providers in the world,’ said Ron Hovsepian, president and CEO of Novell. ‘ACS will benefit from leveraging Novell solutions to provide data center services to its global clients, giving Novell a substantial new source of revenue and a new route to market. The IT outsourcing arrangement will also enable Novell to focus on its core business while giving the opportunity to substantially improve IT performance from both a financial and operational perspective.’
‘This partnership will offer key, go-to-market differentiators for both Novell and ACS,’ said Lynn Blodgett, ACS president and CEO. ‘Two innovative technology enterprises are leveraging their capabilities to respond to their clients’ fluctuating business imperatives, enabling them to respond to their own customers’ demands quicker and to improve operational efficiency.’
Novell reported a net loss of $8.7 million on total revenue of $956.5 million in 2008.