outsourcing; Goodyear to save [pounds sterling]30m from BPO
Daniel Thomas
daniel.thomas@rbi.co.uk
The European arm of tyre firm Goodyear Dunlop expects to save more than [pounds sterling]30m in the first two years after signing a 10-year business process outsourcing contract with IBM.
Under the deal, IBM will take control of much of the procurement process for indirect supplies. The contract forms part of Goodyear Dunlop Tires Europe’s efforts to reduce overall costs by [pounds sterling]800m by 2005.
Although Goodyear Dunlop will retain its core purchasing competencies, the activities of between 50 and 80 employees will be transferred to IBM. The main savings will be achieved by using IBM’s procurement organisation, which will negotiate on behalf of Goodyear Dunlop.
The procurement-to-payment project will establish a consolidated system across 15 countries, mandating a strict procurement process for all employees.
Indirect supplies include telecoms, IT, business travel, office supplies, marketing and advertising, manufacturing main-tenance, repair expenses and professional services. They do not include the purchase of raw materials.
Michael Roney, president of Goodyear Dunlop Tires Europe, said, “This outsourcing programme enables us to obtain major cost savings.”
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