Applications outsourcing will form major component of business growth as organisations seek continued cost reductions
London, 19 April 2010 - Fujitsu has announced an ambitious 3-year plan to grow its Applications Division, expanding the number of existing Fujitsu customers and growing the number of new customers within the business. Fujitsu will aim to double revenues for the business by 2013; this growth will be overseen and driven forward by new Applications Division managing director, John Hanley who was appointed this month.
Fujitsu’s Applications Division is a well established innovation hub within the company, offering a range of services for business-critical applications. In particular, Fujitsu has established a reputation for delivering application projects into the public sector.
It is responsible for providing the services which underpin some of Fujitsu’s most prestigious contracts, including:
Environment Agency’s flood warning solution, which protects over five million people in two million properties
Rail Journey Information System (RJIS) enquiry system which handles over one million enquiries from rail passengers every day
Centrica’s Tariff Gas Billing system, the world’s largest gas billing system at the time, including migration of 19 million customer records from over 30 regional systems
The decision to invest heavily in this area of Fujitsu’s business reflects the market opportunity which has been identified and the ability to meet the business challenges which CIOs face in the current market. ‘Applications outsourcing’ will form the cornerstone of Fujitsu’s aggressive growth into the applications market. In anticipation of this, Fujitsu recently commissioned original research with London Business School to understand the dynamics of the Applications Outsourcing market and gain the views of leading CIOs. The report “Making Application Outsourcing Successful: Business, IT and Competitive Advantage,” will be launched later this month and generated the following insights:
Let sources of competitive advantage determine what to outsource and what to keep inhouse. Application Outsourcing decisions must be made in the context of competitive advantage in order to avoid impairing a company’s ability to operate effectively. Study participants made clear that understanding the sources of competitive advantage within their organizations was essential to making appropriate decisions about which applications (or parts of applications) should be outsourced and which should not. Applications that support areas of competitive advantage and are subject to frequent change are typically not best suited to Application Outsourcing.
Anticipate the need to manage continuous change. Like the business processes they support, business applications are constantly being modified and adapted. This doesn’t change once they are outsourced. While all IT outsourcing requires ongoing fine tuning, this is even more the case for Application Outsourcing.
Seek to develop business performance measures, not just IT or financial measures.
Depending on the type of applications outsourced, this may be more or less difficult to accomplish. At a minimum, understanding the perception and satisfaction of users within the business is an important indication of how well an Application Outsourcing engagement is running.
John Hanley, managing director, Applications Division Fujitsu UK and Ireland, commented: “Organisations face an increasingly complex environment when making decisions about business applications. First, there are continuing business pressures in terms of reducing cost, developing greater agility and efficiency, improving process and attracting and keeping customers – and the need to align applications to support the business in these areas.
“Second, there are specific IT operational challenges which need to be overcome: changes in application software, upgrade decisions, maintaining legacy systems and managing and evaluating complex application portfolios, often with limited resources. These organisations are looking for IT services companies who can meet these operational challenges and thereby help to solve their wider business issues.”
As well as a solid base of existing customers Fujitsu has a range of well-formed and strategic partnerships with leading software and application providers. These include:
Oracle - Fujitsu has more than 400 in-country Oracle consultants, making it one of the largest practices in the UK
SAP - Fujitsu is one of only three SAP partners globally to be accredited for hosting, services and technology
Salesforce.com - Fujitsu is one of salesforce.com’s biggest global UK partners with over 75 implementations
Hanley concludes, “There is no doubting that Fujitsu has the relationships and abilities to achieve its growth targets – this is proven by our strong track record and experience. We now have the challenge to evolve the Applications Division from the IT industry’s best kept secret, into industry-leading innovators.”
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