Old Mutual signs outsourcing deal with Didata

Dimension Data and Telkom will manage the communications tower of the group's South African IT estate for the next five years, focusing on delivering long-term operational savings, differentiated services tailored to user demand, and supporting the Group in its drive to become more competitive and customer-focused.

Old Mutual plc's primary operations are long-term savings and investments, banking (through Nedbank, which is one of the top four retail banks in South Africa), and short-term insurance (through Mutual & Federal).

By outsourcing selected parts of the IT operations, Old Mutual is executing a strategy that provides the Group with the best of both worlds: on the one hand, concentration on its business and on the other, premium access to global best practices and the full portfolio of technology resources offered by a global services provider.

The deal, which will be effective from 1 August 2011, is worth R2.49 billion over a 5-year term, across Old Mutual South Africa, Nedbank and Mutual & Federal.

Richard Boynett, chief information officer of Old Mutual's long term savings division, said: "In addition to delivering an IT environment that is flexible and responsive, the outsourcing deal will enable the Old Mutual Group to focus on our core business of helping customers achieve their lifetime financial goals."

The contract was awarded to Dimension Data, Telkom and Nashua. In terms of the agreement Dimension Data together with Telkom will provide all elements of the communications tower.

This covers data services (including the wide area network, branch and campus LAN environment, third party connectivity and internet access), voice services, multimedia collaboration and management services.

The contract enables Old Mutual to pursue its business and technology roadmap for the future, providing a flexible and highly responsive service that adapts to changing requirements; giving access to international best practices, procedures and skills to support the organisation's business; and delivering real, long-term operational savings that will contribute to the Group's competitiveness.

The outsourcing contract is expected to generate significant local savings for the operating businesses involved over the next five years.

Brent Flint, Services Executive: Dimension Data Middle East & Africa, describes the contract as a noteworthy endorsement of Dimension Data Services' capacity to manage complex, variable and flexible IT environments on behalf of corporations looking to focus on their core business.

Brian Armstrong, senior managing executive for Enterprise Markets at Telkom, said: "Telkom and Dimension Data have formed an industry-best partnership that offers the Old Mutual Group value and flexibility driven by a strong element of innovation."