October 29, 2005
World retailer Sainsbury decides to end IT outsourcing contract with Accenture
Worldwide retailer giant Sainsbury signed a ten-year IT outsourcing contract with service provider Accenture in 2000 with ambitious plans of saving the company about £35 million per year. However, five years down the line, the company has decided to end the contract prematurely, and aims to bring its IT business processes back within its own fold in 6-12 months' time.
According to a senior analyst at researcher Ovum, the outsourcing relationship did not work out as planned because of various reasons, including poor decision-making, weak outsourcing governance, political conflicts at the retailer’s end, and too many high-risk factors. Silicon.com reports:
Key IT development will continue as planned, the retailer said. It said the priority throughout the migration period will be to make sure customers and staff are unaffected by the change, particularly through the Christmas and Easter trading periods.
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