Member services organisation the Royal Automobile Club of Victoria (RACV) has signed a multi-million-dollar five-year outsourcing deal with IBM Global Services.
IBM will host RACV's mainframe applications and manage its mid-range environment and applications.
IT&T general manager Charles Burgess said the deal was part of the RACV's transformation to an "on-demand" IT environment where cost and capacity was linked to usage.
"IT is not our core capability and it makes sense for us to build a strong relationship with a partner who has the capabilities to manage it for us," he said.
"We are moving away from owning our own IT infrastructure. We would prefer to access IT as a service and pay for it based on the computing resources we use in each of our individual businesses in an on-demand hosting environment."
Burgess said RACV wanted greater predictability and transparency of IT costs and that IBM provided fixed-price charges for application maintenance and fixed-price quotations for application enhancements that could be market-tested at any time.
"Our agreement is structured so that IBM takes responsibility for supporting our business outcomes, rather than being only focused on detailed contractual measures of performance," he said.