Telstra will outsource the bulk of its electronic billing operations and ERP systems development through the Deloitte Consulting Consortium, a services alliance between Deloitte Consulting and US computer services giant EDS.
The consortium will manage two of three major streams of IT work for the national carrier including billing software maintenance and development, and an enterprise resource planning strand covering finance, human resources and administrative IT systems.
Other service providers who lost the bid for tender were DRM and IBM Global Services Asia Pacific (GSA), according to Dwight King, Telstra MD business processes and information.
The consortium's work, worth "significantly more than a few million", was won on its low cost of implementation, short time to market and quality of work, King said.
The outsourcing deal will create cost savings of 25 per cent in Telstra's IT overheads and reduce the telco's time to market by 50 per cent within a year, according to King, who declined to put a dollar value on projected savings. Work will start in early February 2001.
A Telstra statement said 250 Telstra IT employees and contractors in billing systems administration and 90 ERP systems staff will be "offered positions within the consortium" in early December.
IBM GSA did not lose out completely in outsourcing negotiations, King told Computerworld. IBM GSA will expand its three-year application development partnership with Telstra to include work on Telstra's third strand of IT projects, incorporating customer relationship management, service assurance, wholesale and international operations, fixed and mobile network systems, and marketing IT support systems. King would not comment on the market value of the arrangement.