General Motors Corp. isn't the only troubled automaker looking to run a more-efficient IT shop. Under a new outsourcing deal, Ford Motor Co. is driving toward a more-simplified IT operation by centralizing key technology operations and aggressively adopting standards.
Members of TechTeam's Ford support group at the automaker's Allen Park, Mich., call center.
In a three-year support contract it signed with TechTeam this month, worth $75 million to $90 million, Ford is looking to resolve remotely many routine problems the help desk handles, such as frozen applications. "We're creating a centralized 'super team' that will try and diagnose and correct problems without having to dispatch someone," says Irene White, Ford's manager for support services.
White hopes to achieve her goal by using help-desk-automation software that can be managed remotely from a central location. "Some of the tools are proprietary, some are off the shelf," she says, declining to detail the technology. The changes are happening at the same time as a big change in IT leadership: George Surdu, Ford's longtime director of IT services, retired last week and is being replaced by Mark Duhaime, the automaker's director of IT security.
The effort, which Ford has been piloting for a year and launched in full this month, extends throughout the company's worldwide operations. TechTeam devotes 350 to 450 staffers to Ford's desktop-support operations at any given time, many from a center in Dearborn, Mich., where Ford has its headquarters. If White's plan works, that number could be reduced, potentially saving Ford millions of dollars. TechTeam's fees are tied to the number of staff hours used to support Ford.
Ford needs to cut costs wherever it can. In its most recent quarter, the company's North American auto operations lost $1.2 billion pretax. And, like GM, it's struggling with health-care costs, foreign competition, and consumers' waning taste for gas-guzzling SUVs.
Ford's next possible step toward reducing help-desk costs: offshoring. "Anything you can centralize becomes a candidate for offshore savings," White says. Ford is evaluating a new TechTeam-operated support center in Bucharest, Romania, as a possible home for its desktop-support operations.
The decision will hinge on evaluating potential cost savings, quality, and whether TechTeam can meet its service-level agreements from an offshore site, White says. TechTeam sales and marketing VP James Hoen says Eastern Europe offers low costs and also a multilingual workforce, "something you typically don't find in India," where English is the main business language.
Under the new contract, which extends a previous relationship with Ford, TechTeam is being asked to handle a bigger chunk of car company's global help-desk operations. The deal adds TechTeam support functions to Ford's Jaguar, Land Rover, and Aston Martin divisions. It's part of a companywide effort to defragment and standardize operations, White says. Aggressive use of industry standards, such as the Information Technology Infrastructure Library in Ford's IT operations, also is part of the program.