Piece Of Cake: Sara Lee Outsources To HP

The confectioner is turning to Hewlett-Packard for help with infrastructure management.
Food and beverage purveyor Sara Lee will hand off management of its North American IT infrastructure to Hewlett-Packard under a seven-year services contract extension announced Wednesday. Financial terms weren't disclosed.

The extension brings Sara Lee's commitment to HP through 2015 and adds previously excluded North American operations to the deal. HP has supported Sara Lee in Europe, the Middle East, Africa, Latin America, and Asia since 2000.

The new contract will help Sara Lee "increase efficiencies and further supports our goal of operational excellence," said Steve Merry, the company's CIO, in a statement.

HP's EDS unit also disclosed a contract extension this week.

EDS landed a four-year, $531 million extension to an existing outsourcing agreement with direct marketer Guthy-Renker. The agreement, for consumer direct, business process outsourcing services, applies to Guthy-Renker operations in the United States, Canada, Australia, and New Zealand.

Under the deal, EDS will develop and deploy global, fully integrated order management and CRM systems for Guthy-Renker. The system is designed to allow the marketer to quickly add new products and promotions. It should help Guthy-Renker "identify and capture new revenue opportunities," said Mike Klaus, EDS's VP for global consumer industries and retail.

HP acquired EDS this year with an eye to growing its footprint in the outsourcing market.

In one stroke, the merger created the world's second largest IT and business services company, next to IBM. The combined services revenue for EDS and HP last year was, pro forma, $38 billion, compared with $54 billion for Big Blue.