Welsh Water has signed a £100m outsourcing contract to transform its business processes and overhaul its IT systems.
The deal, with CapGemini, LogicaCMG and TCS, is one of the largest signed by a UK utility.
It involves major hardware replacements and a move from legacy software to a fully integrated SAP enterprise resource planning system. The company should start to see a return on its investment within five years, says head of IT Fraser Nairn.
‘In the past we have not invested a great deal in IT, and we want to update all our systems to give much better services to our customers and bring big efficiencies into the business,’ he said.
‘We have a lot of legacy technology, and the water industry as a whole is moving on with IT transformations. We are behind and want to catch up.’
Training 2,500 employees to use the systems over the next three years will be one of the biggest challenges, says Nairn.
But the IT is urgently needed to help the company make the most of the knowledge and expertise of its staff, he says.
‘Forty per cent of our asset workforce will be retiring by 2015. We want the knowledge those people have to be there for the company, locked down into process,’ said Nairn.
‘If we do not, that knowledge will leave the business for ever.’
A deal of this scope and scale will rely heavily on employee and supplier skills, says Butler Group analyst Alan Rodger.
‘It is vital that they have lots of people on board who have experience of dealing with a deal of this size,’ he said.
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