Aviva outsources datacentre management in £700m EDS deal

Aviva was formerly Norwich Union

Insurance group Aviva has signed a £700m datacentre services deal with EDS that should help it to focus more on business-critical areas and cut costs.

The 10-year agreement is intended to reduce costs associated with maintaining equipment and staff at two Norwich datacentres and allow the company to concentrate on areas that provide competitive advantage.

“We needed to make decisions around where we want to focus our in-house resources and concentrate in areas where we bring intellectual capability to business advantage,” said Malcolm Simpkins, UK IT services director at Aviva.

“Applications development, management, architecture and strategy are areas where we make a real difference, whereas we see infrastructure increasingly becoming a commodity as we move towards a lot more virtualisation and service-based environments, and especially during the current economic conditions,” Simpkins told Computing.

The modernisation process should take 12 to 24 months to complete, after which EDS will remain responsible for the management of Aviva’s mainframe, midrange and Windows servers.

“After the modernisation has taken place, I expect we will be able to see significant savings, which will then be passed on to the business. We have also structured the deal in a way that will allow flexibility to support future growth,” said Simpkins.

As part of the deal, some 300 Aviva staff are being transferred to EDS under a TUPE arrangement. The insurer said that no employees have been made redundant as a result of the agreement between the two firms.