An Outsourcing Challenge by Schneider Electric

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[Success at winning hearts and minds of almost 600 people across Europe] marks first anniversary of partnership between Schneider Electric and Capgemini.

“This project is not about IT. It is about people and change, and how we manage both elements. For us, the relationship with Capgemini is absolutely critical. There is no way we could do it on our own.”

Hal Grant, Executive VP, Globalization & Industry Division, Schneider Electric

“When we decided to go for outsourcing, we wanted to have a first class company to solve this for us. There are only a certain number in the top league but they all have similar technical capabilities. With Capgemini there was a strong cultural fit and they reacted in a very proactive way during the tender process.”

Barthold Veenendaal, Head of IT & Business Transformation in Europe, Schneider Electric

“Our joint vision is to get our IT costs down to about 2 1/2 % of sales. With Capgemini, we had a substantial business relationship and a deep understanding of each other. With that, we have a great platform to build upon”

Hal Grant, Executive VP, Globalization & Industry Division, Schneider Electric

The Situation

Schneider Electric, strategically focused on automation and electricity management, is a recognized world leader in its field.

Having witnessed strong organic growth, the Group faced challenges of harmonizing processes across its heterogeneous legacy organizations and optimizing global IT costs.

Addressing these would reap major business benefits and ensure Schneider Electric enhanced its industry position.

The Solution

Part of the solution lay in outsourcing IT activities in some 31 European countries. At its core, the solution entailed management of all applications and infrastructure and transfer of over 1000 professionals to an external partner. What was obvious to Schneider Electric was the Herculean scale of the task to hand!

Management sought a partner who could bring real value by helping the Group to transform its IT infrastructure, consolidate a portfolio of data centers serving 31 European countries and standardize operating systems through a group-wide implementation of SAP.

Schneider Electric and Capgemini have a history of successful partnership over many years. As a result, discussions were successfully concluded in November 2004 with both companies signing a 10 year contract worth € 1.6 billion.

The Result

The first anniversary of the enterprising partnership offers an opportunity for management at Schneider Electric to measure Capgemini’s service. Winning hearts and minds of people previously with Schneider Electric and destined to join Capgemini was key to success of the program.

The team will have successfully transferred almost 600 people across 26 countries by the first anniversary (5 countries were not subject to transfer of people). As a significant tribute to the critical HR element, very few people elected not to transfer. Despite some reservations, the majority welcomed the change.

Overall results impacting the whole program included:

  • Delivery of new functionality to help grow Schneider’s business.
  • Management of people, and the ensuing scale of change, was seen as critical to success at meeting objectives.

The results facilitated a solid platform for the next stage in the program.


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