IBM gets 1billion IT outsourcing deal from Lufthansa

ARMONK, USA: IBM has signed a seven-year 1 billion Euro outsourcing contract to deliver IT infrastructure services for the Deutsche Lufthansa AG and its Group companies. According to the agreement, which is subject in particular to the approval of the Lufthansa Supervisory Board and antitrust authorities, IBM will first optimize the airline’s IT processes to increase efficiency, which is expected to generate an estimated cost savings by an average of approximately 70 million Euro annually for the Lufthansa Group.

Over the life of the contract, IBM will bring new solutions that incorporate business analytics with mobile computing and social business to enable Lufthansa to offer new services to customers at the same time making partners and employees more productive.

“Outsourcing the IT infrastructure to IBM will strengthen the competitiveness of the Lufthansa Group as a whole. The transformation plan will directly improve our cost base. Together with IBM we will have access to the latest IT technologies not only to lower our cost but also to continue digitalizing our business processes in order to increase efficiency and customer focus,” said Simone Menne, Member of the Executive Board and CFO at Deutsche Lufthansa AG and Chairperson of the Supervisory Board of Lufthansa Systems AG.

By partnering with Lufthansa AG in this transformation, IBM will first optimize the Lufthansa IT infrastructure for maximum efficiency, make it ready for the innovation of cloud computing and then bring leading technologies in such areas as business analytics, mobile computing and social business to help Lufthansa meet its business objectives.

Martina Koederitz, General Manager, IBM Germany, said, “The agreement provides Lufthansa constant access to IBM research and development. This will enable Lufthansa to incorporate the latest technology and innovation into the Lufthansa IT infrastructure including strategic areas such as cloud computing, big data analytics or cognitive computing systems like Watson.”

IBM will begin the multi-stage transformation of the Lufthansa IT landscape by implementing leading edge collaboration and messaging tools for social business, new network and voice services, an optimized electronic workplace solution and IBM’s security framework with its leading edge security solutions and monitoring.

As part of the outsourcing agreement, IBM will manage Lufthansa Systems’ entire data center operations, help desk and printer services along with individual infrastructure services.  Around 1,400 Lufthansa Systems employees will transfer to IBM. Infrastructure services are scheduled to begin from IBM on April 1, 2015.