International Business Machines Corp. (IBM), Monday said it signed a seven-year agreement to manage and maintain the global back office operation of packaged meat products manufacturer Sara Lee Corp. (SLE). IBM has also been granted "preferred supplier" status for future information technology applications development activity.
The seven-year deal requires IBM to manage a portion of Sara Lee's North American and European Finance (transaction processing) as well as Global Information Services groups (applications development and maintenance). Global indirect procurement activities of Sara Lee would also be managed by IBM.
Sara Lee noted that it is simplifying its organization to achieve efficiencies through process discipline, functional centers of excellence, integrated supply chains and outsourcing. The transfer of activities, however, would happen in a phased manner in accordance with local consultation requirements.
Finance & Accounting Solution intends to provide significant savings to Sara Lee by utilizing IBM's Manila Global Delivery Center and with onsite F&A professional support during the transition process.
Armonk, New York-based IBM would set up Sara Lee Centers of Excellence in India, where Application Development and Maintenance Service would be provided for Sara Lee's global operations. Indirect Procurement Services of IBM has also been integrated with Sara Lee's accounts payable to enable compliance and drive savings.
IBM is currently trading at $79.90, down $1.43 or 1.76%, on a volume of 1.07 million shares.
SLE is currently trading at $9.30, down $0.12 or 1.27%, on a volume of 0.49 million shares.
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