HP expands IT deal with Delphi

Hewlett-Packard has landed a contract to manage business-software systems for automotive supplier Delphi, HP said Thursday.

Under the terms of a five-year agreement signed in September, HP will run Delphi's SAP software for North America and Singapore from an HP data center in Toronto. The outsourcing agreement comes after a 2001 deal calling on HP to consolidate Delphi's SAP systems for Western and Eastern Europe. HP has also hosted Delphi's SAP software in North America since 1999. New features in the latest contract include an expansion in the number of SAP users and a disaster-recovery system.

HP Services chief Ann Livermore wouldn't give a precise figure for the value of the latest deal, saying only that it was worth "more than tens of millions" of dollars.

The company beat out two major rivals for the most recent Delphi contract, according to HP spokeswoman Kellie Harris, though she declined to name them. An InformationWeek study of 700 business technology professionals, published in November, found that HP ranked first in customer satisfaction among business technology outsourcers, scoring higher than IBM, Electronic Data Systems and Accenture.

In the deal announced Thursday, HP will run Delphi's SAP software and other business applications on 25 HP-UX server computers and 35 ProLiant servers running Windows NT. HP also will provide consulting, technical support services and a disaster-recovery system involving both hardware and data center redundancy; a mirror site will back up and store data 11 kilometers away from the main site holding Delphi's information.

Outsourcing deals like the HP-Delphi agreement represent a bright spot in a dreary information technology spending climate, as companies have focused on trimming costs. IBM, EDS and HP all have announced significant IT outsourcing contracts in the past few months. HP's managed services unit grew 14 percent year over year in the October quarter. Overall, HP's services division--which also includes customer support and consulting and integration units--saw its revenue fall 3 percent year over year to $3.1 billion.

HP Services accounted for 17 percent of the company's $18 billion in revenue in the October quarter.