Philips in $250m outsourcing deal

22 August 2007
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23 August 2007 | Paul Snell

Electronics manufacturer Philips is to outsource part of its procurement team, but jobs in that department will not be cut.

Last month the Dutch firm signed a $250 million (£122.7 million) deal with Indian outsourcing provider Infosys. It covers finance, accounting and some transactional procurement, including the processing of purchase orders and hosting and maintaining the company's ERP system.

Around 100 procurement staff are among the 1,400 that are due to be transferred to work for Infosys in centres in India, Poland and Thailand.

A Philips spokesman told SM: "Employees will have better job prospects and career opportunities are probably improved by working there." Neither firm would comment on the amount of procurement spend Infosys would process as part of the deal. In 2006, 70 per cent of Philips's spend was centralised and the company halved its number of suppliers to 25,000. This was part of a transformation programme led by chief procurement officer Barbara Kux.


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