GM bringing IT back in-house

Automaking giant General Motors Corp. is bucking the outsourcing trend, apparently bringing IT back in-house after years of outsourcing the work to Hewlett-Packard Corp.

The company figures it can do this by consolidating its worldwide data centre count to two from 23.

HP bought GM’s technology services arm, EDS, back in 2010, part of HP’s strategy to pursue IBM Global Services. In turn GM outsourced its IT, primarily to HP, which signed a $2-billion-a-year deal with the carmaker.

Now GM CIO Randy Mott reasons that consolidating to two data centre, shedding applications, and hiring thousands of new developers will save the company money on its IT spend. Mott should know this; as CIO of HP, he presided over the company’s consolidation to six worldwide data centres.

Mott was fired by HP back in 2011.

Story author Chris Mellor raises an interesting point: A services firm would never recommend the consolidation of data centres, since it would cost it revenue. So doesn’t that put HP in a bit of a conflicted position, feeling its best practices for its own IT don’t apply to its services customers?

Read the full article here.



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