German airline Lufthansa has contracted Dell Services to provide maintenance and support for core front-end systems in a five-year agreement that will harness offshore as well as on-site services.
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This is a good customer reference for Dell Services as the company strives to grow its IT services in the face of declining hardware sales and margins.
The agreement sees Dell Services maintain and support the Lufthansa ticketing and reservations passenger booking system. The airline expects costs savings while ensuring problems are fixed quickly.
The booking system, which is used by more than 10,000 Lufthansa workers, needs to be continuously adapted with new functionality, with typically four or five updates containing up to 80 modifications each year.
The outsourcing model enables Lufthansa to benefit from resources when required rather than having the full resources at all times.
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Dell Services has an offshore competence centre that specialises in travel and transportation.
“We were looking for an external partner who could take over the support and programming tasks so we can focus on our core business,” said Volker Machulski, senior IT development manager direct sales at Lufthansa.
“We have an elaborate booking system which supports many applications and different functions. We chose Dell because we need a reliable service provider who understands not only the software, but also the travel and transportation business.”
Dell Services in Europe is headed by former EDS/HP executive Eric Clark. Globally, former Wipro senior executive Suresh Vaswani is in charge of services. The services division covers 31 countries in the EMEA region and accounts for 55,000 of Dell's total staff of 130,000.
Dell acquired Perot Systems in 2009 for $3.9bn, where it gained significant services and offshore resources. Its approach will not be the traditional one where an outsourcer offers to do the same thing as the customer but for less money. Rather it is going to focus on transformational IT.
Michael Dell recently won his battle to privatise the company he founded in 1984 in a bid to set a new direction, including a focus on services.