Thomas Cook turns to India to cut foreign development costs

Travel group saves more than £2m by turning its project over to India's high-skill, low-cost programmers

Travel group saves more than £2m by turning its project over to India's high-skill, low-cost programmers

Bill Goodwin

Travel group Thomas Cook has saved more than £2m by outsourcing to India an IT system for its foreign currency and travellers' cheque business.

Thomas Cook Financial Services, the latest British firm to take advantage of India's pool of skilled programmers and low labour costs, completed the project for £3m - about half the cost quoted by western software suppliers.

The group's Atlas foreign exchange system, which went live in June last year, has allowed Thomas Cook to triple the number of orders it can process each hour at its Peterborough call centre, with 10% fewer staff.

The system records orders taken by Thomas Cooks' call centre staff, supplies the group's currency buyers with up-to-the-minute details of the notes in stock, and prioritises deliveries from a dispatch centre to banks.

Atlas's single integrated system replaced the 17 incompatible legacy computer systems, thereby significantly reducing staff training costs.

The move will allow Thomas Cook to expand the services it offers to banks and building societies in Europe and the US.

Thomas Cook's head of development, Neil Hammond, said the travel group is keen to provide outsourcing services to an increasing number of banks and building societies that are handing the management of their foreign currency operations to third parties.

The development contract for the Atlas software, Thomas Cook's largest IT project to date, was awarded to Bangalore-based firm Wipro Technologies.

"When we went to India to look at Wipro, it demonstrated that it had the ability to construct and manage a large IT team," said Hammond.

"One of the drivers was, it was able to come in with a fixed price, fixed date contract."

Wipro was also significantly cheaper at £3m, compared with bids from European software suppliers of £5m-£7m.

A team of five analysts, 33 programmers and nine quality control staff from Thomas Cook and Wipro designed, tested and implemented the system, which went live within nine months.

Thomas Cook and Wipro plan to extend Atlas to allow banks and building societies to order currency and travellers' cheques over the Internet, as well as by telephone, fax and dedicated computer links.

The system will initially supply one bank with 200 branches, but by next year, Thomas Cook hopes to serve Internet orders from 4,000 branches.

Atlas mapped out

The system

  • 120 Windows 95 and Windows NT desktops

  • 4 RS/6000 servers running Unix 4.2

  • Atlas software developed in Visual Basic

    The timetable

  • June 98 -contract awarded to Wipro

  • August - programme design completed

  • November - first subcomponent delivered

  • December - second subcomponent delivered

  • January 1999 - third subcomponent delivered

  • February - final version of software delivered

  • June - system goes live

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