The financial services company has signed a £1m business analysis contract with CMG Admiral and an agreement with India-based Wipro Technologies for development work.
Mike Shapland, Friends Provident's head of business liaison, said, "Because of the large number of projects on the books in 2001 we needed to grow numbers quite rapidly. It would require a big learning curve to train people for the work, so we had to outsource to meet the project deadlines.
"We have minimised the risk of using two outsourcing companies by ensuring that they work on different projects and that our own people are always involved."
Friends Provident had wanted to outsource all the work to one company but felt Wipro did not have enough knowledge of its business processes for the analysis side of the projects.
The company requires major development work this year because demutualisation has led to a change in its accounting processes. It is also working on automation to cope with stakeholder pensions and is investing in customer relationship management systems.