AA cancels £50m IBM outsourcing contract

The AA has replaced its IT management team and cancelled its £50 million outsourcing contract with IBM, two weeks after the EC approved the sale of the AA to Saga's private equity owners, Charterhouse.

The AA has replaced its IT management team and cancelled its £50 million outsourcing contract with IBM, two weeks after the EC approved the sale of the AA to Saga's private equity owners, Charterhouse.

The AA will end the five-year, £50 million contract with IBM to build and run a new IT infrastructure for roadside recovery, which it signed in January 2005.

"We will be ending our relationship with IBM over the next 12 months," an AA spokesman confirmed.

AA and Saga will continue to trade as separate companies, although a group management team will oversee areas such as finance and IT, a Saga spokeswoman said.

Andrew Gisby, former IT manager at Saga, replaces Trevor Didcock as the AA's IT director. Didcock joined the AA in 2004, six months before private equity group CVC Capital Partners and Permira purchased the AA for £1.7bn from Centrica.

Didcock left the AA as a result of the merger and following a review of management, an AA spokesman confirmed. Jim Cameron, former IT director at Saga, will be group IT director over both the AA and Saga. Gisby will report to Cameron.

A study commissioned by the GMB union in August accused the AA of under-investing in new laptops for patrols. The AA categorically denied the claims made by the GMB's report and said it had invested £37m in its IT infrastructure over the past three years.

"As would be expected in any market-leading business, plans and the necessary investment - around £9m - are already in place for replacing the Vixen unit, which may not be a laptop-based unit. Technology moves on and we will implement a replacement at the appropriate time," an AA spokeswoman told Computer Weekly in August.

A spokeswoman for Saga said that the firm would continue to make significant investments in the AA's IT systems following Didcock's departure.

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