Sainsbury Signs IT Management Contract with Andersen Consulting

Business Wire, Dec 8, 2000

Business Editors

LONDON--(BUSINESS WIRE)--Dec. 8, 2000

J Sainsbury plc and Andersen Consulting announced the recent signing of a seven-year contract that calls for the leading global management and technology consultancy to manage the U.K. supermarket's information technology (IT) infrastructure. The agreement aims to radically improve Sainsbury's business efficiency and effectiveness by modernising its IT systems, thereby achieving significant cost savings.

Under the agreement, which became effective November 12, 2000, Andersen Consulting will take responsibility for all aspects of Sainsbury's IT services, including operating existing systems and networks, developing and installing new systems and managing third-party contracts. Additionally, the arrangement includes a transfer of approximately 800 Sainsbury IT employees to Andersen Consulting, which will be renamed Accenture on 01/01/01. Sainsbury originally announced its decision to team with Andersen Consulting and negotiate a final contract on August 22, 2000.

"Driving change in our IT capabilities is a fundamental part of our business transformation plans," said Peter Davis, Sainsbury's group chief executive "Many of the changes we need to make are IT-dependent, and Andersen Consulting's excellent IT skills and retail industry experience will help us achieve real competitive advantage and efficiencies quickly and cost-effectively."

Sainsbury currently spends in excess of (pound)200 million a year on its supermarket IT systems and operations. Over the seven years of the contract, the company's IT costs will be approximately (pound)35 million per year less than if Sainsbury continued to manage and operate its own IT function.

"This agreement is consistent with our strategy of teaming with clients to create innovative arrangements that deliver value far beyond traditional outsourcing," said Robert Willett, global managing partner, Andersen Consulting Retail practice. "We are committed to helping Sainsbury achieve repeatable, ongoing value that will transform customers' shopping experiences and differentiate Sainsbury from its competition."

"Over the next two and a half years, Andersen Consulting will renew all our key systems, replacing legacy systems with best practice retail packages," added John Adshead, Sainsbury's group board director for IT. "Early implementation of new office systems and improvements to our eCommerce and HR systems are planned for April 2001. Within the next year we will have replaced our point-of-sales systems and substantially upgraded our category and customer relationship management systems. By the end of the programme, all major systems, including depot and store replenishment, will have been renewed."

About Andersen Consulting

The Andersen Consulting Retail practice, with more than 2,000 industry professionals around the globe, has worked with more than 450 retail clients worldwide -- including fifteen of the top twenty retailers. In addition to systems integration work, we have helped retailers create value for their customers and shareholders in all segments of the industry, including: merchandising, marketing/advertising, procurement, store operations, real estate, human resources and electronic commerce.

On January 1, 2001, Andersen Consulting, the $8.9 billion global management and technology consulting organization, will change its name to Accenture (pronounced: ak-SEN-chure, similar to "adventure" and stressing "accent" "future"). The firm is reinventing itself to become the market maker, architect and builder of the new economy, bringing innovations to improve the way the world works and lives. More than 65,000 people in 48 countries deliver a wide range of specialized capabilities and solutions to clients across all industries. Under its strategy, the firm is building a network of businesses to meet the full range of client needs -- consulting, technology, outsourcing, alliances and venture capital. Andersen Consulting's home page address is http://www.ac.com