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In a move intended to help Electronic Data Systems Corp. go after disillusioned Big Five consulting clients, the services giant today announced it will reorganize its three largest business units.
EDS will combine the significant applications services portfolio of its Information Solutions unit with its fast-growing E Solutions implementation consulting division into a new Solutions Consulting unit. That move, intended to give EDS a leg up on Big Five competitors, will create a $7 billion consulting business with 40,000 employees, according to an EDS spokesman. The E Solutions unit last year had grown into a $1.2 billion business unit with 5000 employees.
At the same time, EDS will pull together its IT outsourcing and business process outsourcing businesses into a new Outsourcing Solutions unit. That move is intended to boost EDS¡¯s competitive stance against IBM Global Services, which does not emphasize business process management, the spokesman said.
EDS has seen recent outsourcing contracts combine elements of both. ¡°The one thing that¡¯s common to IT outsourcing and business process management — those transactions have to ride on a robust IT backbone, no matter what types of transactions you are doing,¡± said the spokesman. EDS had separate sales forces for business process management and IT outsourcing that will now merge into a single organization.
Heading up the new Operations Solutions unit is Doug Frederick, formerly president of Information Solutions. He was named executive vice president and sector executive of that unit. Paulett Eberhart, president of Information Solutions U.S., was named president of Solutions Consulting. Both will report to Dick Brown, chairman and CEO of the Plano, Texas services firm. Patricia Engels, president of the Business Process Management unit, will continue in her current post, but she will report to Frederick. E Solutions President, John McCain, announced his intention to leave EDS.
EDS also named Paul Chiapparone as vice chairman of EDS, replacing Jeffrey Heller, who retired from that post in February.
No layoffs are planned as a result of the reorganization.
A.T. Kearney, EDS¡¯s management consulting arm, will remain a separate unit. The changes go into effect April 15.