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Posted by
admin on Thursday, June 23 @ 22:05:38 EDT
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Pfizer To Outsource Some Computer Services
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admin on Thursday, June 23 @ 22:05:38 EDT
: " Pfizer To Outsource Some Computer Services
Two companies in India part of cost-saving plan
By ANTHONY CRONIN
Day Staff Writer, Business
Published on 6/23/2005
Pfizer Inc. will partner with two India-based companies to provide information technology services to its global research and development teams as part of the pharmaceutical giant's $4 billion global cost-savings effort. (Read More)
In an internal memo circulated this week titled “Evaluating Options: Moving IT Services to Low Cost Locations,†Pfizer officials said the move to outsource some of the computer and technology-related services would be done at a “carefully planned pace.â€
“Given the enormous challenge to our business, and in an effort to make Pfizer more effective and efficient, (Pfizer's R&D information management team) has been evaluating sourcing opportunities in low-cost locations,†the Pfizer memo said. Pfizer said it has selected IT specialists Infosys Technologies Ltd. and Satyam Computer Services Ltd. as its strategic partners.
Pfizer officials declined to comment on the memo, saying it was an internal correspondence with its worldwide global research and development associates. Pfizer's worldwide research and development operations are based in New London, and the company employs about 6,000 people at its research, development and manufacturing operations in New London and Groton. The company's corporate headquarters is in New York City.
Infosys provides consulting and information technology services to a global base of clients, and employs more than 36,000 worldwide. Satyam also provides business consulting and information technology services, and has nearly 20,000 worldwide employees. It serves more than 144 Fortune 500 companies.
In April, Pfizer announced that it would slash $4 billion from its overall operating costs by 2008, which represents about a 12 percent reduction in global expenses based on its 2005 figures. It also has said it would examine all of its worldwide operations for ways to save money and better streamline those operations. Industry analysts have speculated the cost-saving moves could involve global job reductions as well as possible plant closings. Pfizer is hoping that its corporate restructuring will help restore some luster to its sagging stock price. Company insiders expect Pfizer to announce more specifics about such cost-savings moves in late July.
Many large corporations routinely outsource their technology operations to other companies, including a growing number of IT specialists in India, China and elsewhere. IT-related costs are often a large expense for big corporations. Given today's technological advances that allow communications to speed globally in a matter of seconds, many U.S.-based firms find that shifting their technology-related operations to outside companies in the U.S. and elsewhere can save money and boost efficiency.
Some critics complain that the growing interest in corporate outsourcing is resulting in job losses for technology-savvy U.S. workers, while adding jobs to such workers outside the United States.
Pfizer's internal memo, sent on Monday via e-mail to its research and development associates, said the desire to find low-cost locations for possible information technology outsourcing is one of many options under consideration.
“It is crucial to keep in mind that our objective is to position (Pfizer and its R&D efforts) for success in the low-cost sourcing arena,†the internal memo says. “Therefore, we have decided to proceed at a carefully planned pace.â€
“As we continue to develop the low-cost location sourcing model, we plan to follow the ‘crawl, walk, run' philosophy,†the memo said. “We are very much in the ‘crawl' phase right now ...â€
Pfizer officials said in the memo that representatives of both Infosys and Satyam likely would be coming to company locations, “talking with various people, gathering information, and learning more about our work.†Pfizer officials also stressed that they will keep their employees informed as they move forward with their cost-savings moves.
© The Day Publishing Co., 2005
For home delivery, please call 1-800-542-3354 Ext. 4700 "
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