IBM Japan and Japan Airlines (JAL) will begin a 10-year information technology partnership valued at 80 billion yen ($US664 million) to IBM.
JAL will outsource a wide range of systems development, operations and other services to IBM Japan beginning in July to strengthen its use of information technology to meet its corporate strategies and manage costs.
IBM Japan will invest in and provide a number of its managers and engineers to JAL Information Technology Co., Ltd. (JIT), the IT subsidiary of JAL. This will merge IBM`s leadership and experience in outsourcing in both the Japanese and global markets with JIT`s know-how in the airline business and JAL operations.
In addition, IBM Japan will provide JIT with marketing and technology expertise to enable JIT to grow external sales and profit.
“In an era where IT is developing at a rapid rate, this partnership with IBM will allow us to develop new technology solutions that will drive customer satisfaction and help us meet our corporate strategy, while increasing the external competitiveness of JIT,” said Mr. Katsuo Haneda, Senior Managing Director of JAL.
Mr Teruo Shimizu, General Manager, IBM Global Services, Japan, said, “This outsourcing agreement is the largest of its scale for the Japanese airline industry. It combines the strength and knowledge of both JIT and IBM to provide long-term outsourcing services to JAL in a very co-operative manner. IBM is a leader in providing a broad range of products, services and integrated solutions to all segments of the travel and transportation industry, including such Asia Pacific leaders as Ansett Australia and Air New Zealand, Singapore Airlines, Cathay Pacific and Korean Airlines.”
Initially, JAL will take a 51% equity position in JIT, however after a transition period this will change to IBM Japan holding a majority equity position.
The July 1 start date follows the signing of a basic agreement in January. The contract will be carried out by IBM`s services arm, IBM Global Services.