Johannesburg - Chemical and energy company Sasol has outsourced part of its information technology (IT) functions internationally.
The petrochemical giant last week confirmed that at least 30 percent of back office support had been outsourced to Poland and India.
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Sasol said it had outsourced the services to enhance efficiencies and to standardise and integrate systems across its global operations.
Sasol employs about 31 000 people in 37 countries.
In July 2014, Sasol implemented a new operating model that the company said had improved operational performance and decision-making. The head of group media relations, Alex Anderson, declined to disclose the cost of the contracts.
“Unfortunately I cannot disclose the total value of the contracts as there are multiple service providers with contracts for different services and, therefore, contractual values,” Anderson said.
Sasol said multinational Indian-based IT services company, HCL Technologies, would provide infrastructure services, while communications services company BT, which is a British multinational telecoms services company, would focus on Sasol’s networking requirements.
Support services
It said the Irish professional services group Accenture, would provide support services applications.
“This approach has resulted in a reduction in complex systems and processes, and has delivered further efficiencies, which in turn have changed our IT capacity requirements,” Anderson said.
“We also have a number of services that are regionally focused and these are awarded to South African companies. These services include a service desk, workplace computing and a number of hosted applications. The partners in this respect include EOH and BCX.”
Cosatu said the move would have far-reaching implications for the economy. Spokesman Sizwe Pamla said the outsourcing of core businesses compromised jobs in South Africa. “It has a negative impact on jobs, because, as it is, stats show that there are 8.9 million people without jobs. This is economic sabotage and compromising workers’ interest and those of the community.”
Trade union Solidarity chemical sector co-ordinator, Gerhard Cloete, said the union had noted that Sasol retained a large in-house IT capacity and used outsourcing for back office needs. Cloete said Solidarity was not aware of any restructuring plans or possible job losses at the company. EOH and BCX declined to comment.
Nedgroup Securities analyst Mohamed Kharva said from a business perspective, Sasol took the right decision by outsourcing the services. “However, there are softer issues regarding job losses etc, that also need to be taken into consideration from a South African perspective.”
Imara Asset Management chief investment officer Bruce Williamson said Sasol had done the right thing by focusing on enhancing its systems. “It is best for them to focus on what they can control.”
* With additional reporting by Siseko Njobeni
BUSINESS REPORT