Pearson Outsources Computer Operations

Pearson signed a seven-year agreement with IBM earlier this month through which the publishing company will outsource the computer operations of the Penguin Group and Pearson Education to the giant technology company. According to Pearson spokesperson Luke Swenson, Pearson's recent run of acquisitions has left it with a number of different computer systems. "At this point, with the Pearson portfolio settled, it makes sense to rationalize the different systems," Swenson said.

Under the agreement, IBM will help consolidate the operations of many of the two companies' older servers into a smaller number of high-capacity systems, and will deploy the IBM eServer p690 to support Pearson's SAP system. Thirty Penguin/Pearson Education locations in 11 states will be involved in the computer switch. Pearson executives believe the deal with IBM will not only improve the efficiency of their computer operations, but will also save money, although Swenson declined to reveal how much the potential cost savings would be.

As part of the outsourcing project, more than 70 employees who were part of Pearson's computer operations have become IBM employees; they will continue to support Pearson's data center operations in New York City and New Jersey.

Steve Canepa, v-p, global media and entertainment industry for IBM, said Pearson's decision reflects a trend among companies to outsource functions that are not part of their core capabilities. IBM has spent "millions and million of dollars building a large command and control" IT system that it can modify to meet the needs of Pearson, thereby allowing the company to focus on developing content, Canepa said. With book production becoming more entwined with technology and with the evolution of digital publishing, it makes financial sense to work with a partner who can deliver state-of-the-art technology, Canepa said.