Summary
Bethlehem Steel Corp.'s outsourcing of its information management function - Information Management
Bethlehem Steel Corp's decision to outsource its management information system (MIS) requirements was premised on the conclusion that the company had to concentrate on its core expertise in steelmaking to ensure that it could maintain its competitive edge. Thus, the decision to outsource was an acknowledgment that its MIS function had become inefficient and was unable to keep pace with new developments in a rapidly changing information technology (IT) environment. Bethlehem Steel approached the question of how best to select an IT vendor with methodical care. First, it identified a list of specific goals it wished to achieve with MIS outsourcing. Then, it rigorously evaluated outsourcer candidates with a view to selecting a vendor that could reliably provide cost savings without loss of control or IT skills. Bethlehem finally selected EDS as its vendor, after which a transition program was launched to smooth out the transfer of the bulk of its IT staff to EDS.See the full content of this document
Extract
Coke ovens over computers.
How do you pick the perfect outsourcer to take over your MIS and let you concentrate on your strengths? Step by step, Bethlehem Steel guides you through the painstaking evaluation process that led to its choice.
At Bethlehem Steel, it's painful to tear away money slated for rebuilding a coke oven to buy more computers. The steel industry is a very competitive, very capital-intensive business, and a couple of years ago we were beginning to realize that we needed to focus on what gives our company its competitive edge -- our expertise in steel-making. So, in late 1991, I met with Bethlehem Steel's senior vice president of operations (he's now our president and COO) to discuss a big concern of ours: the company's inability to leverage information technology (IT). We knew that many companies, especially manufacturers, find keeping up with technology very difficult, and we were among them. But we also knew that that's how a firm makes its technology investment cost effective. You simply can't install costly information systems that aren't contributing to your business. We decided that outsourcing our management information systems (MIS) function may be the answer for us....See the full content of this document
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