Signs agreement with ICG Commerce for business process outsourcing for supplier enablement, transaction processing and content management services
Philadelphia — March 1, 2004 — ICG Commerce, a procurement services provider, today announced it has come to an agreement to provide procurement business process outsourcing (BPO) services to Avaya Inc., a global provider of communications networks and services for businesses.
ICG Commerce said it would provide Avaya with supplier enablement, transaction processing and content management services to address the company's full range of indirect purchasing commodities.
In addition, ICG Commerce will provide strategic sourcing, category management and contract management for a majority of indirect buying categories.
"Our selection of ICG Commerce factors into our overall procurement strategy to leverage the resources of a procurement services provider to realize gains in cost savings and improve the delivery of procurement services to Avaya," said Onye Uzoukwu, vice president, Avaya Global Procurement. "Outsourcing select non-core commodities and processes gives us the ability to concentrate on more strategic objectives while still effectively managing Avaya's indirect commodity spending."
As companies seek to focus more on their core competencies as vehicles for top-line growth, outsourcing becomes an attractive means to retain that concentration. According to Aberdeen Group, outsourcing non-core procurement activities or commodities allows companies to avoid the burdens of building and maintaining an advanced procurement infrastructure for categories of spend that are either non-strategic or do not warrant additional resources, while improving savings levels, visibility and control. Such strategic benefits have led nearly 20 percent of large enterprises to outsource at least a portion of their procurement activities already, with that figure expected to more than double over the next three years.
ICG Commerce said it currently provides a variety of outsourcing services to meet company specific objectives. Select examples include: provision of an onsite procurement team and fully hosted suite of purchasing tools for a major IT network services firm; management of transactional buying for a Fortune 100 conglomerate; and management of sourcing, purchasing and supplier performance for a major industrial manufacturer.
"Avaya is among the leaders that have already recognized the value a procurement outsourcing relationship can bring to a company," said Edward West, chairman and CEO of ICG Commerce. "We look forward to delivering this value in a measurable way and to a long and successful partnership."