Hitachi Consulting, BlueStar Solutions Ally on Mid-market

Partners to deliver IT, ERP outsourced solutions to mid-tier companies in North America

Partners to deliver IT, ERP outsourced solutions to mid-tier companies in North America

Dallas — April 20, 2004 — Hitachi Consulting Corp., the business and information technology (IT) consulting arm of Hitachi, Ltd., and BlueStar Solutions, a provider of hosting and applications management services for mid-market companies, are allying to deliver IT and enterprise resource planning (ERP) outsourced solutions to the mid-market.

Under a channel agreement between the two companies, Hitachi Consulting will expand its current outsourcing solutions offerings by marketing and promoting integrated, outsourced IT and enterprise resource planning (ERP) solutions with BlueStar Solutions as a service delivery alliance, focusing on mid-market companies with a presence in North America.

The partners said that the alliance brings together BlueStar Solutions' expertise in hosting and managing ERP solutions and Hitachi Consulting's business process consultation and solution implementation capabilities.

Technology consultancy Gartner has predicted that IT management services revenue for the midsize business market will exceed $15 billion by 2006, but Hitachi and BlueStar assert that mid-market companies are often overlooked by large providers of IT outsourcing services due to the size of the mid-tier enterprises' annual IT spending.

Hitachi Consulting points out that it has a track record of offering solutions to mid-tier companies, citing clients such as AlignMark, Aviall, Avocent, Mary Kay and Viking Range. By teaming with BlueStar, the consulting firm said it will be well positioned to deliver the return on investment (ROI) required for successful outsourced IT solutions to the mid-market.

"Our agreement with BlueStar Solutions, while a strategic move for our growing outsourcing business, is a very pragmatic one," said Larry DeBoever, executive vice president and general manager of Hitachi Consulting's Outsourcing Division. "We have many times found ourselves in the same accounts, not competing with each other, but as providing two complementary halves of the whole solution. It is only natural to put those 'halves' together into a single offering, under a single contract. One contract would mean one source of accountability for achieving desired service levels, thus reducing risk."

DeBoever said that Hitachi Consulting already has won three contracts working in tandem with BlueStar.

Last year, Hitachi Consulting announced its entry into the outsourcing business, with offers primarily in the business process outsourcing (BPO) space. The consultancy believes that the alliance with BlueStar Solutions complements Hitachi's current portfolio with hosting and application management offerings. Leveraging this alliance, Hitachi Consulting said it will now also pursue full IT outsourcing contracts, centered on an ERP solution.

Additionally, BlueStar's outsourcing offerings will now be strengthened by their ability to jointly offer maintenance and enhancement services (MES) around the solutions they manage for their clients, as well as assist their clients with major upgrades and migrations, in conjunction with Hitachi Consulting.

"The two companies' portfolios are extremely complementary, as are our common skills around SAP, PeopleSoft, Oracle and Lawson applications," said Thomas Kelly, chairman and CEO of BlueStar. "We anticipate the reach of Hitachi Consulting's sales organization and the strength of its brand helping both companies increase market share, accelerate growth and build new relationships with companies looking to take advantage of the many benefits our combined strengths offer."

"Our alliance with BlueStar Solutions enables us to offer clients a complete IT and ERP outsourcing solution: from design and implementation, through ongoing applications management, including maintenance and enhancement services, all under one contract," added DeBoever. "We think this type of one-stop shopping for the mid-market is unique and provides the type of value, relationship and assurance our clients want from a solutions provider. And, our alliance agreement allows either Hitachi Consulting or BlueStar to be that single point of contact, whichever the client feels more appropriate."

For a more in depth look at the mid-market supply and demand chain, as well the strategies that mid-tier companies are using to overcome their supply chain challenges, watch for the cover story "Stuck in the Middle" in the April/May 2004 issue of Supply & Demand Chain Executive magazine.

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