MTC restructures across the group

MTC Group is set to embark on a massive IT restructuring which the mobile giant expects will lead to cost savings worth millions of dollars over the next 18 months, IT Weekly can reveal.

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By  Chris Whyatt Published  April 2, 2006

MTC Group is set to embark on a massive IT restructuring which the mobile giant expects will lead to cost savings worth millions of dollars over the next 18 months, IT Weekly can reveal. Now operating in 19 countries throughout the Middle East and Africa, the Kuwaiti mobile operator has set about aligning its six core IT infrastructures in Kuwait, Bahrain, Lebanon, Jordan, Iraq and Sudan, as it bids to make IT capital expenditure savings of around 20-25% over the next 18 months — a strategy it describes as ‘very critical’ to the future of the operators within its business. In an exclusive interview with IT Weekly, Mohammed Rafi, CIO of the MTC Group, said the savings would be made from group-wide procurement initiatives it is currently negotiating with its major IT partners and by changing the model under which it provides services to its individual operating companies. This would include centralised service delivery, hosted services, and data centre and server consolidation for existing and new value-added services to be launched by the Group, he said. “Each project is a multi-million dollar investment. If you look at the IT budgets, they are running into tens of millions of dollars for each operator and most of their focus is going to be in aligning the business with their IT systems,” said Rafi. “Because we are entering a global space in terms of operations, we want to make sure that every process in the organisation structure matches those requirements,” he continued. “Standardisation and restructuring adds value at the end of it and it’s essential. We are getting the operations ready for more refined competition,” he added. Rafi pointed out MTC is not actually cutting its spending on IT, but optimising the manner in which it uses and provides IT services. “There are clear savings that can be made here, with less platforms to support, less operating systems and less application systems,” Rafi explained. While it was difficult to put an exact figure on the cost savings MTC Group expected to make, Rafi said, he pointed out that current expenditure across the group is in excess of US$100 million. Restructuring and cost-cutting exercises are often associated with job cuts, but Rafi said that would not be the case for MTC Group. “No jobs will be lost, we are in a growth mode so there are many areas that we can actually utilise all of the resources that we currently have. We are always looking at the right calibre of people to support our operations,” he claimed. With between 50 to 75 IT staff working at each of MTC Group’s core operational units, the Group could “definitely sustain the same level and become more internal service-orientated rather than just looking at systems,” Rafi claimed. As part of the plans to upgrade each of its IT environments in Kuwait, Jordan, Lebanon, Iraq and Bahrain, along with a number of operation centres in Africa, the MTC Group – which has over 15 million customers — is looking to build upon the infrastructure, application architecture, technology architecture, and IT processes already in place. Sun Microsystems, Cisco, HP, Oracle and EMC are among the major IT vendors that MTC Group currently works with. Rafi said that each project will be undertaken step-by-step at different stages, and that theappropriate interfaces and integration requirements will not be tackled with a “big bang approach.” At present, the MTC Group is in the review stage and will have a clear guideline within two months of the specific savings it will be able to achieve.

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