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HCL scores record outsourcing deal in KSA

Outsourcing outfit HCL has secured a seven year contract with Saudi Arabia's Al Majdouie Group for outsourcing services, claiming it to be the largest Oracle e-business implementation in the region.

HCL scores record outsourcing deal in KSA
The Al Majdouie Group is the official KSA distributor for Hyundai motor cars, bringing in vehicles like the Genesis Coupe (pictured).
HCL scores record outsourcing deal in KSA
The Al Majdouie Group is the official KSA distributor for Hyundai motor cars, bringing in vehicles like the Genesis Coupe (pictured).

Indian services provider HCL has signed a seven year agreement with Saudi Arabia's Al Majdouie Group (AMG) for IT outsourcing. The vendor claims that it's the one of the largest deals it has struck in the Kingdom with an estimated value of more than $10 million. The agreement also marks the first time that that AMG has worked with an outsourcing provider.

Under the terms of the deal, HCL will assist AMG with what it terms a "transformational engagement", in which it will help create new infrastructure including a new datacentre and disaster recovery centre. AMG will also implement more than 70 modules of Oracle e-business suite, a initiative which HCL is already the terming "single largest implementation of Oracle in terms of breadth of implementation across the region." In addition, HCL will also be managing AMG's service desks, which entails supporting more than 1500 users in 100 different locations.

According to HCL's Virender Aggarwal, executive vice president and head for APAC and MEA, the agreement will see up to 50 people engaged and on the ground during peak load moments. Although good resources are still thin on ground, he believes the Saudi market's "challenging" reputation is largely undeserved.

"It is a challenging market to some extent, more to the extent of finding quality manpower. But it's also rewarding - it's a huge market and anybody who can't succeed in Saudi doesn't really have a big market . We are very committed to Saudi - we are not saying it's a tough market but seeing it as the land of opportunity," he says.

"After opening our office in Dubai a few quarters back, I think we are well poised to grow. The strength of manpower is already about 450 in the region. We have about 10 projects in Saudi so 50 people are surveying it at the moment. We have offices in Jeddah, Dhammam and Riyadh. We are well represented in Saudi, it's a very important country for us," continues Aggarwal.

Responding to a common criticism of outsourcing partners, he also confirmed that Saudi staff will figure prominently in the composition of the team.

"We don't have any intention of taking any serious work offshore. We will employ a number of Saudi employees as well, it's not that everyone will come from India. Helpdesk and service staff will definitely be local staff. I won't be able to comment on the numbers right now but we definitely have intentions because it's in our interest to hire people who understand the language," he verifies.

Though Aggarwal would not be drawn into a discussion on the value of the agreement, he did confirm that the value of the deal would comfortably exceed the figures of $10 million that had been bandied about earlier.

"We can't disclose the number but I would say that it is in the high teens in terms of millions of US dollars," he states. "I think it's a landmark deal because we're doing many things which we haven't done before. For example, we are implementing the dealer management system for the automotive group - they are the distributors for Hyundai and one of the largest out there. We are doing a data management system on Siebel which I think is something that's not been done by us before or maybe by anybody else.

"There are about 79 modules of Oracle which are there. Many of these are being used for the first time. In that sense, it is a starting point for us. It gives us a degree of excitement that we are attempting something new and it's a landmark deal of its kind in the region," continues HCL's Aggarwal.

HCL inauguarated its regional headquarters in Dubai Internet City in February. In Saudi Arabia, it maintains offices in Jeddah, Dammam and Riyadh for the 10 projects it currently oversees. Apart from the agreement with AMG, HCL has also secured two further Oracle implementations in the past six weeks specialising in Siebel, although it would not reveal the names of the clients.

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