The “Application on demand” concept taken further by IBM and Solvay

IBM and Solvay , two key actors in their respective […]

November 18, 2008

IBM and Solvay , two key actors in their respective sectors, have just renewed their SAP infrastructure outsourcing contract. The new approach will enable Solvay to control its costs thanks to a model based on real consumption of IT resources.

Contrary to the traditional “supplier/client” collaboration and invoicing model, IBM and Solvay are extending the current model based on the one hand on the number of users connected to the system for standard ERP (Seat based model) and on the other hand on the resources employed (resources based model) to “New Dimension” SAP products. Put another way, Solvay benefits from a transparent view on the cost of its services and resources – software and hosting – and only pays for the resources that are actually used.

The use of the latest IBM technologies in terms of virtualisation (P6, SVC, DS8000 processors etc…) plays a key role in the design of the new solution: in addition to the high ecological impact (for the same handling power, the energy consumption is reduced by 25%), these solutions enable handling power to be adapted to user demand. Furthermore, based on the projected effectiveness of its innovations, IBM commits to reducing expenses on an annual basis throughout the whole duration of the contract.

This aspect is a large advantage for companies like Solvay whose staff numbers increase with the development of activities, but also for small and medium-sized companies that may have access to resources adapted to their growth.

According to Koen De Laet, Client Solution Executive IBM Global Services, “The maturity and the experience of a company like Solvay have enabled us to develop this model. Solvay executives and our experts have been able to determine five key characteristics of their SAP requirements. These have led to a new collaboration and therefore new billing models. Thanks to this model, Solvay knows in advance how much its SAP related applications are going to cost. This means for example that if a client wishes to install a new SAP application (Portal , XI , BI , Solution Manager , SCM , CRM , etc.), they know in advance what the financial impact of their decisions is going to be. This is particularly interesting for companies since SAP puts out new functionalities on the market each year.”

As confirmed by Stefan Vanhelleputte, Solvay Chief information Officer, this type of tailor-made collaboration enables companies to accomplish specific challenges that are specific to the company: “The solution that we have developed with IBM will enable us to harmonise all practices, to have a very clear view on our costs and our consumption, both in terms of our IT resources and energy consumption. The new “Application On Demand” contract is a step further in the direction of Software As A Service towards which both Solvay and IBM wish to move towards in future years.”

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