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In practice: AXA

In recent years, the AXA insurance group has made major expansion leaps through acquisitions - and each time it has inherited a separate IT department. To bring those resources together, in 2002 the Paris-headquartered company formed AXA Technology Services, a semi-autonomous arm that provides IT services back to the company at 'benchmark' commercial rates.

For Ian Baxter, global head of transformation and change management at AXA Technology Services, that could not have even been contemplated if the service unit had not been able to leverage a broad - and quickly-formed - base of partnerships. It chose IBM for servers and France Telecom for networks. When it came to the management of employee desktops, it bet on Dell. And it is a very big bet.

AXA already has between 80,000 and 90,000 seats under management across the globe through Dell, with 14,000 of those in the UK. And it is looking to add many of the remaining 60,000 AXA users over the next couple of years.

"As a result of the acquisitions, what was under the covers was a traditional IT patchwork where each company had been acquired on the surface but not from an IT perspective. So they would have their own set of vendors, their own set of solutions and their own service level agreements."

With Dell as the primary desktop provider, AXA has signed up the company to "bring everyone in line". Among other managed services, that involves the creation and roll out of standard user software images and the establishment of standardised helpdesk services.

Dell's model for fulfilling such contracts is unique (see feature, 'Modus operandi'). Alongside its own account managers, service designs and program managers, it drafts in the excess capacity of key partners - in this case IT services giant Getronics and some local service providers. "From an end-user point of view, they are dealing with Dell as their first port of call," says Baxter. "We are extremely reliant on Getronics via Dell in most countries but where we have left some local incumbents in place, Dell has partnered with them," he says.

Reducing the expense of desktop management was the main driver - at least initially. "Even though the initiative was kicked off under a cost reduction umbrella, what we are seeing now is a shift to asking our partners for a bit more - especially as we [as an industry] move into a growth situation. We have got very good at cost convergence and getting the unit price right. Now we've got to get to a point where the service might need to be more flexible or where we want to change the deal dramatically, and that will be a whole new game for a lot of providers."

That global partnership is a very different situation from three years ago when AXA relied on mostly local providers, plus in-house managed service teams. "There was overlap in the service and no clear boundaries; the level of service provided to one part of AXA, even in the same county, on the same floor, was different to another," says Baxter.

"Part of the process has not just been to standardise, but to drive to a target model," he says. "And sometimes the target model is actually less of a service. Some of our customers were getting a gold service when they didn't need it. And part of our task has been to re-align that model."

The upshot is that costs have come down dramatically. Compared to previous overheads, service expenses have been cut down by between 20% and 30%, while the quality of services has improved overall, says Baxter. And that is not just by his own judgement - customers have to sign off on the metrics used to gauge performance.

Now the challenge is to bring the remaining 30% of users into the global service. When that task has been completed, AXA's 140,000-seat roll out will rank as one of the world's largest managed services.