12 November 2004 French electrical infrastructure group Schneider Electric has signed a £1 billion (Euro 1.6 bn) ten-year outsourcing deal with IT services group Capgemini, which includes implementing a new global SAP system.

The deal will involve around 800 staff transferring to Capgemini, and unusually will require the IT services firm to take responsibility for the entire project – including the upgrade and worldwide support of Schneider’s IT infrastructure, a SAP business application development and business transformation.

Capgemini’s large outsourcing deals with the UK’s Inland Revenue, and US utility company TXU have required Capgemini to partner with subcontractors and third parties.

Analyst group Gartner issued a report warning that other Capgemini customers keep a close eye on the deal: “make sure your Capgemini resources remain focused and your service levels are maintained,” it said.

Ovum analyst Francois Dauriat was more optimistic about Capgemini’s ability in application deployment. “Capgemini’s strengths in SAP integration are well known. The company ranks among the leading players in this field, along with the two other contract bidders Accenture and IBM” he said.