India's Infosys to provide IT services to Sweden's Ikea in $100 million deal, says Report

Indian technology major Infosys has reportedly won a significant contract valued at over $100 million (approximately Rs 850 crore) from the Swedish furniture giant Ikea. 

The strategic deal surpasses bids from major competitors, including HCL, Capgemini, and DXC, along with other regional players.

According to a Times of India report, The five-year contract entails Infosys providing enterprise service management based on ServiceNow, IT services management, and a service desk. These services will cater to Ikea's 170,000 employees and 260,000 devices, with support available in 19 languages.

Employees transition to Infosys

The agreement will impact around 350 roles at Ikea across multiple countries, including China, France, Germany, India, Poland, Sweden, and the United States. These employees will transition to Infosys as part of the deal. 

Karmesh Vaswani, Executive Vice President and global head of consumer, retail, and logistics at Infosys, played a crucial role in securing the deal. An internal email from Infosys highlighted the lengthy but rewarding process leading to the partnership: "It has been a three-year-long but fulfilling journey that started with cold calling and some initial connections and culminated in a strategic partnership."

Parag Parekh, Chief Digital Officer at Ingka Group (the largest franchisee of Ikea stores), stated, "After careful consideration and evaluation of our current operations, Ingka Group has identified opportunities to improve the delivery of digital tools and services to co-workers with speed, scale, and flexibility. By partnering with Infosys, we will enhance our core business functions and further streamline operations."

How will Infosys execute the deal?

The deal is set to be executed over a five-year period, with the option to extend the contract for an additional year up to three times.

The extensive timeline demonstrates the long-term nature of the partnership and the commitment of both companies to achieving their shared goals. The partnership approach includes a roadmap featuring 36 transformation projects aimed at delivering significant improvements and efficiencies.

The deal aligns with its expansion strategy

This deal is part of Infosys' broader strategy to expand its presence in the Nordic region. Last year, Infosys secured a $454 million contract with Danske Bank, which included acquiring Danske Bank's IT centre in India. 

Infosys' expansion into the Nordic region is a strategic move to tap into markets known for their advanced technology ecosystems and high rates of digital adoption. By leveraging the skilled workforce in these regions, Infosys aims to enhance its service offerings and strengthen its global presence.