This is the BBC's own Press statement about the decision:

BBC announces preferred supplier for outsourced finance and accounting services
Date: 20.10.2006


The BBC announced today that it has selected Xansa as the preferred supplier for the BBC's outsourced finance and accounting services. The new contract will run for a period of ten years.

It is the result of the re-tendering of services that were successfully outsourced to Medas, a wholly-owned subsidiary of EDS, in 1997.

Subject to contract signature:

Xansa will work closely with the BBC to deliver finance and accounting services across the BBC, including purchasing and sales transaction processing, artist and contributor payments, financial management and project accounting, payroll processing and expenses and customer support.

The ten-year contract will cost the BBC approximately £8.5m per annum, and will generate savings for the BBC in the region of £20m per annum.

This will be a major contribution to the BBC's target of releasing £355m of savings to invest in programmes and services.

The BBC is currently conducting a simplification of its business processes as part of its Future Finance programme, which is delivering further savings of £17m.

Xansa will provide their services from a blend of locations in the UK and India. All voice contact (Customer Support) with Xansa will remain in the UK; other services, including transaction processing, will be carried out at Xansa's location in Chennai, India.

In this way the BBC is taking advantage of the significant savings of globalisation while maintaining the benefits of more local customer support.

The original outsourcing of these services to Medas in 1997 was seen at the time as being a ground-breaking deal which included a successful implementation of a common systems platform (SAP) across the BBC.

Medas also successfully transformed the BBC's transaction processing operation, delivering a fit-for-purpose and efficient service to the BBC.

Xansa was selected from a shortlist of four companies (Capita, EDS, Infosys BPO and Xansa) after a rigorous evaluation process against a number of criteria which included value for money, cultural alignment with the BBC, service delivery capability; the ability to drive improvements to the BBC's business and financial processes, and transition and exit planning.

Xansa will act as prime contractor working with Siemens Business Services.

We are confident that this will bring advantages to the BBC in terms of simplicity and lower cost for making changes to the BBC's IT infrastructure.

Zarin Patel, BBC Group Finance Director, said: "I congratulate Xansa on winning this major contract. The BBC will benefit from Xansa's proven expertise in managing outsourced Finance and Accounting Services, and we look forward to developing a close relationship with them.

"I believe this is an excellent deal for the BBC, and I am confident that Xansa will help us further to transform our finance and business processes.

"By moving our transaction processing to India we are demonstrating that we are prepared to take bold and imaginative decisions that offer the licence-fee payer great value for money, while still maintaining the highest quality of service delivery.

"I would like to thank our colleagues in Medas for their valuable support over the last nine years: in that time they have helped us transform the BBC's finance and accounting processes, delivered a sound SAP implementation, managed our transaction processing, expenses and business systems and left us with a fit and stable operation to build on in the future."

Alistair Cox, Chief Executive of Xansa, said: "We are delighted that Xansa has been selected as preferred partner to deliver Finance and Accounting Services across the BBC.

"Our expert technology and back office services allows our clients to do more with their own business and we are confident that we will, as the UK leader in F&A services, enable the BBC to minimise its administrative costs and to free up funds to invest in its own core business of creative programming.

"We are particularly pleased to be the BBC's first offshore BPO partner, and this week's award win as offshore operator of the year is another terrific endorsement of our leading offshore position and capability."

Notes:

BBC Finance

The BBC recently announced a significant number of changes to BBC Finance (BBC's finance division), as part of the corporation's drive to make significant cost reductions across its support divisions.

The Future Finance programme changes include:

The creation of a new specialist Finance Centre in Ty Oldfield (at the BBC's HQ in Cardiff), which came into existence in July 2006;

The introduction of new, simpler business procedures and a reduction in internal trading.

A reduction in the number of posts in BBC Finance from around 650 in 2005/6 to 310 in 2006/7, to 260 in 2007/8.

These measures will contribute to an anticipated saving within BBC Finance of £17m by 2008.

About Xansa

Xansa is the UK leader in the delivery of outsourced Finance and Accounting (F&A) services. With clients including BT, Lloyds TSB, MyTravel and the NHS, Xansa has many year experience of delivering F&A in both the private and public sector.

Xansa is an outsourcing and technology company with over 8,000 people in the UK and India.

Xansa has a 44-year history of delivering IT solutions to major clients across the private and public sector. Its portfolio of services includes: business and technology consulting, IT services, IT outsourcing, business process outsourcing, F&A outsourcing, and HR solutions.

Xansa is listed on the London Stock Exchange with revenues for 2006 of £357.3 million.

Medas and the BBC

Medas is a wholly owned subsidiary of EDS.

Medas was founded in 1997 to provide financial transactions processing for the BBC and also support the IT systems that facilitate that processing.

The company became fully operational in March 1998 following the transfer of nearly 400 finance staff from the BBC, in addition to the 80 IT staff who transferred in March 1997.

Medas operates from two sites: Ealing (West London) and Cardiff.

The services Medas provides to the BBC are in summary:

Accounts Payable

Accounts Receivable

Contributor Payments

Expenses and Advances

Financial Accounting

IT systems support and development

Payroll

Xansa have indicated that they will treat all existing Medas staff with fairness and sensitivity, and that normal TUPE regulations will apply.