IBM to Take Over Some Sprint Call Centers
KANSAS CITY, Mo. (AP) _ IBM Business Consulting Services will take over management of some of Sprint Corp.’s call centers across the country, Sprint announced Wednesday.
The five-year customer-service agreement calls for IBM to take over management of Sprint’s 21 vendor-operated call centers across the country and of the Sprint-owned call center in Nashville, Tenn.
Angie Makkyla, a spokeswoman for Sprint, said the thousands of workers at the 21 vendor-operated centers won’t be changing employers, but will be under new management. The 1,100 employees in Nashville, however, will now be employed by a subcontractor of IBM, and some Kansas City employees who support customer service will become IBM employees, she said.
In addition, the Dallas center serving long-distance customers will be consolidated into the existing Fort Worth, Texas, service center on April 30.
Sprint will continue to operate its seven remaining customer service centers.
Sprint estimated its customer service costs should be reduced by an estimated $550 million over the next three years. Bob Dellinger, Sprint’s executive vice president and chief financial officer, told investors at a meeting in New York that the deal would save the company $500 million per year when completed.
As part of the deal, IBM will sell Sprint services to IBM’s customers, Len Lauer, president and chief operating officer of Overland Park, Kan.-based Sprint said.
Lauer said Sprint hoped to improve customer satisfaction and wanted an experienced partner who could help redesign Sprint’s customer service centers.
IBM Business Consulting Services last year announced similar initiatives with companies such as Procter & Gamble, Raytheon, Annett, Lincoln Financial and UTC, and is also providing similar services to other communications carriers.
Gary Forsee, chairman and chief executive of Sprint, said the deal represents ``a major collaboration between Sprint and IBM, allowing Sprint to simultaneously move forward on our top priorities: improving customer satisfaction, driving new sources of revenue and operating our business more efficiently and with greater flexibility.″
Meanwhile, Dellinger also provided the company’s financial outlook. The company’s wireless business, Sprint PCS, expects an adjusted loss of between 13 and 18 cents per share in 2004, Dellinger said. In 2005, earnings are expected to turn positive and be within a range of 20 cents to 30 cents per share. Analysts surveyed by Thomson First Call expected a loss of 21 cents per share this year and a profit of 12 cents a share in 2005 from Sprint PCS.
The company’s wireline division, Sprint FON, expects adjusted earnings per share of between $1.37 and $1.42, Dellinger said. Higher pension and stock compensation expenses are expected to reduce earnings by about 7 cents per share. In 2005, earnings per share are expected to grow at a high single-digit to low double-digit rate, he said. Analysts expected Sprint FON would earn $1.37 a share for this year and $1.31 a share in 2005.
In early trading on the New York Stock Exchange, Sprint FON shares were down 26 cents at $17.69, while Sprint PCS shares were down 13 cents at $8.
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