$1.5 BILLION: WALGREENS EXPANDS DIGITIZATION PARTNERSHIP WITH TATA CONSULTING SERVICESby John G. Baresky on 03/28/20
Walgreens and Tata: a 10-year $1.5 billion deal
2020 is a pivotal year of transformation for one of the world's largest healthcare companies, Walgreens Boots Alliance (NASDAQ: WBA). The company has announced it is widening the scope of its partnership with Tata Consultancy Services (TCS) and accelerating the innovation behind its global IT strategy. The $1.5 billion deal allocates a massive portion of Walgreens IT operations to TCS paid out over a 10-year time span.
Based in Mumbai, TCS (BSE: 532540, NSE: TCS) is a recognized leader in business solutions, consulting and information technology services. Founded in 1968, TCS employs over 420,000 associates.
How Walgreens and Tata Consultancy Services will work together
The Walgreens global IT organization will center on initiatives aligned with improving digital resources and services based on business platforms. TCS will provide dedicated managed services comprised of application infrastructure resources, IT operations, security and other advanced support.
TCS will be implementing an array of technology strategies, applications and tools. This includes artificial intelligence (AI), machine learning, software engineering and cloud computing. The goal of the program is to put the already highly sophisticated Walgreens IT infrastructure ahead of the curve in terms of innovation and performance. This will reduce costs while improving productivity and ROI.
2020 is a year of transformation for Walgreens
In 2019 Walgreens shared that it was considering options to take the organization private and announced it was pursuing major technology improvements and cost cutting measures to improve the company's balance sheet. Walgreens has several strategic alliances already underway with Kroger, McKesson, Microsoft and Prime Therapeutics.
While it remains to be seen what direction Walgreens will take in terms of its public versus private corporate status, the organization continues to forge ahead as it always as an industry leader and respected competitor.
So far in 2020, Walgreens has:
- Hired Dr. Kevin Ban, M.D. as Chief Medical Officer
- Promoted 28-year Walgreens' veteran Richard Ashford to President
- Launched delivery services in 15 major U.S. cities coast-to-coast
- Inked a $1.5 billion deal with a Tata, a global leader in IT and digital services
Walgreens continues to build its success
Founded in 1901 and based in the Chicago suburb of Deerfield, Walgreens is ranked at number 17 in the Fortune 500, it operates more than 14,000 stores and has over 400,000 employees. The company has paid shareholders a dividend for 85 straight years. Its new deal with Tata signifies just part of Walgreens ongoing commitment to earnings and competitive growth through transformation in the new decade.