Cirque du Soleil has signed a 10-year IT outsourcing contract with CGI, valued at $130 million. Montreal’s world-renowned entertainment company, which combines circus and theatre, wanted to offload some of its less strategic IT functions as its operations expand around the globe.
“We have very rapid growth and we wanted to leverage the infrastructure provided by CGI,” said Danielle Savoie, CIO of Cirque du Soleil.
As part of the contract signed last week, CGI is in charge of providing IT operations, help desk and application evolution of Cirque’s global infrastructure, including its Montreal headquarters, four permanent shows in Las Vegas and one permanent show in Orlando.
This involves transferring 84 IT positions to CGI from Cirque du Soleil in Montreal, Las Vegas and Orlando. A certain number of technicians have stayed on with Cirque to perform more strategic IT roles.
CGI is also in charge of the IT infrastructure behind Cirque’s travelling shows. On tours, only one technician is required to set up the IT infrastructure, such as point-of-sale and ticketing applications (since Cirque runs a centralized IT infrastructure out of Montreal).
Cirque will keep IT strategy and direction in-house, as well as global planning and architecture design. “We didn’t want to lose this strategic knowledge,” said Savoie. “When we want to re-engineer some part of our business processes, it’s important to have this knowledge.”
CGI will manage its PCs, servers and the help desk, said Normand Paradis, vice-president of business engineering with CGI Group Inc. in Montreal. “We will also take over support and evolution of the portfolio of applications.” This includes a wide range of applications, from administrative functions like payroll to tour equipment, costumes and merchandise.
Over the course of the lifecycle of these applications, modifications are made to respond to new business requirements, said Savoie. “Every year we have to make some evolution in this portfolio,” she said, adding CGI is now responsible for these modifications.
“They have over 100 applications of various sorts we will be maintaining for them from strictly administrative to (costumes),” said Paradis.
“They design and build these costumes (and) we provide the IT support behind that,” he said. “But it’s just one of the things they do – for them it’s really all about intellectual property.” This includes costumes, music, even the acts themselves – all of which are part of the intellectual property they’re managing. And they have to use a lot of systems to do that, he said, in order to protect it properly. In its aquatic show “O” in Las Vegas, for example, costumes deteriorate quickly in water, so CGI will keep track of items like costumes, diving equipment and maintenance.
“On top of that they run a large financial system and large payroll system,” he said. “For a circus, doing the payroll is not exactly their core activity, but it better get done because if the guys don’t get paid you’re not going to see too many shows.”
This is the beginning of CGI’s foray into the entertainment and sporting event sectors, which it began last year with the World Aquatic Championships in Montreal. CGI expects its partnership with Cirque du Soleil to strengthen its expertise within these areas. “For us it’s working with a major player,” said Paradis. “They have a very strategic brand [and] they are well known on a global basis.”
The transition process to outsource these IT functions started last week and will take place over the coming 12 months.