Marks & Spencer has kicked off a technology transformation initiative, which will consolidate its supplier base and outsource more than half its IT team.

The department store retailer’s technology initiative will cost £25m to implement and is set to deliver £30m in annual cost savings by 2021.

The overhaul will see the employment of 250 of the retailer’s 430-strong IT team transferred to Indian technology firm Tata Consultancy Services (TCS).

The affected staff will continue to work out of Marks & Spencer’s west London office, but will be employed directly by TCS, which has been drafted in to oversee the digital transformation project.

As a result of this, all of Marks & Spencer’s existing technology suppliers will be transferred to TCS for project management and day-to-day communications.

The retailer said it will consult with 30 of its existing IT staff “whose functions will be carried out differently in the future”.

Marks & Spencer’s remaining in-house technology team, which comprises around 170 staff, will be focused on driving innovation to support the commercial side of the business.

The digital overhaul will include the creation of a new operating model, which will come into effect from March and drive Marks & Spencer’s adoption of new technology and agile working methods.

Chief executive Steve Rowe said: “We are committed to transforming M&S for our colleagues, customers and shareholders by delivering digital-first retailing across our stores and offices.

“Technology plays a huge role in this transformation – and having the right partners and model will enable us to be more agile, flexible and responsive.

“Through our technology transformation programme, our business will be faster, simpler and more focused on achieving a seamless customer experience.”