Guy Kirkwood's BPO Backchat
28 may 2004
With EDS' much-publicised woes, CSC being surprisingly quiet and Perot Systems chewing through the latest NHS deals, the market was wide-open for IBM to win the Defra contract, its first UK government work. I would not be at all surprised to see another two or three deals being announced before 2005.
The one fly in the ointment for big blue is the recently announced appointment of Ian Watmore as the government's CIO. Could we now see Accenture getting in on the act?
Oh yes, there is also more for Business Week here.
27 may 2004
I seem to be a one-man advocate for offshoring at the moment. A Business Week posting prompted this response.
26 may 2004
Accenture, CSC and Siemens are the final three bidders for the BBC's technology group. 1400 people will TUPE to the successful supplier. But in a sop to political considerations, the BBC has said that while offshoring application development will be permitted, everything else - including services, help desks, and network support - must stay within the UK.
24 may 2004
Lloyds TSB is in talks with two suppliers for a 10-year ITO worth up to GBP1bn. Which ever firm wins, I foresee a large majority of the jobs going offshore, probably to India. If this is the case, IBM's recent acquisition of Daksh was probably extremely timely.
22 may 2004
Cnet has been following the offshoring debate with some aplomb. It has accumulated some interesting articles which are worth reading. The latest is on innovation as a means to combat the loss of jobs in any given sector. I agree wholeheartedly with its conclusions. (I also published my tuppence-worth).
21 may 2004
As I predicted last Saturday, United Utilities posted it's first GBP1bn year with an increase in profits of 6%. Vertex, the ITO and latterly BPO part of this business posted a 35% increase in profits and from what I hear in Manchester, this financial year could bring even better news.
20 may 2004
Wow, I take it all back. I had been extremely rude about Capgemini's name change in an environment where the firm seemed to be doing badly in outsourcing in comparison with its competitors. Well, today the firm announced that it has won a USD3.5bn deal with TXU. This is the largest ITO deal of the year so far, so credit where it is due. (Although I'm still not convinced that the EUR60m name change had anything to do with it).
19 may 2004
More encouraging news from our friends at Chart of the Day.
"Although it took 29 months, there are finally more jobs now than when the recession ended. While it took much longer than the 1954-1990 average during which job growth tended to be immediate, jobs are currently heading in the right direction and at a pace similar to that of previous job growth two plus years following a recession."
18 may 2004
As a reasonable primer, all-be-it US-centric, John Harney takes a look at consolidation in the HRO market. It's conclusions are all common sense, but it does have a good table of the recent M&A activity.
17 may 2004
More woe for EDS as UK-based bank Abbey, is thinking of terminating its BPO contract. Actually, it is really not EDS' fault this time, Abbey only demutualised in the past couple of years and is now looking to sell itself. If the deal with EDS is in operation, this process becomes all the more difficult. But, to lose a GBP270m deal especially after the upheaval in the government work, must be making the management at EDS feel pretty sick.
15 may 2004
United Utilities set the scene for this week's full-year figures when it released a trading statement in March saying it had performed in line with expectations. Smaller non-regulated operations are all expected to show good progress, including the group's Vertex outsourcing arm - which clinched a new five-year deal to handle calls, orders and billing on behalf of Marks & Spencer yesterday. I think the analysts' predictions of pre-tax profits of GBP345m compared with GBP327m will be comfortably beaten when it updates the market on Thursday. I also predict that Vertex will outgrow it's parent within 12 months.
14 may 2004
It seems obvious now, but even 12 months ago I doubt that many people would have expected it to happen so soon... What? BPO in Q1 outsold ITO. I have been banging on about how BPO was going to be bigger than ITO for nearly six years. The future is looking rosier by the week. :)
13 may 2004
Is offshoring here to stay? There have been numerous articles on this subject, but to cut through the crap, Antiphon's very own BPO Notes tells it like it really is.
12 may 2004
With the world's press concentrating on the abuse of prisoners in Iraq, the last thing one would think of is outsourcing, yet astoundingly, BAE Systems has just advertised for civilian contractors to carry out "interrogation duties" Oh. My. God.
11 may 2004
News of interest to all outsourcing advisory firms. As predicted last week, TPI has been sold to the private equity group affiliated with Monitor Group. I confidently predict an exodus of the best advisors in the next few months. A stand-alone company never stays stand-alone for long.
10 may 2004
Great article out tomorrow on offshoring by Andy McCue. Go. Read.
7 may 2004
Outsourcing advisory firm TPI, will have some news in the next few, hours, days or weeks... stay tuned
Organisational flexibility and adaptability are becoming more important to corporate success than operational performance and efficiency, according to results from a recent Global Future Forum survey.
That is why the fast, responsive and flexible BPO firms are all going to be bought by the slow, cautious, big ones... hang on, what happens then?
5 may 2004
Labour arbitrage in offshore outsourcing just got a massive fillip. Wipro (in conjunction with IBM) has just signed a USD1bn deal with Shell to offshore at least one-third of the 9000 IT personnel in the business. In February, I predicted that this would be the year of offshoring... this is barely the start.
4 may 2004
One of the most respected and incidentally, also one of the nicest people working at senior levels in the outsourcing market is John Tilley, the ex managing director of Sema. John is now working with Perot Systems on the UK-based NHS deals. It is therefore "hats off" time to John as I think he has been instrumental in turning around the fortunes of Perot in Europe.
3 may 2004
In more good news for the HRO market, for the second fiscal quarter, Hewitt's revenues increased 14% to USD546m from USD478m in the comparable prior-year quarter. Outsourcing revenues increased 19%, and Consulting revenues increased 7%.
Let's hope that this is a sign of double-digit growth for the market throughout the next three quarters.
2 may 2004
Last month's blogs have not suddenly gone out of date, if you missed any, they are worth reading. Also check the archive.
1 may 2004
Why hard code the html when a service as good as blogger is out there? The answer is... don't.
Guy Kirkwood's BPO Backchat has been running since July 2003, but is picked up by only a few crawlers for inclusion in news sites. By using blogger, I hope that the number should increase. In all other ways, the blog will remain the same opinionated, rude and honest appraisal and analysis of the BPO markets globally. Details over the next week or so.