Industry news

Serco warned they would have to write down the value of several lossmaking contracts which would hinder annual results. Share prices dropped one percent as a result of Serco’s warnings. The news comes after several high profile exits from its management team in recent months, Rupert Soames took over as Chief Executive officer in May. It’s been a hard year for Serco after it was temporarily banned form biding from all central government work.

It’s been a mixed month for Serco

According to research based on audited accounts from primary Care Trusts, since 2011 there has been a significant increase in the private provision of NHS-funded community and mental healthcare. The Nuffield Trust reported that in 2012-2013, commissioners outsourced £1 in every £5 to private providers which represented an annual increase of 34%. The research went on to show that from 2011/12 to 2012/13, funding for independent mental healthcare services increased by 15%, however funding for NHS-provided mental healthcare fell by 1% in this period.

NHS told to learn from the high street and to privatise

The NHS is looking to outsource cancer care to private health firms, this would be the largest health service outsourcing plan worth over £1.2bn. A number of private healthcare providers have already expressed interest in a £689m contract in the Staffordshire area which would last 10 years, there is also a spate £535m contract to provide end of life care. There is concern however that outsourcing cancer care will result in job losses within the NHS trusts.

NHS told to learn from the high street and to privatise

Atos have signed a 5 year outsourcing contract with RTE a French utility company, responsible for maintaining the French electricity grid. The contract will develop IT infrastructure and applications and workplace services. RTE’s CIO emphasised the importance of IT systems as the nerve centre of their operations. RTE hope to draw on Atos’s experience of innovation to maintain and further improve IT quality to its public service function.

Atos urges government to improve disability claims system

According to Everest’s Annual Contact Centre Outsourcing Report spend has grown 7% in 2013 to reach €70-75 billion signalling steady growth since 2009. The report reveals a higher number of new deals alongside a higher number of contract terminations as buyers consolidate their portfolios and focus on driving more value from their current engagements. Everest’s Report highlights that the call centre outsourcing value proposition has changed over time to move beyond labour arbitrage and the focus is now clearly on multi-channel and industry specific solutions and value-added services to drive process improvement and business outcomes.

Procurement Outsourcing shows 12 percent growth

IBM has been awarded a 10 year contract with Spanish bank, Banco Popular, to manage their tech infrastructure, including their private cloud. 41 employees will be transferred over to IBM with the aim of this deal is to save Banco Popular $200 million over 10 years. IBM have previously worked with Banco Popular to help modernise their data centre and their new tech headquarters in Madrid.

Australian Department of Health take 13 year IBM outsourcing agreement to tender

The Home Office plans to reshape its strategy to procuring and building IT Systems by lowering barriers allowing smaller providers to bid. The new strategy aims to cut costs by moving away from larger end to end contracts. The Home office have said that the new strategy will reduce reliance on a single supplier and allow for a more flexible approach to systems improvement.

Home Office tenders for emergency services network

A pre-tender has been issued by the Department for Work and Pensions (DWP) for its IT transformation, to determine the best approach with its current contracts. The IT Transformation Programme (ITTP) is to help DWP deliver change in its major contracts keeping in mind their overall strategy. An ‘industry day’ is due to take place in July to update potential suppliers on the tender and to allow unsuitable providers to opt out.

DWP chooses service tower model for IT

Brisbane Airport needed to expand after its Data centre reached capacity in 2013. Brisbane Airport considered building its own secondary data centre but found it was more cost-effective to outsource. After deciding to outsource its data centre to iseek the Eagle Farm data centre was set up and running within three months. The deal saved Brisbane Airport millions of dollars in upfront capital costs.

Salesforce data centre opens in the UK

According to Gartner analyst Claudio Da Rold in a recent article, the outsourcing market is transforming and like many others its changing due to digital influences.

“Digital business” is allowing companies to take advantage of new opportunities and where the differences between physical and digital are becoming increasingly blurred. Gartner estimates that by 2020, there will be at least 26 billion connected “things” (excluding PCs, tablets and smartphones) and as these increase so will the information flow and new disruptive ways to do business.

Claudio goes on to say that “Outsourcing is in the process of being reborn, as adaptive sourcing. This demands that organisations have an outsourcing strategy with distinct layers that operate at the pace of the business outcomes they facilitate. This strategy must be as flexible as is needed. It must involve more integration of third-party applications and services with internal systems, as well as greater collaboration with stakeholders inside and outside the organisation.”

Economic uncertainty drives IT transformation