Industry news

Exl Service Holdings, Inc. has announced it has closed its previously announced acquisition of Outsource Partners International, a leading global provider of finance & accounting outsourcing services with approximately 3,700 employees in the United States, Asia and Europe serving roughly 80 clients.

Under the terms of the transaction, the enterprise value placed on OPI was $91 million, before working capital adjustments.

Public sector agencies are not convinced that a move to shared services would save sufficient money, according to a new Ovum survey.

The research, which was carried out by independent technology analyst Ovum, found that 49 per cent of chief information officers in public sector bodies are not convinced shared services would save enough cash to make it beneficial.

Commenting on the figures, Jessica Hawkins, Ovum analyst and author of a new report, noted that moving to shared services does result in upheaval and changes software applications – which could impact on those in developer jobs.

"These barriers that public sector agencies feel they face mean uptake of shared services has so far been modest in some regions," she went on to say.

Earlier this month, another study released by Ovum found that offshoring is seen as riskier than moving to the cloud when it comes to finance and accounting efforts.

The Capita Group Plc has acquired specialist healthcare recruitment firm Team24 Limited for a consideration, on a cash free debt free basis, of £24 million, plus up to a further £2 million depending on Team24's profit performance in the year to 31 March 2012.

Team24 provides nurses and doctors at short notice for a wide range of temporary placements across the NHS and the private sector.

Headquartered in Surrey, Team24 employs 80 staff and has around 4,000 doctors and nurses registered for placement. Clients include the NHS, prisons, doctors' surgeries and private practices. It also operates under a number of framework agreements, including the London Regional Nursing Framework. Team24 made a pro forma operating profit for its financial year to 31 March 2011 of £4.2 million on turnover of £32.7 million.

Commenting on the deal, Paul Pindar, Chief Executive of The Capita Group Plc said: "Healthcare resourcing is a growth market with demand for doctors and nurses increasing in-line with the ageing population and Government's focus on primary care, increased opening hours for GP surgeries and new services through NHS Direct. This acquisition will allow Capita to provide services to this growing market and complements a number of other services we offer to the public and private healthcare sectors. "

Cabinet minister Francis Maude has said that the government will crack down on large contractors who do not pay their smaller suppliers on time.

The government has a number of large contractors, including IT firms Atos Origin, Oracle, Logica and Fujitsu.

Maude’s comments come as Bacs, the organisation behind Direct Debit and Bacs Direct Credit, published research that found that large companies were the worst offenders when it came to late payments to SME suppliers. In contrast, the public and third sectors are meeting more of their bills on time.

“We are delighted that this report shows that government is serious about keeping its commitment to paying suppliers (including SMEs) on time. We expect and require our suppliers to pay within 30 days. We will crack down on any behaviour to the contrary,” said Maude.

South Bucks council has awarded a contract worth £11m for back office services including ICT to Steria and Northgate.

According to a notice published in the Official Journal of the European Union on 31 May, the suppliers will deliver a wide range of services including accounting services, software implementation and maintenance as well as hardware and consultancy.

The district council's new outsourcing deal will only retain functions in-house where contracting out is not permitted, such as fraud prevention and detection.

Revenue and benefits also form part of the seven year deal, covering the billing, collection and recovery of council tax and benefits.

The Capita Group Plc has acquired Call Centre Technology Limited, for a consideration of £15 million on a cash free, debt free basis.

CCT providesvoice telephony, applications and services for customer contact centres. Clients include 118 The Number, Strathclyde Police and Travelport. CCT made an operating profit for its financial year to 30 June 2010 of £1.7 million on a turnover of £18.7 million.

The acquisition adds valuable expertise and capabilities to Capita's existing telephony services. CCT already supplies services to a number of our contracts and businesses that have recently been acquired by Capita, including First Assist and Capita Secure Information Systems. Commenting on the acquisition, Paul Pindar, Chief Executive of The Capita Group Plc, said: "Our core outsourcing contracts are increasingly encompassing the customer contact interface and therefore, we are keen to enhance our capabilities and resource in this area.

This acquisition will be integrated with our current expertise in this area and will enable us to provide enhanced services to existing and new clients, as well as generating savings across the Group. Headquartered in Bristol, CCT employs 130 staff.

Mobile Operator Vodafone has decided to move two call centre operations from Ireland to Egypt and India respectively, and to outsource its debt collections to a third party in Ireland.

These moves will affect 45 staff at Vodafone and 139 employees of Rigney Dolphin, an outsourcing group that runs call centre activities on behalf of the mobile phone company.

These initiatives have been taken against a backdrop of falling revenues and declining customer numbers as the recession affects consumer spending.

Polaris Software, a leading global Financial Technology Company, has announced that Reserve Bank of India (RBI) has chosen Polaris to implement its IntellectTM Core Banking System (CBS) across the Bank. The end-to-end implementation includes System Integration and maintenance of software and hardware for a period of ten years. The deal is valued at USD 55 million.

RBI, the country's Central Banking Institution, wanted to implement a centralized Core banking Solution at all its offices encompassing all banking and accounting operations to align with its current and future IT requirements, including one Generalized Ledger for the bank. There were several functional and business requirements of RBI that are specific to large central banks and substantially different from the Core Banking System in a commercial Bank. Further, security was a major focus area in the CBS implementation, as RBI CBS will be a systemically critical solution in the country's financial scene. RBI is one of the most complex Central Banks globally managing public debt, collections and payments of a Central Government, state governments and union territories.

Commenting on the successful deal, Arun Jain, Chairman & CEO, Polaris Software, said, "I am delighted that after stringent evaluation of the Next Generation architecture of Intellect, RBI chose Polaris. The trust that the RBI has shown in us reaffirms our investments in building highly scalable yet open SOA technology. I dedicate this deal to the Polaris Product Engineering group and their commitment towards building such a high performance system."

In recent years the move to outsource IT or business processes has really taken hold. There are many reasons why an organisation may choose to outsource all or part of their database management system. The obvious answer is to save money and of course that is a major factor, however, it’s not the only reason for looking at outsourcing.

From speaking to our customers we see a range of different reasons for outsourcing database management. Cost is certainly one of those, as you’ll see below, but we also found a few others.

These are the top 5 reasons we see from our customers for choosing to outsource all or part of their DB2 database support:

# 1 Cost – In a tough economic environment, IT budgets are static or reducing. People continue to consume an increasing proportion of the IT budget. This is especially true for highly skilled staff such as database administrators.

It is often the case that DBA (database administrator) teams are overstretched and need more hands on deck but with pressure to keep headcount down there is no chance of employing an extra person. By utilising an external support provider, organisations can benefit from additional DBA support far more cheaply than if they had to employ another permanent member of staff. This combination of in-house and external support works well for many organisations and can be particularly helpful when dealing with the issues associated with cover – which is our next reason!

# 2 Cover – High or continuous availability is a common requirement for today’s “on demand” IT Systems and this can put pressure on small or overstretched DBA teams. Even without a 24x7 support requirement there can be issues with cover when holiday, sickness or maternity and paternity leave are considered.

Taking out an “out of hours only” support contract can be a cost effective way of managing cover during evenings, weekends and bank holidays. In addition, many support organisations also offer a “call-off” package whereby customers can use hours as and when needed. This type of contract is ideal for coping with either planned absences such maternity or paternity leave or unplanned absences such as sick leave.

# 3 Proactive vs Reactive – Expert DBA skills are often needed on different projects and so DBAs can find themselves spending more time on non-core functions. This means that the vital monitoring and management of the database can be sidelined. Overworked DBA teams may not have time to proactively monitor the database. Instead, only reacting once a problem has occurred and business users are already feeling the effects.

It is important when taking out a remote support contract, to check whether the service provider can offer proactive monitoring. This takes away the concern of problems cropping up unexpectedly and more often than not potential issues are noticed and dealt with before users are even aware of an issue.

# 4 Keeping up-to-date – it is increasingly difficult for DBAs and the organisations they work for to keep up to date with the latest database technologies. Database software is becoming more complex and takes years to master. Training is not only costly in terms of the price but also in time, with key DBA staff needing time out of the office. A managed support service can cover any gaps in knowledge within the team and most support organisations can offer training if required.

In addition to staff keeping up to date, sometimes it’s actually the organisation which is not on the latest database version. In some instances organisations are forced to stay on older, unsupported database releases. Skills for these older versions are hard to come by and lack of vendor support can mean a significant risk to the business.

Most service providers will be able to offer support on those systems which are officially “out of support” from the vendor thus taking away that element of risk.

# 5 Lack of skills in-house – We see organisations who do not have any DB2 skills in-house and organisations who have skills in-house but access to those skills is limited.

Some organisations will inherit DB2 systems through expansion or acquisition and do not have the skills in-house to support it. Whilst their own IT team may be able to cope for a while if any real issues come up, a support organisation needs to be called in.

Access to in-house skills can be a problem when DBAs are pulled into different projects and so have less time to spend on day to day maintenance. Their skills are often in great demand which can take them away from the routine tasks, again this is where an external support organisation can step in to take some of the strain.

Each organisation is different and their specific reasons for choosing to outsource will vary but there are many common themes. The need for quality support and technical excellence is of course paramount.

Triton Consulting offer a range of DB2 resourcing, outsourcing and training services.

As well as all the large, well-known outsourcing providers there is an army of smaller, niche service providers out there who are expertly placed to provide high quality support. Rather than outsourcing their IT systems lock stock and barrel, organisations can look to supplement their internal resources with niche technical skills for interim staffing, ad-hoc consultancy or even just as an “insurance policy” back-up. Rather than outsourcing to a good “all-rounder”, organisations should look to specialist providers for the in-depth technical knowledge required to support mission critical systems.

Sometimes organisations looking to outsource can be put off by the relative small size of a potential services partner, however, size isn’t everything. A niche services provider may be smaller than one of the large integrators but these organisations really know their stuff. They have to because whether it’s database management, business process outsourcing or HR services, that service is at the core of their business.

These organisations live and die by their reputation in the market, word of mouth is still one of the strongest marketing tools. The old adage “jack of all trades, master of none” is one which specialist service providers are very familiar with, these organisations are good at what they do and do only what they’re good at, rather than trying to offer a bit of everything.

A niche services provider can bring expert and often quite rare skills into an organisation. Access to specialised resources, which may not be available or are in short supply internally, is a major factor for businesses looking at outsourcing, especially in terms of database management services.

One of the key benefits of using a specialist service provider is the deep level of skills in their particular industry or technology. Specialist service providers bring insight into how other companies are solving similar issues. These “war stories” from previous engagements can really help build a customer’s knowledge of best practice.

War stories

In working with may different types of customers over the years Triton have come across almost every database support issue possible!

One of our customers was running DB2 LUW and they had outsourced development to an offshore organisation as part of a larger outsourcing agreement. They had just a small admin/support function locally, with no local DBA (database administrator) resource.

The offshore developers were complaining about poor query performance and were asking to move to another RDBMS (relational database management system). The offshore developers were extremely highly skilled in SQL. However, they had only basic database knowledge and no DB2-specific skills at all.

Working with the local admin staff and the offshore development team, Triton’s consultants were able to put in place a basic set of automated housekeeping routines which resolved performance issues.

The moral of this story is really about choosing the best supplier for outsourcing. Often a “one size fits all” approach isn’t the best way. By combining skills from the niche service providers, organisations are able to ensure that they have the appropriate skills available.

Triton Consulting offer a range of DB2 resourcing, outsourcing and training services.