Industry news

The third sector could grow by billions of pounds a year as a result of the government’s public service reforms, charity leaders were told today.

Stephen Bubb, chief executive of the Association of Chief Executives of Voluntary Organisations, told the organisation’s annual conference that the next five years offer opportunities for growth despite tough cuts to public budgets.

But, he added, the growth will not be universal, and many charities face ‘tough and turbulent times’, with some shrinking or closing altogether.

Bubb pointed to ‘opportunities amidst the gloom’, particularly in areas where ministers are considering setting guidelines for the proportion of services that should be outsourced.

The Comprehensive Spending Review identified areas the government considered ripe for more outsourcing, including adult social care, early years, community health services, youth services and court and tribunal services.

The third sector could grow by £2bn a year by 2015, he said, just through increased involvement in offender rehabilitation and public health.

In community health, charities only currently see about 7% of the £7bn spent a year, Bubb argued. ‘These are areas where the potential of our sector is almost entirely untapped.’

Bubb also called for the government to collect and publish more data on what it commissions from voluntary organisations, to make it easier to tell whether it succeeds in opening the market up to charities. ‘Otherwise, it will be shaping policy and spending public money in the dark.’

Source:

http://www.publicfinance.co.uk/news/2010/11/government-outsourcing-will-be-worth-billions-to-third-sector/

The "two tier code", used in public-sector outsourcing contracts, may be abolished in April 2011, Eugene Wojciechowski, partner at Shoosmiths, told delegates.

Wojciechowski, who was speaking in a session on the Tupe transfer regulations, said he had heard a rumour that the government were planning to abolish the code but had no further details as yet on how the change would be made.

The code, introduced by the previous government in 2003, is intended to protect employees recruited to work on outsourced public sector contracts from being hired at inferior rates compared to transferred employees, whose public-sector terms are preserved under Tupe. The aim was to prevent the creation of two-tier workforces.

The change will have a detrimental effect on those employees recruited to work on outsourced public-sector contracts, but will reduce the costs of the private-sector contractors taking on the work. This could ultimately be an incentive for the public sector to outsource more services, it is speculated.

Wojciechowski also said he had heard that a particularly contentious Tupe case, Alemo-Herron v Parkwood Leisure, was set to be appealed. The case, involving work outsourced from the London Borough of Lewisham, dealt with whether Tupe-transferred employees’ terms and conditions could be changed to reflect collective negotiations happening between the transferor and employee representatives after the transfer had taken place. If the employees’ claim were ultimately successful, this would be “pretty harsh on the new employer”, Wojciechowski said. The organisation would find itself covered by negotiations to which it was not a party.

On the first appeal, the EAT found in favour of the employees, but earlier this year the Court of Appeal found in the employer's favour and said only those terms in force at the time of the transfer applied. If the case is appealed again, it will go to the Supreme Court.

Source:

http://www.peoplemanagement.co.uk/pm/articles/2010/11/two-tier-code-for-public-sector-outsourcing-may-be-abolished.htm

IT firm Logica returned to modest revenue growth in the third quarter thanks to government outsourcing and banks using its services to help comply with new regulations.

Logica kept its full-year forecast for roughly stable sales and operating margin but today said it had agreed some reductions in the scope and value of government contracts.

Revenue grew 1% between July and September to £863 million and orders rose 8% to £758 million. Logica said it expected a strong fourth quarter as government outsourcing resumed and business from the Benelux countries improved.

“We are cautiously optimistic about our prospects for growth next year,” said chief financial officer Seamus Keating.

Logica shares were down 2.8% at 129.5p this morning, the weakest performers in a flat European technology index.

Logica said it expected UK revenue to grow in the fourth quarter, despite public sector cuts, and that it had seen signs of increased activity from government departments since the end of the third quarter.

The company has agreed with the Government that to continue its contracts, which span 55 government agencies. Public sector business accounts for about 10% of Logica's total sales.

But Keating said Logica was working with the Government to scale down some contracts.

Source:

http://www.thisislondon.co.uk/standard-business/article-23893965-logica-expects-growth-with-government-outsourcing.do

The National Outsourcing Association (NOA), the UK's only outsourcing trade association and the centre of excellence in outsourcing, today announced the appointment of new members to its Board of Directors after a member election.

The new members are:

Professional Services Board Member

Felicia Trewin is an outsourcing specialist working in Deloitte's Technology Integration Consulting practice since 2006, focusing on outsourcing, off-shoring and procurement advisory for a cross-industry client base. Prior to joining Deloitte, Felicia spent five years working for Microsoft's Global Outsourcing Team in both the UK and US.

Offshoring Board Member

Michael Stock has been an active member of the NOA for several years. He is employed by the BBC, currently project director for outsourcing Audience Services. His first project was to establish BBC’s first contact centre. Off-shoring has been a strong interest since 2001 producing one of the first reports and films on off-shoring, 'The Call for India'.

Suppliers Board Member

Tony Morgan is currently IBM’s Chief Innovation Officer for Strategic Outsourcing in the UK and Ireland. Since joining IBM Tony has worked exclusively within the outsourcing business in client roles. Tony’s experience includes the full lifecycle of outsourcing contracts ranging from solution development in new client engagements to Chief Architect roles on both newly signed and mature contracts.

Board Member for the North

Adrian Quayle has been on the NOA’s Board for a number of years and in February 2010 he was co-opted as the first NOA Board Member for the North and Midlands. Since then he has been actively working with NOA members and potential members to develop the NOA’s presence and activities in the Region. Adrian has organised and run successful Member Events in Manchester and Leeds. In addition Adrian took on the responsibility on behalf of the NOA Board of representing the outsourcing industry on the British Standards Institution (BSI) Committee drafting the new British Standard on Collaborative Business Relationships (BS11000).

The NOA Board Members are selected for their specific ability and willingness to contribute to the work of the NOA. Each individual is an outsourcing professional, from a variety of industry sectors each representing a different discipline from the outsourcing spectrum.

“The NOA is keen to utilise the expertise team in order to provide the best services focusing on delivering education, excellence and collaboration. We are involved in all areas of outsourcing, including: shared services, in-sourcing, ITO, & BPO and we’re confident that we have experts in each of these fields.” comments Martyn Hart, Chairman of the NOA.

He continues, “I am delighted that we have new members on board. 2011 promises to be an exciting year for us as we move forward and having new these skills will be an asset which will be highly valuable in delivering the NOA’s vision. Their leadership and support will bring additional energy and direction for our work.”

The overall direction of the NOA is established by its Board. The Board is comprised of largely c-level individuals representing outsourcing suppliers, end-users and support services from the NOA’s Membership.

Fujitsu has signed a Memorandum of Understanding with the government, following in the footsteps of fellow ICT suppliers including Microsoft, BT, Capgemini, and Atos Origin.

The Memorandums of Understanding follow meetings with Cabinet Office minister Francis Maude in July, as part of the Efficiency and Reform Group’s objective to come to fresh agreements over existing contracts, saving the government money in the process.

In a short statement, Roger Gilbert, CEO of Fujitsu UK & Ireland, said the company was “pleased” to respond to the requirements laid out by the Efficiency and Reform Group, “in a constructive and timely manner”.

“We are proud to have been providing innovative and efficient solutions to our public sector customers over many decades,” Gilbert added. “With the signing of this agreement we are looking forward to continuing our partnership with the UK Government through successfully exploiting technology to deliver ever more effective public services for the benefit of UK citizens.”

Fujitsu has had a relationship with the UK Government for more than 40 years, across some of the largest and most complex departments. According to the company statement, Fujitsu will “continue to bring its experience and expertise to enable the public sector to be more effective and save money and will continue to deliver all its existing contracts”.

HP today revealed further details of its previously announced $1 billion investment in offshore outsourcing, selecting six countries-Bulgaria, China, Costa Rica, India, Malaysia and the Philippines-as its global delivery hubs. Those six spots are "best for our clients and best for where our markets are headed," says Robb Rasmussen, VP and general manager, Best Shore, HP Enterprise Services. (Best Shore is what HP calls its global services delivery strategy within HP Enterprise Services.)

The company, which acquired IT service provide EDS two years ago, maintains that the restructuring will involved a total of 9,000 layoffs over the next two years as well as 6,000 new hires.

Source: http://www.cio.com/article/634869/Inside_HP_s_New_1_Billion_Outsourcing_Plan_

“IT’S the biggest deal of your life,” a Bournemouth councillor stressed to his colleagues at last night’s climatic meeting.

And his colleagues voted 34-12 for that deal – a controversial £150m agreement to transfer four departments to a private contractor, Mouchel.

The vote came after a two years of study and three council meetings this week alone. Monday’s went on from 6pm to 11.30pm. Mouchel will take over the revenues, benefits, ICT and facilities management departments for the next 10 years.

Unison fought the deal and branch secretary Dave Higgins said last night 88 jobs from just over 300 being transferred will be lost. He said the union will now work with Mouchel, but some of the debate must have hurt him and the dozen or so watching staff.

Cllr Beverly Dunlop questioned why council staff had not made sufficient improvements themselves over the past 5-10 years. “Any manager that needs to be asked to reduce costs and increase output is clearly not demonstrating the basic tool kit you would expect,” she said.

Tory leader Cllr Peter Charon said he’d got a stronger public reaction to the plans to close Hengistbury Head recreation centre.

Conservative members argued the deal is essential. It is supposed to save 40 per cent on the revenue budget on the next 10 years and create 650 private sector jobs. The Government grant to Bournemouth is dropping by 11 per cent next year alone so making savings protects services and saves jobs in the long run, they said.

The problem is, not everyone agrees – one of the council’s own section 151 officers, responsible for making sure money is spent properly, broke ranks to argue it could cost more than the current arrangement.

Cllr Ben Grower, Labour leader and the deal’s most vocal critic, told the Tory group Mouchel needed the council more than the council need Mouchel. “You talk about the council taxpayers as shareholders,” he said. “But why should council tax payers subsidise the shareholders of Mouchel?

“They won’t be getting a dividend this year, but presumably they will be getting one next now this deal is done.” He said afterwards we could expect them to throw resources at the deal for 4-5 years then the service would drop off to protect profits.

The contract is secret but a few details emerged. The council can stop Mouchel being paid for work it does not do, but it cannot impose penalties.

Steve Moriss, a managing director of Mouchel, said afterwards: “There’s a heavy responsibility on us to deliver and we are committed to doing that.

“The whole aim of the contract is to improve services, given the difficult budgetary constraints, and that’s what we’ve been able to do in our other partnerships.”

Source:

http://www.bournemouthecho.co.uk/news/8629542.__150m_outsourcing_deal_approved_by_Bournemouth_Council/

Eighteen months ago Richard Sykes forecast that the real outsourcing commerce of ‘the Cloud’ would develop in the form of Platforms. He now confirmes that judgement.

A platform? Consider the iApps platform: a technical construct in ‘the Cloud’ that enables innovative ventures to create and deliver new applications for the iPhone. The platform provides an integrated set of infrastructural (data processing, storage and network) and support services to the technical standards that ensure full compatibility with the iPhone – and these services scale rapidly if sales of the new iApp prove to be a runaway success!

PayPal is now positioning itself as a mobile banking platform ‘in the Cloud’, offering an increasing diversity of services for the management of personal accounts and payments through the increasingly intelligent mobile phone. Security is ‘in the platform in the Cloud’. There is a developers’ area of the platform (the first, PayPal claims, to be offered by a Financial Services company) with access to secure APIs. The old-fashioned signed cheque can be deposited by taking a photo of each side of the cheque and despatching the paired images.

Facebook is also now positioning itself as a platform, developing an increasing diversity of services for its over-500m active users on its core technology platform (that also claims to be the largest gaming platform in the world). It is eyeing its future as a potential replacement for the intranet in the large enterprise – it has recently launched a ‘Groups’ capability and argues that it is more in tune with the working culture of the Millennial generation that is now moving into, onto and up the corporate ladder. In this vision, the Facebook platform could be exploited to allow a more seamless interaction between the contemporary Enterprise and its customers.

In the meantime, salesforce’s well established force.com is gaining ground as a leading platform for the development of, and delivery of, business applications, particularly in the web services arena. It provides access to pre-built software components: 80% simple assembly plus 20% new code = more rapid creation of new applications.

So here is a new dimension to the Enterprise (out)sourcing strategy. The Enterprise will already have the essential elements of an internal platform on its infrastructure. Yet key to most businesses is effective & real time access to customers, suppliers and the supply chains that support external realities of the business model. The developing commerce of these ‘platforms in the Cloud’ may offer a new and innovative means for the sourcing of an exostructure able to support delivery of the outward facing aspects of the Enterprise business model.

Source: http://www.outsourcemagazine.co.uk/articles/item/3607-platforms-make-sense-in-the-cloud

Multimedia services for mobile networks in the region

Orange plans to open a new Technocentre in Abidjan, Cote d'Ivoire (Ivory Coast) in West Africa to support its growth plans in emerging countries, and in particular in sub-Saharan Africa.

The new facility is expected to develop and launch new products and services specifically designed to meet regional needs.

The new Technocentre will specialise in multimedia services for mobile networks including SMS, USSD (basic data services via a GSM network), WAP or Web-based services.

In addition, it will also work on offerings designed to facilitate access to the Internet for Africans everywhere by improving network accessibility and developing inclusive content-based services.

The new facility will also provide support for countries in the region as the roll-out of Orange Money accelerates over the coming months.

The company said Orange Money is the group's mobile payment service and is a key part of the strategy to improve customer fidelity in Africa.

Orange Africa Middle East and Asia executive vice president in charge of operations Marc Rennard said by providing a regional platform, the new Technocentre would reinforce the Group's capacity to develop new products and services specifically designed to meet the needs of sub-Saharan Africa.

"By drawing on local knowledge and expertise, the new Technocentre will enable us to develop innovative new offers in these areas that will create value both for our customers and the economy as a whole," Rennard said.

The Technocentre, which will open in Abidjan by the end of 2010, will join the group's network of 15 Orange Labs worldwide and will reinforce the existing research and development facilities in Africa and the Middle East.

Source: http://telecoms.cbronline.com/news/orange-to-open-new-technocentre-in-west-africa_101110

Accenture has completed its acquisition of Beijing Genesis Interactive Technology Co., Ltd., a Beijing-based embedded software services company that provides mobile software outsourcing services and solution licensing for companies in China.

The acquisition will build on the expertise, design, development, testing and outsourcing capabilities of Accenture Embedded Software Services, which helps clients innovate through the use of embedded software to deliver any product, service or solution faster and more cost-effectively across a range of industries. Those industries include mobile devices, automotive, medical equipment, and aerospace and defense.

“Embedded software has become a main differentiator for mobile devices and solutions driven by customer demand for ever smarter devices,” said Jean Laurent Poitou, managing director of Accenture Embedded Software. “As a result, our clients are looking for ways to increase the predictability and lower the development cost of new and emerging software technologies.”

Mogenesis developers offer a range of skills across multiple embedded software platforms, including Android, Symbian, Windows Mobile and LiMo. Mogenesis has been providing mobile software services since 2004.

“The Mogenesis team brings years of accomplished software engineering experience across market-leading mobile platforms and time-critical product development and solution licensing,” said Poitou. “The acquisition will enhance Accenture’s existing developer base in terms of both numbers and geographic reach, meeting rapidly increasing client demands for embedded software skills, particularly across Asia.”

Gong Li, Chairman of Accenture Greater China, said, “This acquisition will significantly strengthen Accenture’s mobile software and application development offerings to device manufacturers in China, and add to our capabilities to provide end-to-end value-added services on mobile devices for operators.”

Accenture’s record in embedded software includes helping original equipment manufacturers ship more than 300 different mobile phones worldwide. It has also helped chipset vendors create robust adaptation software, and in-vehicle infotainment (IVI) manufacturers run systems and operator testing.

“We see great synergy in combining our offerings in the embedded software market with Accenture’s consulting and technology outsourcing expertise, industry focus, and global reach,“ said Dennis Kung, chief executive officer, Mogenesis. “This will give clients all the benefits of working with a global leader like Accenture and the local skills and market knowledge of our people.”

Source: http://newsroom.accenture.com/article_display.cfm?article_id=5091