Industry news

Malaysia’s strong talent pool and advantages have placed it among the top three Shared Services Outsourcing (SSO) destinations in the world.

Quoting this from a study by global management consulting firm AT Kearney, Prime Minister Datuk Seri Najib Tun Razak said: “Thanks to Malaysia’s multi-cultural environment, the ranking enables the

country to offer multiple language skills and a high-value workforce capable of interacting as well as meeting the needs of customers across the globe.”

He said there were almost 140 foreign and 60 local companies in the country now performing various SSO activities, ranging from IT and business process outsourcing to knowledge process outsourcing.

Najib said the sectors covered by the companies included energy, chemical and resources.

The Prime Minister was speaking at the opening of the Acre Hewlett-Packard (HP) Global Centre here yesterday.

Built on a 25ha site, the centre will host multiple core functions such as global applications development and support, global finance support and enterprise contacts.

It also has a state-of-the-art next-generation data centre.

Najib said information and communications technology (ICT) was a key enabler in the country’s ambition to achieve a high-income developed nation status by 2020.

“It is no surprise that 85 of the 131 identified entry point projects under the Economic Transform­ation Programme are driven or enabled by ICT.

“It is our belief that to achieve these lofty goals we must be bold enough to break convention and, ultimately, strive towards creating an innovative digital divide that stimulates new technologies, outlets and opportunities.”

Touching on the Multimedia Super Corridor (MSC) designed to leapfrog the country into the information and knowledge age, the Prime Minister said MSC Malaysia would complete its second phase this year.

“I am happy to report that the results are more than satisfactory,” he said, adding that in 14 years, 2,500 MSC-status companies had been created with a combined contribution of more than RM35bil towards the country’s gross domestic product.

Source: http://thestar.com.my/news/story.asp?file=/2010/10/13/nation/7215561&sec=nation

Asia-focussed bank Standard Chartered (STAN.L) launched a $5.3 billion (3.3 billion pound) rights issue to bolster its finances for new capital rules and provide the firepower to take advantage of growth opportunities, it said.

The bank said it made record profits and income in the third quarter and for the first nine months of the year. Income in the third quarter rose faster than the first-half run-rate and trading levels were almost back to levels of before the financial crisis, it said.

The bank wants to boost its capital "to continue to seize opportunities across Asia, Africa and the Middle East," it said, adding that the new capital rules could have constrained its asset growth unless new capital was raised.

Regulators, seeking to prevent the repeat of the global credit crisis, agreed last month to force banks to increase the amount of top-quality capital which they must hold in reserve.

Standard Chartered, based in London but deriving over three quarter of its profits in Asia, follows Deutsche Bank (DBKGn.DE) in raising capital due to the tougher capital rules, after the flagship German lender this month raised 10.2 billion euros (9 billion pounds), in part to meet the new rules.

StanChart said it would offer shareholders the right to buy one new share for every eight shares held at a price of 1,280p, a steep 33 percent discount to its last price in London.

The bank's core tier one capital ratio of 9 percent at the end of June was comfortably above the new requirement of 7 percent. The rights issue will raise that level to about 11 percent, although the new capital rules will force it to apply a higher risk weighting to its assets, which could reduce that ratio by 1 percentage point, it said.

Under the new Basel rules the definition of core tier one will be tightened so that common equity and retained earnings must make up the bulk of a bank's capital base. This means many banks' core tier one capital ratios will be substantially lower under the new rules than they are at present.

"Basel regulations will be difficult for some Western banks and they want to jump ahead of the line in raising capital before some of the European banks do that," CLSA analyst Daniel Tabbush said. "It could be the case that Basel regulations penalise more so banks like Standard Chartered and HSBC (HSBA.L) (0005.HK) within Asia, as they are more cross-border."

CAPITAL RULES

StanChart said Singapore state investor Temasek TEM.UL, StanChart's biggest shareholder with about 18 percent, will support the rights issue.

Some banks believe that to maintain a reputation for financial strength, they need to pre-empt the full impact of the new Basel III rules, which will be introduced gradually by 2019 and will redefine how the ratios are calculated.

The new tier one requirements also mean banks have to set aside more capital to offset their underwriting activities, which StanChart has been stepping up aggressively this year.

StanChart has been particularly active in Asia, where it has been involved on underwriting big loan deals for Bharti Airtel (BRTI.BO), Vedanta Resources (VED.L) and BHP Billiton (BLT.L), according to Reuters Basis Point.

In August, StanChart posted a record half year profit of $3.12 billion as key markets in Asia performed well and bad debts more than halved.

StanChart's Hong Kong-listed shares (2888.HK), which had been suspended pending an announcement following an earlier Financial Times report, were down 2 percent at HK$225.00.

The Hong Kong portion of the offer will be priced at HK$156.82 a share.

The capital raising could also be to send out a message that it was not up for sale, CLSA's Tabbush said.

StanChart is up some 21 percent this year, comfortably outperforming the DJ Stoxx 600 European banking sub-index .SX7P, which is down 4 percent.

StanChart Chief Executive Peter Sands told Reuters last month the new capital and liquidity rules for banks are complicating the economic recovery.

He estimated trade finance costs could increase by 20 to 40 percent as a result of the Basel III rules.

Source: http://uk.reuters.com/article/idUKTRE69C0OL20101013?pageNumber=1

Capgemini opened the doors on a new data center near London on Tuesday that it sees as a showcase for green design.

As if that wasn't enough, the company has also paid attention to the sourcing and eventual recycling of the materials used, and the problem of urban sprawl.

Merlin will have a power usage effectiveness, or PUE, of around 1.1, according to Capgemini. PUE is the ratio of the overall power consumption of a data center, including lighting and cooling, to the power used by the IT equipment: with a PUE of 1.0, all the power would go to the IT equipment.

The industry average PUE is somewhere around 2, according to Capgemini, meaning that about half the power is used for cooling and other functions. Many recent data centers do far better than that: In February, Hewlett-Packard opened one in the northeast of England that uses cool sea breezes to achieve a claimed PUE of 1.16, and in September Yahoo opened one near Niagara Falls that it said had a PUE of 1.08.

Both HP's and Yahoo's data centers rely on cunningly designed buildings on special sites to optimize cooling, but Capgemini's is in a former paper warehouse in Swindon, England, far from the sea or spectacular waterfalls.

"We wanted to use an existing building," said Dicketts.

To achieve its low PUE, Capgemini uses 250-square-meter prefabricated modules from a company more used to building field hospitals and ventilation systems for the chemical industry. Their hot-aisle, cold-aisle construction allowed the modules to achieve a PUE of 1.08 in factory tests, but there will be additional power losses on site, raising the effective PUE to around 1.1, the company said.

The modules arrive in three truck-sized pieces and are assembled on site. They could be installed inside any building large enough for the crane to enter, said Dicketts -- or they could just be set on concrete bases outdoors. The building is not necessary for their protection, he said, although it adds to security and to the comfort of staff moving between the different modules. This makes Capgemini's approach suitable for many brownfield sites -- almost anywhere with the necessary power and telecommunications infrastructure, he said.

Merlin contains four modules to date, with room for 12 more. In principle, Capgemini could go further: "We could double-deck the modules: It's feasible, technically," said Dicketts, adding that it might make more sense to build a second site nearby, for redundancy or disaster recovery, rather than expand the existing one.

Only two of Merlin's modules are full so far, one occupied by one client and the other shared by three. When the time comes to expand, Capgemini will add new modules four at a time, to simplify the construction of the necessary power systems.

The site has back-up generators, and its uninterruptible power supplies rely on flywheel generators rather than lead-acid batteries, a move intended to reduce the potential environmental impact of the site.

Source: http://www.pcworld.com/businesscenter/article/207578/capgemini_opens_merlin_data_center_in_uk_with_pue_of_11.html

Hewlett Packard has been accused of sending foreign staff from overseas offices to Britain to carry out the tasks of redundant workers.

The computer giant announced on Monday that it would cut a further 1,300 staff in Britain, as part of sweeping redundancies taking place worldwide. However, Unite the union has alleged HP could be abusing migrant worker law by using the intra-company transfer (ICT) system to transfer cheaper, foreign staff to Britain to replace those workers who are losing their jobs.

Any such move would be illegal and could leave the company open to costly tribunal claims from redundant workers for unfair dismissal if it was true.

Peter Skyte, national officer at Unite said: "Some of our members believe the company is playing fast and loose with the ICT system." He added: "ICTs are not supposed to lead to the displacement or replacement of UK workers, but some members allege that HP is using workers from outside the UK to do the work [of redundant workers] here. They see HP transferring workers from outside the UK to do the job."

Beachcroft law firm warned the company would have to provide a "robust defence" against potentially hundreds of claims for unfair dismissal if the ICT allegations reached a tribunal. Alex Lock, employment partner, said HP could be forced to formally dispute the claims during the 90-day consultation process which will now begin following the latest redundancy an [if HP was found guilty]," Mr Lock said.

However, an HP spokesman "unequivocally" denied the allegations. He said the union had already made the claims once before "earlier this year". He said: "These allegations have been made before and we did look into it in quite some depth. We informed the union of the outcome of that case. There is no evidence that we were not complying with the visa regulations."

By next April, HP will have cut nearly 6,000 jobs in Britain over the past two years, according to Unite.

Source: http://www.telegraph.co.uk/finance/jobs/8059709/Hewlett-Packard-denies-hiring-overseas-staff-in-Britain.html

Almost half a million people in the private sector will lose their jobs as a result of public spending cuts, new research suggests. The number is the same as the Government expects to cull from the public sector by 2015.

For parts of the UK, it will mean one in 20 people lose their job over the next four years as a result of the £83bn public spending cuts to be announced by the Chancellor next week.

Private sector output could be slashed by £46bn, or 2pc of the total, consultants PricewaterhouseCoopers (PwC) said. This would not be enough to push the economy back into recession, it said.

However, it is forecasting, that the private sector will only generate around 1m new jobs over the next four years in areas such as outsourced business services and social care.

This is far fewer than the 1.6m new jobs predicted by the independent Office for Budget Responsibility in June.

Of the industry sectors most exposed to the spending cuts, PwC said business services will shed 180,000 jobs and construction 100,000.

Job losses across the public and private sector are likely to hit 5pc of the total workforce in Northern Ireland, and 4pc in Wales, Scotland and the North East, although overall more jobs will be lost in London and the South East because their economies are larger.

UK-based manufacturers of leather goods and footwear, electronic components, weapons and ammunition and office machinery and computers will all be hit hard by the cuts, PwC predicted. Nick Jones, PwC director, said: “Businesses have been scenario planning and making contingencies but now it is going to become very real.”

John Hawkesworth, PwC’s chief economist, said addressing the budget deficit would help keep interest rates low for longer, benefiting businesses. But rising taxes and a weaker international trading environment would “dampen down growth significantly”.

Dave Prentis, general secretary of Unison, said: “This report bears out all we have been warning over the past few months. Public spending cuts will damage the economy and will drag the country into a downward spiral.”

Sourve: http://www.telegraph.co.uk/finance/jobs/8060539/Government-spending-cuts-will-see-a-million-people-lose-their-jobs-says-PwC.html

The UK's critical infrastructure - such as power grids and emergency services - faces a "real and credible" threat of cyber attack, the head of GCHQ says.

The intelligence agency's director Iain Lobban said the country's future economic prosperity rested on ensuring a defence against such assaults.

The internet created opportunities for hostile states and criminals, he said.

For example, 1,000 malicious e-mails a month are already being targeted at government computer networks, he said.

Speaking to the International Institute for Strategic Studies, Mr Lobban said he did not want to go into detail about the threat to the UK's "critical national infrastructure".

But he said the threat posed by terrorists, organised criminals and hostile foreign governments was "real and credible" and he demanded a swifter response to match the speed with which "cyber events" happened.

Critical national infrastructure also includes sectors such as financial services, government, mass communication, health, transport, and food and water - all of which are deemed necessary for delivering services upon which daily life in the UK depends.

With both the Strategic Defence and Security Review and the Comprehensive Spending Review due to be published next week, Mr Lobban said ministers would be looking at what capabilities the UK needs to develop further.

"Clearly they will also be deciding how they trade off against other spending priorities."

He added: "Just because I, as a national security official, am giving a speech about cyber, I don't want you to take away the impression that it is solely a national security or defence issue. It goes to the heart of our economic well-being and national interest."

Intellectual property theft

While GCHQ is more usually associated with electronic intelligence-gathering, Mr Lobban stressed that it also had a security role, referred to as "information assurance".

He said that they had already seen "significant disruption" to government computer systems caused by internet "worms" - both those that had been deliberately targeted and others picked up accidentally.

Each month there were more than 20,000 "malicious" e-mails on government networks, of which 1,000 were deliberately targeted at them, while intellectual property theft was taking place on a "massive scale" - some relating to national security.

And there was a "big challenge" with the government wanting to get more and more services online, he said.

"Cyberspace lowers the bar for entry to the espionage game, both for states and for criminal actors," he said.

While 80% of the threat to government systems could be dealt with through good information assurance practice - such as keeping security "patches" up to date - the remaining 20% was more complex and could not simply be solved by building "higher and higher" security walls.

Export expertise?

Although cyberspace presented a potential security threat to the UK, Mr Lobban said that it also offered an opportunity if the UK could get its defences right.

"Fundamentally, getting cyber right enables the UK's continuing economic prosperity.

"There's a clear defensive angle. In order to flourish, a knowledge economy needs to protect from exploitation the intellectual property at the heart of the creative and high-tech industry sectors. It needs to maintain the integrity of its financial and commercial services."

But he added that the implications were wider than that.

"There is an opportunity which we can seize if government and the telecommunications sector, hardware and software vendors, and managed service providers can come together.

"It's an opportunity to develop a holistic approach to cyber security that makes UK networks intrinsically resilient in the face of cyber threats.

"That will lead to a competitive advantage for the UK. We can give enterprises the confidence that by basing themselves here they gain the advantages of access to a modern internet infrastructure while reducing their risks."

He said developing such expertise would also open up potential export opportunities, with the global market for cyber security products "growing faster than much of the rest of the global economy".

Source: http://www.bbc.co.uk/news/uk-11528371

The cuts, which come on top of up to 900 job losses announced in June, were immediately attacked by Unite as "butchery" of the company's UK workforce while the jobs were exported to different locations abroad.

Nearly 4,000 jobs have now been shed at HP in the UK over the past two years, with the figure now set to rise to nearly 6,000 by next April, Unite said.

HP forced Hurd to resign after private settlement Peter Skyte, Unite national officer, said staff morale had hit rock bottom following "quarter after quarter" of redundancy rounds. "It is becoming impossible for the workforce to work while they have an axe continuously over their heads," he said. "Morale has slumped and it is affecting productivity."

He added: "Lax employment protection in the UK compared to other European countries means that the UK is bearing the brunt of the cuts, as it's quicker and cheaper to sack UK people and export their jobs abroad."

The world's leading personal computer manufacturer announced in June plans to cut a further 9,000 jobs worldwide as it made a $1bn (£680m) investment in fully automated data centres, although the full impact on UK jobs was not known until Monday.

Mr Skyte said: "It's not exactly a recipe for efficiency and productivity. It's been nearly five months between the worldwide announcement and the [latest] UK one."

Unite refused to rule out strikes over the latest job cuts. HP staff who are members of the PCS union and working on government contracts walked out on a two-day strike in March this year in a row over job security and pay. Mr Skyte said: "All action will be considered including industrial action."

Alex Lock, an employment partner at Beachcroft law firm, said HP was acting within the law when it came to moving the jobs offshore. "Lots of companies are basically shipping off some parts of their basic workforce functions to countries like India and Africa."

He added the trend had "accelerated" during the recession as businesses were under pressure to cut costs. "You can get people there [overseas] to do essentially the same tasks, or provide the same technical facilities, but pay them a 10th of what you'd pay them over here."

Last year HP cut more than 700 jobs in the UK as part of a worldwide reduction of 5,700 workers. The job losses were on top of the company's previous plan to reduce its global headcount by 24,600 and shrink its wage bill by 5pc.

In a statement about the latest job cuts, the company said: "HP is in consultation with the appropriate representative bodies within the UK regarding potential workforce changes which were announced June 1st, 2010. This is an initiative to transform HP's enterprise services business to benefit clients through new offerings and improved service delivery."

HP has about 304,000 staff in about 170 countries.

Source: http://www.telegraph.co.uk/finance/jobs/8057334/Hewlett-Packard-to-cut-1300-UK-jobs.html

According to Indian diplomatic sources, New Delhi will use its place at the high table of the world's leading powers to push for UN reform to reflect the rise of growing powers like itself, Brazil and South Africa.

India will take up its place on the 15 member council as a regional representative of Asia following a vote at the United Nations General Assembly. It will join its ally South Africa, Colombia and two countries out of Germany, Canada and Portugal.

All four of the 'BRIC' countries – Brazil, Russia, India and China, the world's fastest growing economies – will sit together on the Council for the first time, strengthening the hand of the world's growing powers.

Pranab Mukherjee, India's finance minister and second most powerful figure in Indfia after the prime minister, last week intensified New Delhi's campaign for a permanent seat at the Security Council and a shake-up of the global power structure which emerged following the second world war.

During a visit to Washington last week, he said:"I do hope that as and when the expanded Security Council along with the general reforms of the United Nations take place, India's claim for being a permanent member of the Security Council will be considered and accepted."

India's former foreign secretary and High Commissioner to London Lalit Man Singh said his country will now use its influence, along with its allies, to intensify the pressure for reform.

"The Security Council needs reform. Permanent membership went to the victors of the Second World War but so much has changed since then. It should reflect the reality of 2010 not the reality of 1945.

"India joining the Security Council takes us a step closer to permanent membership, things are looking hopeful," he said.

Source: http://www.telegraph.co.uk/news/worldnews/asia/india/8056489/India-to-be-given-place-at-UN-top-table.html

Becta, the government body in charge of ICT in schools, will see its research, procurement and interoperability work transferred to other parts of government next year, following the announcement in May that the body will be closed down.

Becta said that it expects to make an announcement later this month, when negotiations with the Department for Education and the Department for Business Innovation and Skills are concluded.

“There has been some notification in a general sense that certain functions of Becta’s work will be transferred, such as procurement,” explained a Becta spokesperson.

“And there is still a need for the research we were doing, as well as the work that is being done on interoperability – but at the moment we’re looking at which elements of that project work will be transferred.”

Becta has also been involved in researching how the Systems Interoperability Framework standard could work in practice in the UK education sector.

The spokesperson added that negotiations between Becta, the Department for Education and the Department for Business Innovation and Skills are in the final stages.

“We’re in talks with staff and unions and will have a more definite idea of functions that are transferring at the end of October 2010,” the spokesperson added.

Source: http://www.computing.co.uk/computing/news/2271298/becta-confirms-government#ixzz129WJuO5j

The Information Commissioner's Office (ICO) has opened a consultation process about its ideas for a new code of practice for sharing personal data between companies and organisations.

The move comes in the wake of a number of high-profile incidents where personal data has been lost, leaked or stolen by among others local councils. In fact, the NHS is said to be the worst offender in the public sector.

“We want citizens and consumers to be able to benefit from the responsible sharing of information, confident that their personal data is being handled responsibly and securely,” it says.

The UK privacy watchdog has in response issued a draft of what it says could become a model for best practice on handling personal data by public, private and the Third Sector.

The ICO says organisations that handle personal data are invited to offer their comments on the draft code, which would be strictly voluntary if any suggestions go beyond the main UK legislation on the topic at the moment, the Data Protection Act.

Suggestions include criteria on when or if personal data should be shared at all, when and how individuals should be told about such sharing, the appropriate security and staff training measures that must then be put in place and spells out what rights an individual asking to access such data ought to have.

The draft code aims to clear up somewhat murky areas like one-off requests for data and how they should be handled – e.g. when a school passes information about a child to a social services department or a GP sends a patient's record to a hospital.

The priority must be that citizens' and consumers' rights under the Data Protection Act are respected, stresses the Commissioner. this can cause serious harm.

The consultation runs until the start of the New Year.

Source: http://www.publictechnology.net/sector/ndpbs/ico-looks-new-way-protect-our-data