Industry news

Public Sector Bank UCO Bank has awarded IT and business transformation service provider Wipro Infotech signed a 7 year total outsourcing contract with five Regional Rural Banks (RRBs).

The contract is for implementing a Core Banking Solution (CBS) across 803 branches of RRBs under UCO Bank’s sponsorship.

With this initiative, all five RRBs would come under the ambit of core banking, thereby ensuring uniformity in technology platform and related business processes for improved business efficiency and customer care.

The scope of services includes building, hosting and managing the underlying infrastructure at the Data Centers, in addition to implementing the Finacle CBS across the five RRBs in question.

Wipro would also provide network management and user training across all 803 branch locations as a part of the Total Outsourcing relationship.

The CBS would be executed on an Application Service Provider (ASP) model where Wipro would get paid on a monthly pay-per-use basis. Roll out of all branches is expected to be completed by September 2011.

Global IT and BPO services provider has been awarded a seven-year contract with Serco Learning for the development and delivery of ‘Progresso’; Serco’s new information management platform for schools.

The Progresso platform is being designed by Serco and developed by Patni and will be available at the end of 2011.

The platform is a centrally hosted management information platform that provides relevant data, tools and services directly to schools, parents and local authorities.

It will reinforce the Serco Learning position as a provider of high quality and innovative solutions in education and over time will replace ‘Facility’, the existing platform

Serco will continue to provide direct user support and market direction for both, Facility and Progresso. Patni and Serco will deliver the new Progresso platform and then optionally host it as a managed service to schools, academies and local authorities.

Patni has also won a three-year contract from Codan Group part of the insurance giant RSA Group.

The seven-figure agreement will see Patni provide managed services around some of Scandinavia’s core insurance platforms.

The Codan Group, which operates in Denmark, Sweden, and Norway, invited five leading outsourcing companies including Patni to bid for the application management contract in September 2009.

It short-listed three vendors in March 2010 and made its final decision to appoint Patni in June.

Gordon Easden, financial services practice leader at FusionExperience, explores some of the concerns in the minds of fund managers when it comes to outsourcing.

Traditionally there has been reluctance within the fund management industry to widen the scope of the business processes fund managers outsource. Although many are happy to outsource back office functions such as fund accounting many are still slow to recognise the value of broadening the scope of operations they are willing to entrust to a third party. However, the outsourcing landscape has changed, creating the opportunity for fund managers to transform service quality and cost by outsourcing much more and much more cost effectively.

The present day outsourcing by fund managers is part of a continuum that started 15 years ago. At its inception, fund managers were happy to outsource basic back office functions but would not have been comfortable allowing access to more complicated or ‘core processes’ such as customer service for example. The evolution in those 15 years is illustrated in the development of outsourced customer service solutions. This has almost become a matter of course for fund managers. Many are also considering outsourcing to a centre of excellence that provides a more holistic service as it would be supported by much wider range of technologies at a cheaper price.

This evolution has presented the fund manager with a wide array of options when deciding what to outsource, a question that can sometimes feel a little daunting. It is important for a fund manager to consider its options holistically and develop an in-depth understanding of what its operations are there to do. Fund managers must have a handle on core structure and costs and an understanding of what is going wrong. This will help isolate what functions are advisable to outsource and which may not be necessary.

A concern for many in the industry when looking to outsource are the perceived risks involved. It is fair to say that in some cases, when not managed adequately, outsourcing can create risk. Fund managers run the risk of losing the capability and knowledge to run processes and also the possibility that too many processes are embedded with the provider. This can make it difficult for fund managers to migrate away or renegotiate contracts favourably. There is also the risk of choosing a provider that is not a specialist in the areas that they have been earmarked to outsource.

The industry undeniably has specificities that present challenges in outsourcing, but also illustrate the importance of it. Fund managers’ operations are rapidly evolving, particularly in the technology and regulatory landscape, from customer care to the evolution of the STP market place with regards to targeting and positioning. This necessitates a high level of reporting and presentation technology to cater for regulations that are in constant evolution. The average size of a fund management firm remains small so there is a demand for centralised and cheaper service.

Finally, as the UK emerges from the recession, the specifics of the fund management industry and the evolution in regulation have led to a much greater emphasis on transparency of reporting and compliance. Outsourcing providers with evolving platforms and new technologies can help fund managers move from more traditional monthly reporting to a daily reporting cycle that many clients have come to expect.

Exam results keep rising but pupils taking relevant subjects continue dropping

Hot on the heels of the recently announced A-level results, this week’s release of GCSE results indicated a rise in the pass rate – for the 23rd year in a row.

But if students are getting smarter, why is it that options/subjects such as languages and ICT have seen a drop in the number of pupils taking them?

In today’s multicultural/multilingual world, technology filters into all aspects of life; so does it make sense to opt of the subjects which could very well determine (or at least significantly influence) future job prospects?

“The IT industry may well value qualifications in areas other than IT, such as. Science, Mathematics etc, above pure IT subjects in the future,” observed Roger Newman, senior vice president at IT solutions provider Mahindra Satyam. “The next generation of knowledge workers, which are now entering higher education, have grown up with, and already have a good understanding of, the fundamentals of IT and so can develop into the type of person who can drive more business benefits from IT regardless of having a formal IT qualification.”

As the economy slowly recovers, demand for skilled labour will also increase. In this instance, the markets and industry knows what they need and know what they want. It needs skilled labour and it is ready to import or export it depending on the situation.

“The recent A-level and GCSE results suggest that there has been a general decline in the number of students taking IT subjects,” noted Newman “I believe it may be symptomatic of a shift in the types of skills that will be required in tomorrow’s IT workers. IT is now highly embedded in most business processes and businesses are increasingly using off the shelf applications and Open Source Solutions. It therefore follows that businesses rely on a higher degree of skill in understanding business processes and the application of technology to operations than the past.”

Newman stressed: “Somebody has to build the off-the-shelf applications and Open Source Solutions and, to do this; formal training in IT is required. In summary the decline in the number of people studying IT subjects will probably not affect outsourcing trends in the short or even medium term but will have a profound effect on the IT industry in the long term, unless a sensible balance is maintained.

In its August 2010 Labour Market Outlook survey, the Chartered Institute of Personnel and Development found that the demand for migrant workers has increased in line with improvements in the UK labour market during the past year.

The study surveyed 600 organisations of which 45% indicated that they had vacancies that were proving difficult to fill from the domestic labour market and were now looking overseas in a bid to fill the positions.

According to their figures about one in six (17%) employers intend to recruit migrant workers in the third quarter of 2010, which is above the previous peak of 15% recorded three months ago. Employers in the education and healthcare sectors are most likely to hire migrant labour (27% in each sector).

In a technology-based world, the budget cuts will continue affect the quality of education – among other public and social programmes – the outlook for Britain just keeps getting rosier…

Oslo-based aluminium firm Norsk Hydro has awarded Accenture a three-year application outsourcing (AO), which covers support and maintenance of two of Hydro's SAP systems globally.

The agreement is designed to improve the efficiency and cost-effectiveness of Hydro’s SAP-based business processes through an industrialized approach that offers higher quality and innovation.

The services will be provided to Hydro users in multiple countries by Accenture’s Global Delivery Network, using centres in Germany and India. The delivery of the outsourced services is scheduled to begin in October 2010.

Norsk Hydro and Accenture have worked together in the areas of consulting and technology services since the late 1980s.

The Lloyds Banking Group (LBG) has awarded Factbook, a specialist provider of fund reporting, marketing and data management solutions to the investment community a extension of their managed factsheet service.

LBG has chosen to migrate their Bancassurance factsheet production for both Halifax and Bank of Scotland to Factbook’s fully managed production environment, building upon the success of the earlier Clerical Medical factsheet project.

This latest roll-out sees peak monthly document delivery from the LBG production platform almost double to in excess of 250 retail fund factsheets.

The relationship between LBG and Factbook is already a couple of years old and it is expected to further develop over the coming months.

The Financial Services Authority (FSA) has fined the UK branch of Zurich Insurance £2.27m for failing to have adequate systems and controls in place to prevent the loss of customers’ confidential information.

This is the highest fine levied to date on a single firm for data security failings.

Zurich lost the personal details of 46,000 customers, including identity details, and in some cases bank account and credit card information, details about insured assets and security arrangements.

The loss could have led to serious financial detriment for customers and even exposed them to the risk of burglary; however there is not evidence to date to indicate that the data has been misused.

Zurich UK outsourced the processing of some of its general insurance customer data to Zurich Insurance Company South Africa Limited (Zurich SA).

In August 2008, Zurich SA lost an unencrypted back-up tape during a routine transfer to a data storage centre. The absence of proper reporting lines meant Zurich UK did not learn of the incident until a year later.

As Zurich UK agreed to settle at an early stage of the investigation the firm qualified for a 30% ‘discount’, without which the fine would have been £3.25m.

Comms vendor Avaya and telco BT have extended their global partnership for a further three years.

The telco firms are looking to deepen their partnership which covered contact centre equipment and services and explore new areas including voice and unified communications (UC).

As part of the relationship, BT will provide integration and consultancy services to support the Avaya product suite. Avaya and BT will jointly market and sell the products and services to businesses around the world.

The new agreement between the two companies covers next-generation contact centres, unified communications and services, and complements BT's portfolio of networked IT services.

Both firms have been working together for the past 10 years.

Following Avaya’s acquisition of former rival Nortel, its relationship with BT has been under close scrutiny from the comms industry.

Nortel, which entered Chapter 11 in early 2009, had a longstanding relationship with BT, signing a four-year partnership as recently as May 2009 – Avaya agreed a deal two months prior to that.

Global consulting and IT services provider Mahindra Satyam, the brand identity of Satyam Computer Services has appointed Gaurav Gupta as associate vice president, Strategic Partnerships in Europe for the Aerospace and Defence sector.

In this role, Gupta will lead development of customised partnership arrangements in the sectors of Aerospace and Defence. He will focus on building new business opportunities and, using the synergies of the Mahindra Group, convert them into large global relationships.

His appointment comes as Mahindra Satyam looks to strengthen its focus on specialty offerings for this sector and to meet the specific challenges facing the industry, namely; cost, time to market, and a need to maintain research and development at reduced costs.

Gupta has more than a decade’s experience in the industry which began when the Aerospace and Defence sector first started looking at outsourcing and off-shoring in a major way.

Prior to joining the Mahindra Group, he worked as a director of Business Development with HCL, based in the UK.

Unisys Corporation has been awarded a five-year extension on its contract to provide end-user support services to oil & gas supply manufacturer Flowserve Corporation.

Under the new agreement, valued at close to $37m, Unisys will provide ongoing and expanded services to support approximately 10,000 of Flowserve's employees in more than 50 countries worldwide for five years beyond the originally contracted 2011 expiration date.

The ongoing services include service desk support in nine languages, desk-side support, equipment maintenance, and installs, moves, add and changes for desktop and laptop PCs, BlackBerry smartphones, servers and printers.

Expanded services to be provided –from 2011 –will see Unisys implement its Converged Remote Infrastructure Management Suite service offering for Flowserve.

The solution provides a single, unified view of an entire IT infrastructure. It will enable Unisys to provide integrated monitoring and management of some 500 servers deployed in Flowserve locations around the world.

In addition, Unisys will implement an IT Services Management framework, based on the ITIL v3 standard, for continuous improvement in service delivery.

Unisys will also enhance both the self-service portal for Flowserve employees and the knowledge management solution that stores information about prior service events so that end users and service personnel can anticipate and more quickly resolve potential equipment problems before they lead to potentially costly downtime.