Industry news

Most organisations today are pretty aware of the problem of 'e-waste'. Dealing with it in a responsible manner is high on their list of corporate social responsibility (CSR) objectives. And for many organisations, the best way to do this is to outsource the process to professional, third-party specialists who will wipe any data held on equipment, prepare the kit for reuse elsewhere or strip it down for recycling.

But how do you know these companies will do what they promise with your old computer equipment? How do you know that they won't just tip your unwanted PCs into a shipping container and sell it abroad to the highest bidder?

That may sound far-fetched - but according to Tony Roberts, CEO of Computer Aid International, a charity that provides quality, professionally refurbished computers to projects in developing countries, the problem of e-waste 'rogue traders' is real.

“UK companies are unwittingly handing over their unwanted IT equipment to unscrupulous illegal traders who are shipping untested and un-wiped e-waste, for profit, to developing countries," he says. "These traders do not declare the contents of their shipments as hazardous e-waste, but falsely claim consignments consist entirely of electrical equipment destined for productive reuse in developing countries."

It's a scandal and most businesses will want no association with this toxic trade. But how can they be sure that their company's reuse and recycling partner is legitimate?

Fortunately, Tony Roberts and his team are so concerned about they problem of e-waste cowboys that they've produced Your Guide to Choosing an IT Disposal Partner in order to help companies sort the good guys from the bad. This includes seven questions that companies must ask of prospective providers, examples of the kinds of documentation they need to ask to see, and further ways of checking prospective recyclers' responses. It's thoroughly recommended reading for any company that really cares about e-waste.

Demand for IT services will not show a major rebound in the next 12 months as a result of the slow recovery projected for European economies, according to recent research from IT market research company IDC.

Though demand is likely to remain flat in 2010, say the company's analysts, 2.2 percent growth is anticipated for 2011. Overall, the Western European IT services market is expected to grow at a compound annual growth rate of 3.4 percent between 2010 and 2014.

In 2010, however, improving business sentiment won't result in a swift turnaround in fortunes for the IT services market. "IT budgets have stabilised, and in some cases show some growth, but strong price pressure will limit the market’s recovery capacity in the short term," say IDC analysts. A willingness among companies to offshore work will continue to drive project prices down, for example, while virtualisation will put pressure on the value of contracts and partly offset market growth throughout the forecast period.

In the short term, projects driven by cost concerns will remain a high priority. "We expect the ‘growth agenda’ to return slowly, bringing investments in business intelligence and industry-specific solutions, as well as the global rollout/integration of applications, when these solutions can support business growth, towards the end of the year,” said Laura Converso, research manager at IDC European Software and Services.

In geographic terms, the Nordics, Germany and the UK are predicted to outperform the European average throughout 2010. Growth in France is expected to be in line with the European average, while Benelux, Italy and Spain will continue to perform below the market average over 2010.

Mahindra Satyam has announced that it has successfully completed the key integration testing phase for its online event management system (EMS) for the 2010 FIFA World Cup.

This system will be responsible for coordinating and providing information for all of the FIFA officials, volunteers, event support staff and world press, as well as handling logistical issues involving transportation.

It has already undergone rigorous testing at the 2009 FIFA Confederations Cup and multiple other FIFA competitions, to fine tune it for optimal performance at this summer’s tournament in South Africa.

In this latest phase, the EMS was tested to ensure that it works well with other systems within the World Cup infrastructure and can handle large volumes of concurrent users. Its security, speed and efficiency at communicating with other communications systems, including other applications within the local data centre, were also analysed. The testing phase took over 10 days to complete.

Commenting on the challenges involved, Dilbah Gill, head of sports at Mahindra Satyam, said: “We have invested around three hundred man-years of effort in developing, testing and refining this web-based event management system for one of sport’s largest international showcase events. It has required us to call upon a vast range of our company’s core skill sets and, on top of that, it’s the first major sporting event of this magnitude to take place in a developing country."

The fact that the integration tests all went ahead smoothly, he added, "is a testament to the quality of the work that has been carried out on this project over the last few years.”

Indian outsourcing companies should create ombudsman roles and put in place 'whistleblower' policies so that employees can report concerns about how the business is being run. Those are just two of the recommendations that India's NASSCOM (National Association of Software and Service Companies) is making in a report released today.

The NASSCOM Corporate Government Report outlines best practices that aim to establish high standards of probity and corporate governance within the Indian IT services and business process outsourcing (BPO) industries. It has been produced by NASSCOM's Corporate Governance and Ethics Committee, established last year against the backdrop of the Satyam scandal and chaired by Infosys founder, non-executive chairman and 'chief mentor', NR Narayana Murthy.

Among the key areas the report focuses on is company structure, and in particular, the independence of non-executive directors from a company's executive management.

The report also recommends that companies adopt a 'code of conduct' with customers, in areas such as data security and intellectual property protection, and also with employees, including promoting learning, equal opportunities and appropriate grievance handling.

Commenting on the report, NR Narayana Murthy said, "The IT-BPO sector goes beyond just regulatory compliance and involves robus governance practices and ethical behaviour, which not only hinges on the functioning of the board, but also on how various, interconnected building blocks of the ecosystem work together. I am convinced that, with these guidelines, the Indian IT-BPO industry will become the flag bearer for the best practices in corporate governance across sectors."

Patni Computer Systems today announced that it has been awarded a multi-million dollar, five-year contract to provide policy administration services to Universal American, a leading US health insurance company.

As part of the deal, Patni is to acquire CHCS Services, a wholly owned subsidiary of Universal American. The acquisition creates a new hub for Patni in Pensacola, Florida and establishes a new line of business for the company as a Third-Party Administrator (or TPA) in the insurance and healthcare sectors.

Commenting on the development, Patni CEO Jeya Kumar said, "This represents the largest win in the company's history and this strategic acquisition of CHCS Services, Inc is a strong validation of Patni's differentiated micro-vertical strategy. This move takes on dual significance for Patni in terms of growing our global Life and Healthcare Insurance business as well as establishing us as a TPA."

In addition to its new, Pensacola-based hub, Patni's onshore delivery capabilities in North America also include centres in Bloomington, Illinois and El Paso, Texas, as well as a nearshore centre in Mexico.

Wipro, Tech Mahindra, IBM and HP are among the companies rumoured to be in negotiations with Telecom Corp of New Zealand for an outsourcing contract potentially worth up to $1 billion, according to reports in India's Economic Times.

"We are in early stages of reviewing our partnership arrangements and as such have asked several vendors to present us with options to review," a Telecom Corp spokesperson told the paper.

The deal is set to replace a $1.5 million IT infrastructure management contract signed with EDS (now owned by HP) in 1999, which expires this year.

According to outsourcing advisory firm TPI, 2010 will be a big year for contract renewals and renegotiations. Analysts at the firm expect between $10 billion and $12 billion in annual contract value due to expire this year to be renegotiated.

Mobile Telesystems (MTS) has become the first Russian mobile phone operator to outsource its core network operations to a specialist provider.

The company has chosen Nokia Siemens Networks (NSN) to handle the daily operation and maintenance of its entire mobile network across central Russia as part of a five-year managed services deal. Under the terms of the contract, MTS will transfer around 250 employees to NSN.

“Entering into a managed service agreement with Nokia Siemens Networks will allow MTS to substantially optimize network operations and increase efficiency while keeping service experience high for our customer base," commented Aleksander Popovsky, director of MTS Russia.

While the deal represents Russia's first full operation and maintenance managed services contract, it's an increasingly popular approach among mobile operators elsewhere in the world. NSN currently handles 240 managed services contracts in mobile and fixed networks, servicing more than 300 million subscribers. In March last year, it announced it would assume responsibility for Orange's mobile network operations in the UK, which serves 15.9 million customers.

“While managed services projects have already proved their efficiency worldwide, in Russia the experience of such project implementation will be unique and innovative," said Popovsky. "That is why we'll attentively follow up the progress in its development under local conditions. In the future, this will allow us to make the decision on introducing this approach to other regions.”

The Cloud Industry Forum, an organisation established with the aim of promoting trust, security and transparency within the sector, has launched its draft Code of Practice for public consultation.

CIF members met in March to agree the final content of the draft Code, with the goal of introducing a system of certification for cloud providers in the UK. Work on the Code began in October 2009 and CIF is now asking "end users, providers and other stakeholders" to participate in the consultation process by downloading the draft CoP and providing feedback.

"We firmly believe that the market needs a credible and certifiable Code of Practice that provides transparency of Cloud services such that consumers can have clarity and confidence in their choice of provider," said Andy Burton, Chairman of CIF and CEO of web hosting company Fasthosts. 


“Organisations seeking to use Cloud services need a straightforward form of certification or ‘Code of Practice’ for potential suppliers that will accurately define the services offered, standards of operation and security,” he added.

To register an interest in being a participant in CIF, or to download a copy of the CIF Code of Practice, visit www.cloudindustryforum.org

IT services provider 2e2 is to aquire systems integration company Morse for 51p per share, in a deal announced at the London Stock Exchange today.

The newly combined company plans to offer managed services, hosting, unified communications, data management, security, business application solutions and cloud computing services.

"There is an excellent fit between the two companies. [The deal] consolidates 2e2's position as one of the UK's leading vendor-independent IT services providers," said 2e2's non-executive chairman Eric Priestley. He added that he expects significant benefits to come from "cost synergies" and cross-selling opportunities within the enlarged customer base.

Private equity-backed 2e2 is strongest in the UK public sector. Earlier this month, it announced a three-year, £4.3 million deal to build and support a new ICT infrastructure for the London Borough of Waltham Forest. Morse's strongest vertical, meanwhile, is financial services.

The deal values Morse at close to £70 million.

Two years ago, I thought a cloud was something that appeared when you least wanted it to and obliterated the sun. Now, everyone is talking about The Cloud – private clouds, public clouds and so on. All in all, clouds are changing the way that computing happens.

So when late last year I heard another new term - the 'Intelligent Client' - I started to consider whether that expression, too, will become common parlance throughout the industry within the next year.

I first thought that I would like to know what an ‘Unintelligent Client’ is (no jokes, please!).

But then I heard people talking about more about it, and even about ‘thin’ and ‘thick’ intelligent clients. In recent weeks, I have even had a number of clients asking me about what an intelligent client is, whether should they become one, and how?

So what is this all about?

For years, we have heard about retained organisations – the small division of the outsourced function that remains within the client business, acting as an interface between client and supplier to ensure a high level of service. We have also heard about the need among organisations that have a range of suppliers to have a retained organisation structured correctly for best mutual effect.

The term 'Intelligent Client', which seems to be coming out of the public sector more than the private sector, suggests that, if we are to be optimal providers, and deliver the correct level of services to our customers and clients and be effective in receiving services, then we shouldn’t have separate retained organisations for HR, Finance and IT, and perhaps other functions, too. What we should be doing is taking a much more holistic look at how we shape our organisation.

So the Intelligent Client is very much a vision of a new organisational structure.

It requires an appreciation of what core competencies are needed internally to service the new structure; to what level they currently exist in the company; and what organisational designs (or re-designs) are required to ensure that these competencies can be exercised to the fullest extent, but with the lowest overheads.

Perhaps the most important questions to ask, and to ensure are answered before embarking on this course of action, are how will the new intelligent client manage each supplier, provide the necessary subject matter expertise and manage clients and customers?

So I am interested to gather feedback as to whether people are hearing this term being used, and if it is being widely realised as a concept. Will ‘Intelligent Client’ be as pervasive a term by the end of 2010 as cloud computing has been at its start?