Industry news

The London School of Economics and Political Science (LSE) has decided to outsource its online presence, which it claims is the first deal of its kinds in the UK. Under the terms of the new contract, iomart Hosting will maintain a hardware platform that supports LSE’s website on secure servers located away from LSE’s London campus.

Stephen Emmott, head of web services in LSE’s communications department said: “Like most universities we have managed and hosted our institutional website on-site. In recent years we -including our colleagues in LSE’s IT Services- have come to the view that the level of service we require, particularly 24/7/365 availability, requires the services of an external supplier. We need to ensure that if there were any on-site problems, for instance with power, it wouldn’t affect the use of our website. It’s a good example of how the boundaries between academic institutions and the commercial sector can be developed into mutually beneficial relationships.”

The decision by LSE to outsource its web hosting has been made in hope of improved reliability and functionality, whilst increasing the scope and depth of information it can offer to both students and the wider population.

Budget constraints and ongoing restructure are set to be HR’s biggest challenges in 2010, according to a survey from recruitment process outsourcer Alexander Mann Solutions (AMS).

The Recruitment Barometer survey suggested that while the industry appears to be stabilising after the economic crisis with 66 per cent of budgets remaining unchanged and one fifth of budgets expected to increase in the coming year, HR departments will still have to manage with limited resources to achieve business objectives.

When HR managers were asked to identify their top priority for the coming year, the survey indicated the top four investment areas for 2010 were employee retention and engagement programmes, training and coaching candidate attraction programmes and recruitment and technology investment in HR.

These findings suggest HR departments are anticipating job movements amongst employees as the economic climate improves and are seeking to counteract this by boosting their retention and development strategies.

Tom Marsden, director of professional services at Alexander Mann Solutions said: “Although the restrictions of the recession aren’t over yet, companies are recognising that in 2010, they will need to take steps to retain their workforce.

“The fact that just 20% of HR departments are working with a single recruitment supplier indicates that there is significant room for greater efficiencies in this area, using numerous suppliers on an ad hoc basis makes each hire a significant budget drain as these agencies can be paid as much as 35 per cent of the hire’s salary,” he added.

Playboy Enterprises announced this week it would outsource all business functions except editorial to American Media, in an attempt to cut costs.

American Media will soon handle the production, circulation, advertising sales, marketing and other services of Playboy magazine and the company’s other publications.

Playboy CEO Scott Flanders said in a statement that outsourcing the magazine’s operations would significantly cut costs and lead to profitability in 2011.

"Playboy magazine is a vital part of this company and our brand. We evaluated AMI's outsourcing capabilities on both a quantitative and qualitative basis, and we are confident that this partnership will enable us to continue publishing a magazine that reflects the quality and image of Playboy," Flanders added.

The mens’ magazine has set March 2010 as the latest date to outsource its functions, and will pay American Media a fee for its services.

American Media publishes Star, National Enquirer, Shape, Men's Fitness and other magazines.

Thames Water, the UK's largest water utility company, is expected to offshore its Swindon call centre due to cuts resulting from Ofwat's price review. The Swindon Advertiser has reported that the call centre could be relocated to India.

Ofwat declared a draft decision over the summer to cut household water bills. The regulator wants the typical bill in England and Wales cut by £14 to £330.

Thames Water announced earlier this year that it was considering the option of outsourcing its Kembrey Park call centre, which employs 500 people, to India in a bid to cut costs.

One employee, who asked not to be named commented in the Swindon Advertiser: “Obviously this pricing review means the company would want to save as much money as possible for investment and that could be closing the Swindon branch completely."

The Thames Water spokeswoman revealed to the Swindon Advertiser that “In September we briefed our employees that we are testing the market across a number of areas in the business, in order to be as open as possible. At this stage, we are simply exploring all options."

A new study into voice branding established that 52 per cent of consumers preferred Queen’s English whilst 34 per cent found Scottish accents to be most pleasing to the ear when speaking with someone in a call centre. ‘Scouse’ and ‘Brummie’ accents however were deemed the least appealing according to the study conducted by YouGov.

Following these findings, Nuance Communications has highlighted the importance of voice branding for business sales and customer services within off-shored call centres. Whilst many organisations continue to pursue the strategy of offshoring customer call centres in the belief that it will prove most cost effective, YouGov’s research reveals that around two-thirds of Britons find non-British accents hard to understand.

Ian Turner, Northern European general manager, Nuance Communications explains, “This research highlights a real business opportunity to those savvy enough to realize the importance of voice in portraying a brand in a call centre, businesses cannot afford to let the sound of their brand fall by the wayside as this can impact hugely on the public perception of a business. CEOs must take this factor into consideration if they are to successfully integrate the sense of their brand across their customer facing offerings.”

Hot off the press… Hugh Heffner has joined the outsourcing band wagon and has turned to it in order to cut costs. Outsourcing what, I hear you ask. To many Heffner fan’s dismay, he is not outsourcing his own bunny duties. Instead, Playboy Enterprises is outsourcing all its magazine functions to America Media. Not as exciting as you thought this news piece would be ey?!

American Media will soon handle the production, circulation, advertising sales, marketing and other services of Playboy magazine and the company’s other publications. The mens’ magazine has set March 2010 as the latest date to outsource its functions. The Round Up is certain American Media will continue to produce the publication in the highest ‘quality’.

So while the Playboy Enterprise gets accustomed to the idea of outsourcing the usual suspects have been forming outsourcing agreements all week. The UK’s troubled Royal Mail has signed a cloud computing contract with CSC. The contract is the first cloud computing services agreement of this scale. The contract may work in the mail giant’s favour. The fact that they are working to improve processes may take the media spotlight off of the recent strikes and perhaps reduce budget pressures?

There was also good news for Mitie, a support services and asset management firm, which has posted a rise in profits in the six months leading up to September. The firm is confident in the growth of outsourcing, which is good news all round for the sourcing industry.

What a wide range of outsourcing fun this week. Looks like 2010 is going to be a good one.

Nottingham Trent University has joined forces with IBM to help streamline information on finance, human resources, estate and student records.

The new system from the technology giant will consolidate data from each department into reports and dashboards, allowing the university to make more effective decisions about investment and resources.

The institution took on the new technology in a bid to improve its reporting and analysis capabilities and provide more reliable information.

James Lacey, Director of Finance at Nottingham Trent University commented: “Higher education is a highly competitive environment and universities are large complex organisations facing challenging times in terms of public sector spending cuts.”

“The volume of data we have to process is mind boggling, including applications, enrolments, completion rates and a whole number of other metrics for some 25,000 students. Turning this mass of data into meaningful management information is not a simple task.”

“We will gain a competitive edge by turning the data collected into useful information that we can analyse,” he added.

International mining firm Cliffs Natural Resources has joined hands with Wipro Infocrossing to provide IT infrastructure services in a multi-year deal.

Wipro Infocrossing will provide the mining company with storage and architecture services from its data centres, in addition to delivering desk-top support to Cliffs’ 2,000 employees in North America.

The company hopes the five-year contract will help in further supporting the business in preparation for growth and expansion.

Ron Aderhold, Cliffs Natural Resources chief information officer, said: “We selected Infocrossing as our business partner because of the firm’s commitment to customers’ success and an ability to deliver on its brand promise of superior IT infrastructure services, delivery capabilities, and industry expertise.”

Teleperformance has struck a deal to take on the major shareholding of Improved Financial Solutions (IMFS) in a bid to strengthen its debt collection offering.

The acquisition would give the outsourced contact centre and CRM provider “new service offerings” and “leading technologies” which would help serve customers more efficiently in the current climate, the company said.

Jeff Smith, Teleperformance UK chairman and ceo, said: “We are delighted to announce the acquisition of IMFS, which is a highly professional debt collections agency.”

“Most of the work in this sector is telephone based and we are finding with our expertise and training abilities we are able to create long lasting relationships with customers, who approached in the right way, are fully prepared to work out ways that they can better manage and settle their debts,” he added.

The collection agency, which has over 40 staff handling consumer and commercial debt including credit and store cards as well as loans, has gained up to 95% of its total annual income from consumer debt within the financial services sector.

Over 25,000 people are employed in the UK in debt collection – a figure that could rise further as the effects of the recession continue.

Cardiff City Council has signed a long term partnership with Tata Consultancy Services (TCS) in a bid to help drive the council's mission-critical ‘Strategic Transformational Change Programme’.

TCS will work closely with the Council's ICT Service to help deliver more efficient systems whilst both parties will benefit from an exchange of knowledge and experience.

This strategic partnership is said to pay dividends for the city’s residents by improving the day to day operations and improving service delivery, which is thought to have a total value of £150 million over its 15-year lifetime.

Cardiff Council Leader, Rodney Berman is optimistic about the partnership. He said, the council wants TCS to “bring their global technical expertise and private sector commercial know-how to support a major change to the way in which the council's technology infrastructure supports its day to day operations, this exciting collaboration will help us make savings in our spending on technology and enable the council to raise money through the development of technology-enabled products”.