Industry news

Convergys Corporation, a global leader in relationship management, announced today that it has signed a new five-year license agreement and support and maintenance contract with BT for Infinys’ Rating and Billing Manager. Convergys will support BT’s major business divisions including BT Retail, BT Wholesale, and BT Global Services.

A team of Convergys’ expert technical consultants will work alongside BT staff to assist with and consult on an array of activities including hardware configuration and performance, software architecture, and day-to-day change requests.

“Convergys’ flexible partnership approach enabled us to find the billing solution that will help BT drive cost efficiencies for the benefit of our customers,” said Clive Selley, MD, Global Platforms, BT Design. “Infinys provides BT with billing accuracy which directly supports BT’s company-wide ‘right first time’ approach to delivering customer service. Infinys also provides us with the ability to take a holistic view of customer billing activity so we can better understand our customers’ needs and exceed their expectations.”

“Infinys Rating and Billing’s unsurpassed, customer-centric capabilities strongly support BT’s business requirements from both a financial and technological point of view,” said Riki Allon, Senior Vice President and General Manager for Convergys in EMEA. “In a very competitive market, Infinys gives BT the tools it needs to positively drive and enhance the customer experience across all of its business divisions.”

Fujitsu Services, one of Europe's biggest IT services companies, has secured a contract renewal with ATOC, the Association of Train Operating Companies, to continue running and maintaining RJIS – the Rail Journey Information Service.

RJIS provides the timetables, fares, route planning, ticketing and transaction services needed to buy rail tickets and complete travel enquiry requests.

This five year, £13 million deal, will see Fujitsu refresh and update the hardware and applications technology used by RJIS.

Steve Howes, managing director of Rail Settlement Plan (RSP) for ATOC, commented, "This renewal reflects the ongoing commitment from both parties to this long–running and successful project.”

Nick Chisnall, head of rail business Fujitsu Services, said, "We are pleased to see this partnership continue to 2013."

Capgemini, provider of consulting, technology and outsourcing services, has now acquired Getronics PinkRoccade Business Application Services BV (BAS B.V.) from Getronics Nederland N.V.

The acquisition, announced in July 2008, was closed yesterday.

Peter Barbier, Director of Capgemini Nederland N.V. has been appointed to lead the integration of BAS B.V. into the Dutch Capgemini organisation.

Henk Broeders, member of the executive committee of Capgemini, commented, "This acquisition is an ideal strategic fit with our activities in the Netherlands.

Engbert Verkoren, CEO of BAS B.V., who will now lead Capgemini BAS, commented, "By joining Capgemini, we benefit from the unparalleled experience of a European global IT company that is already successful in the Dutch market.”

The rise of software as a service (SaaS) companies, such as Salesforce.com, RightNow, NetSuite and SugarCRM has been much hyped over the past two years, and has led people to believe that SaaS is merely a low-cost, fashionable extension of CRM. Of little interest to the outsourcing market, you might think.

Much of the hype comes from such people as Salesforce.com CEO Marc Benioff, whose annual 'Dreamforce' conference in San Francisco attracts thousands of delegates with an almost rock-concert-like buzz.

Indeed, speakers at last month's event included Neil Young, with evening entertainment provided by the Foo Fighters – a surreal moment, considering the highlight of most UK jamborees might be an Abba tribute act.

Other speakers have included such 'outliers' and original thinkers as Malcolm Gladwell, Google.org's Larry Brilliant, Peter Gabriel, and, last year, a confused-sounding George Lucas. The Force was not quite with him, as I recall.

(Lucas's educational foundation Edutopia uses Salesforce technology, and I did put up my hand to ask him if he considered calling it 'Wookiepedia'. Mercifully, the mic was not handed out at that session.)

All this might persuade the naysayers that SaaS is another big tail wagging a small dog: lots of overvalued, overhyped companies promising to change the world on the back of an over-inflated stock price and the last dregs of the 60s dream. After all, we've been there before: the IT industry had its own localised recession as a result.

But you can tell a lot about the viability of a market by the enemies it makes, and the friends who set up shop in the exhibition hall. At present, those enemies include SAP and Oracle – Larry Ellison is an investor in both NetSuite and Salesforce.com, but anecdotally is “terrified” of the latter. (Unlikely, I think, but an amusing prospect.)

Friends of SaaS include IBM, Accenture and Capgemini, on the one hand, and Facebook and Google on the other: these companies are not even opposite sides of the same coin; they're not even in the same pocket.

But why even mention Facebook and what does this have to do with outsourcing?

Well, the mistake many people make is in assuming that Facebook and its ilk are just amusing ways for employees to waste your money sharing their hangovers with the world.

All social networking sites are now powerful computing platforms that millions of people choose to use, and which thousands of developers write applications for. They are intuitive and easy, and companies such as Salesforce.com and NetSuite want to be 'the Facebook for business'.

Ridiculous? Not at all: Facebook has partnered with Benioff's company, with the intention of using both platforms to deploy business applications.

This century, IT has become integrated into our lives to a degree that seemed impossible even a decade ago. That means there is a groundswell of opinion against any technology that is heavy-handed, expensive, corporate, difficult to use, and which you have to rebuild the enterprise around – or write consultancy cheques to understand.

The eminence grise (or rather, blanc) behind all this is, of course, Google: that once-innocuous white page that many of us called home, and which now hides a vast network of applications and services.

IBM, Accenture and Capgemini now have SaaS practices, presumably with the intention of building lucrative consultancy services around baffling wealthy executives. Even the receptionist understands 'Facebook for business', but CEOs will reach for their chequebooks to have 'cloud computing' explained to them by a man in a big blue suit. At least, that's the theory.

The fact is that SaaS is a threat to traditional outsourcing, particularly in such mainstream BPO areas such as HR. Ridiculous? No: the fastest growing software company in the world is HR SaaS provider SuccessFactors, and it is built on the promise of disintermediating your business.

The proof of all this is found in a recent announcement by that über old-school enterprise provider SAP. About a year ago SAP accidentally validated the SaaS market by announcing it was entering it. Last week the company effectively announced that it couldn't afford to play in the market because the margins were too slim.

Exactly; but others certainly can, and that is why you should watch your backs.

E-Plus Group, Germany's third-largest mobile telecommunications provider, has extended its IT outsourcing agreement with Atos Origin for a further five years.

According to an Atos Origin statement, the companies ‘decided together to move from a ‘classic’ IT-Outsourcing to a ‘Flexible IT’ contract to further strengthen the customer-supplier relationship and to enable the E-Plus Group to respond faster to changing business needs.’

The new ‘Flexible IT’ contract will see Atos Origin take over the end-to-end responsibility for 21 business processes from Retail Postpaid Order Management through to Retail Postpaid Billing and Interconnect Billing. Atos will be paid for the services that it delivers rather than a cost agreed upfront. For example, in the case of retail postpaid order management, Atos Origin’s fees are based on the number of new E-Plus postpaid contracts.

"Many companies talk about flexible IT; we are implementing it“, says Thomas Weber, IT Director of E-Plus. "Under the new contract, IT will provide a real contribution to business results and the E-Plus Group can continue to concentrate on its core competence, for example its successful brands and the individual customer support".

Blackstone, a large US private equity firm has acquired a majority stake in the IT outsourcing arm of India's CMS Computers.

According to a statement, the new division offers ‘IT infrastructure management and outsourced business services’. The division will serve various industry verticals, including card processing, transaction printing and ATM management for the domestic Indian banking sector.

Rajiv Kaul, ex-CEO of Microsoft India has been appointed as executive vice chairman and CEO of the new company.

Virgin Atlantic Airways has signed a new IT services agreement with EDS, extending an existing 25-year relationship between the companies.

The new agreement will last an initial five years during which EDS will provide Virgin with the next generation of its airline reservations solution, EDS Reservation Services. The system will be hosted and maintained on behalf of the airline. New features to be included are Electronic Miscellaneous Documents (EMD), which allow Virgin Atlantic employees to electronically capture and account for ancillary sales, and Ticket Re-issue and Refund (TRR) software that automates a formerly labor-intensive function and improves customer service.

“We are impressed with EDS' vision for their new reservations platform and how this will enable Virgin Atlantic to exploit a service-oriented architecture (SOA) to provide improved customer services, greater agility and lower costs,” said Mike Cope, IT director at Virgin Atlantic. “This builds on our long-standing partnership with EDS during which time Virgin Atlantic has grown to become Britain's second-largest airline serving the world's major cities.”

Also new to the agreement, EDS will use its airline service-oriented architecture (AirlineSOA) that connects software and systems to better integrate Virgin Atlantic's operations and help meet the airline's unique market needs. Each of these new functionalities helps Virgin Atlantic lower core reservations services costs and add new revenue opportunities.

Banking giant HSBC is axing around 500 UK jobs - including IT positions - following a review of the "current economic conditions".

The bank plans to cut jobs from managerial positions, through to IT, support services, administration, and sales and service staff. The cuts represent less than one per cent of HSBC's 58,000 UK staff.

Paul Thurston, managing director, HSBC UK, eplained: "In the past two months we have looked hard at our business, focussing on removing duplication, managing costs and devoting resources to areas that offer the most potential for growth."

"We deeply regret taking this step, but we consider it essential to ensure our business is operating as efficiently as possible and that we are best placed to deal with the economic downturn and maintain our levels of customer service," he adds.

Swiss bank, Zuger Kantonalbank, has extended its IT services contract with CSC for another seven years. The extended deal is valued at US $33 million

Under the agreement, CSC will continue to provide SAP-based applications services, including development, maintenance and support. Specifically, CSC will continue its 24x7 operation and management of Zuger’s SAP banking platform and add new functionality that enhances system efficiency and increases ease of use.

“With CSC’s support, we can continue to lower operating costs while increasing customer service,” commented Beat Mathys, a Zuger Kantonalbank Management Executive. “This will enable us to further increase efficiency and improve our cost-income-ratio in the highly competitive retail banking market.”

Computer Sciences Corporation (CSC) has signed an ITO agreement with Marconi Corporation plc, a global telecommunications equipment, services and solutions company. The contract is valued at £450 million over 10 years.

Under the terms of the agreement, CSC will support and manage Marconi’s IT help desk, desktop computing, networking and midrange operations; develop and maintain software applications; and provide telecommunications services. The agreement encompasses Marconi IT operations worldwide, with the exception of its Asia Pacific and Middle East regions and the company’s UK-based Interactive Systems business.

Upon compliance with local legislative and consultative requirements, approximately 360 Marconi IT employees across Europe, Africa and the Americas will transfer to CSC in June 2003.

British Telecommunications (BT), a subcontractor to CSC through this agreement, will provide networking services, including local and wide area networking, voice and conferencing services, and global remote access facilities. An additional 40 Marconi IT employees, principally from North America and the United Kingdom, will transition to BT in June 2003.

“This agreement will contribute significantly to our committed cost reduction and efficiency program and allows us to focus on our core business, which is building, maintaining and supporting the networks of the world’s leading telecommunications companies,” said Mike Donovan, Marconi’s chief operating officer. “The Marconi employees transferring to CSC or BT are moving to organizations where IT and telecoms services are their core business. This will give them new and extensive career opportunities and increased exposure to leading-edge practices in IT systems deployment and support.”