Industry news

The Defense Information Systems Agency (DISA) and the Defense Information Technology Contracting Organization have appointed Unisys to maintain mission-critical applications for US defense organisations such as the Defense Logistics Agency, the Defense Finance and Accounting Service and the Air Force. DISA’s systems will be maintained from their management centre in Ogden, Utah. The contract is valued at approximately $15 million and will run for five years.

Jim Geiger, managing partner of Department of Defense, Unisys Federal Systems, said, “These support services will assist DISA in providing the secure and reliable IT services essential to the mission of the Department of Defense”.

CSC announced that it has acquired Log.Sec Corporation, a privately owned information technology and logistics engineering firm. Log.Sec will become part of CSC's Defense Division.

James W. Sheaffer, president of CSC's North American public sector divison, said, "The Log.Sec acquisition reinforces our growth strategy of acquiring select companies that complement our three-pronged strategy of growing our core business, investing in high-growth market segments and pursuing select state business."

Financial details were not disclosed.

English Heritage has awarded Atos Origin an outsourcing contract to provide IT support at over 120 of its Heritage sites and offices across the UK from Tintagel Castle in Cornwall to Hadrian's Wall in Northumberland. This new contract renews a contract first signed in 2002.

Under the terms of the agreement, worth £ 7 million over 2 years, Atos Origin will manage desktop, data centre, network, customer support centre, disaster recovery and application support services as well as providing training, maintenance and service management for English Heritage, the UK government organisation responsible for protecting the historic environment in England. This includes historic buildings, monuments, battlefields and archaeological remains.

Anne Ware, vice president for Public Sector at Atos, commented: “Since working with English Heritage we have completed a number of projects including relocation to a new head office in London, desktop and server technical refreshes. Building on this success we will continue to work closely together to ensure service excellence across its entire organisation and to improve their business processes.”

HCL Technologies has completed the acquisition of UK based consulting Axon Group for £441.1 million. In a statement, CEO Vineet Nayar said: “The merger of Axon and HCL SAP practice present a greater opportunity to bring new capabilities to the market with a global delivery model providing full life cycle suite of services.

HCL Axon said that they have revenues of USD 600 million and 4,500 SAP Consultants. The company added that Axon CEO, Steve Cardell, will be the President of HCL Axon.

AstraZeneca, one of the world's leading pharmaceutical companies, has awarded Infosys Technologies a five year, multi-million dollar global sourcing deal including elements of IT and BPO.

Under the agreement, Infosys will deliver end-to-end application maintenance services to AstraZeneca’s global operations in areas such as manufacturing, supply chain, finance, human resources and other corporate functions. The deal is a part of AstraZeneca’s transformation initiative to accelerate innovation and bring products to market faster, and will help improve its operational efficiency significantly.

"We chose Infosys as a strategic partner for its understanding of the rapidly shifting dynamics in the pharmaceutical industry," said Richard Williams, Global CIO at AstraZeneca. "The combination of Infosys’ outsourcing expertise, technology leadership and proven record in rationalizing and standardizing business process were all contributing factors to our decision. We have confidence in Infosys’ ability to deliver a flexible operating model to address our changing business needs more efficiently.

CSC has announced the acquisition of Object Builder Software (OBS), a Bulgarian IT services firm. In a statement, CSC said the acquisition would ‘expand CSC’s global delivery capabilities and complement the company’s network of lower-cost centres in Eastern Europe’.

The addition of OBS expands CSC’s financial services and high technology capabilities in Europe, offering clients a stable workforce with low turnover and competitive hourly rates. Under the terms of the agreement, all OBS employees are expected to transfer to CSC, providing software development and systems integration support to CSC clients in five languages, including English, French, German, Russian and Bulgarian. The majority of OBS employees are located in Sofia, Bulgaria, with the balance in Varna.

“Bulgaria’s reputation as a low-cost Eastern European country strategically positioned to serve both Western and Eastern Europe enables OBS to operate as a nearshore delivery center for CSC’s European clients,” said Mary Jo Morris, president of CSC’s World Sourcing Services organization. “This new Bulgarian centre complements our existing European sourcing capabilities in Spain, Lithuania and the Czech Republic, and adds substantial capability in three key industry sectors: insurance, healthcare and high technology.”

Financial terms of the deal were not disclosed.

The French Air Force has chosen Atos Origin to develop and implement a major personnel management system known as Orchestra. The project entails the design, development and deployment of a single unified SAP HR management system covering all HR and payroll applications for French Air Force military personnel. The four-year contract is valued at €9 million.

As part of a broader inter-ministerial move to revamp France’s public sector human resources information systems, the Orchestra project addresses the Air Force’s HR needs in terms of payroll management, manpower and career planning, consolidation of the restructured human resources function and support for the Air Force transformation process. Its objective is to rationalise, automate and simplify management tasks by the second half of 2009, while ensuring a seamless transition from three standalone applications to a centralised human resources information system, independent of any changes in the Air Force’s organisational structure.

As prime contractor for the project, which involves extensive organisational and functional content, Atos Origin is supporting the French Air Force in its comprehensive quality and resource pooling process. Deliverables cover all phases from development to operational deployment of the system. The systems integration project impacts more than 70,000 Air Force personnel (active and reserve, 2nd section general officers) at 40 air bases and Air Force units stationed in mainland France and French overseas dependencies.

“In addition to complying with the NCI’s functional and technical foundations and seamlessly integrating the Orchestra NCI solution in a global SAP environment, Atos Origin offered us a solution tailored to our project management environment,” said Lieutenant Colonel Roland Cauvin, Deputy Director of the Orchestra project. “This includes a mirror organisation and joint task groups of HR and technical experts. What’s more, the deep integration and collaboration across Atos Origin and Air Force teams is guaranteeing optimal sharing of critical issues and effective knowledge transfer.”

First, apologies for my recent absence from this blog, having been laid low with the festive and traditional pre-Christmas bug.

Barely a month goes by without a security survey, and this month's brace of them comes garlanded with misery for the year ahead – if we believe the results.

Recent surveys by security specialists Lumension and Websense have identified outsourcing and cloud computing as two major security concerns for 2009. The companies say that as the chilly economic climate forces firms to slash costs by cutting specialist staff and moving provision to third parties, data will be at risk both in transit, and in the hands of external organisations.

Of cloud computing (yes, I've given up fighting the term), Lumension says that 61% of its respondents said they were concerned about hosted services providing the opportunity to steal trade secrets and other sensitive IP – while Websense was concerned about the growth of browser-based services (without which it would have no business).

Now, while such surveys give the broadsheet technology supplements something to reproduce unquestioningly, these are the kinds of question that most IT managers would say they're worried about, as they'd look foolish if they said the risks never crossed their minds.

However, most of the security stories we've reported on this site over the past year suggest that the real threats are internal, rooted in staff error (or malice), lax data management, email usage, and the risks of carrying large amounts of data on portable hardware, such as USB sticks, disks or laptops.

Certainly, outsourcing providers have been implicated in a handful of public sector security lapses, but the most serious governmental 'breaches' have been nothing of the kind: in almost every case, they have been down to a woeful lack of management and an apparent lack of commonsense.

There is a world of difference between, on the one hand, storing sensitive information on a memory stick, a CD-Rom, a laptop or even a sheet of paper (that most sustainable, uncrashable and portable technology) and, on the other, entrusting it to a company whose business is hosting and securing your data. The former carries much greater risks than the latter.

So while such surveys are useful and occasionally insightful they are also a form of soft advertising for the companies concerned: a useful PR strategy to get their names and business models in print or pixel – and there's nothing wrong with that.

But it's worth bearing in mind that stoking people's fears about those big bad data stalkers who lurk outside the company gates is usually counter-productive. As we've discovered so often this year, the real villains are you and me.

It's not the man in the black hat or the cyber-terrorists in the basement that put our business at risk, it's the guy in the postroom who wasn't told about policy, the man on the train distracted by a phonecall, the admin assistant with a hole in his pocket, the disgruntled middle manager whose job is being axed, and the senior exec who talks too loudly on the plane (trust me, I've sat next to him).

Unless you're confident that every employee from the chair to the receptionist knows not just how to secure data internally, but also what your legal obligations are, then companies whose business foundation is hosting and securing your data might be a better bet.

Gartner has assessed the suitability of 72 countries as offshore locations, and has announced its ‘Top 30’. The analysis showed that the dynamic nature of the market has seen a number of countries position themselves as credible alternatives to the BRIC countries (Brazil, Russia, India and China).

“Countries such as Mexico, Poland and Vietnam have continued to strengthen their position against leading alternatives, while others have forced their way into the ‘Top 30’. These countries will be seeking to take advantage of the opportunity created by the increased focus that many organisations now have on cost optimisation, as a result of the current economic crisis,” said Ian Marriott, research vice president at Gartner.

During the last 12 months there has been significant activity in many countries to consolidate or grow their positions as leading locations for offshore services. “As a result of this, four countries have dropped out of the ‘Top 30’ and have been replaced by four that were just outside the ‘Top 30’ 12 months ago. This does not mean that the four ‘relegated’ countries have underperformed this year but the dynamic nature of the market has seen others making strong progress,” said Mr Marriott.

The four countries leaving the ‘Top 30’ this year were Northern Ireland, Sri Lanka, Turkey and Uruguay. The new entrants into the 30 leading countries for offshore services were Egypt, Morocco, Panama and Thailand. Strong interest in nearshore locations was a key factor; language skills, cultural compatibility, time zone and travel time were important considerations. As French speaking countries increase their proportion of work conducted offshore, they have been keen to find appropriate French language countries, and saw Morocco ‘step up’. The nearshore benefits of Egypt and Panama, and the cost consideration in Thailand were also important.

In 2008, Gartner’s top 30 locations for offshore services, by region, were:

• Americas: Argentina, Brazil, Canada, Chile, Costa Rica, Mexico and Panama

• Asia/Pacific: Australia, China, India, Malaysia, New Zealand, Pakistan, the Philippines, Singapore, Thailand and Vietnam

• Europe, the Middle East and Africa (EMEA): the Czech Republic, Egypt, Hungary, Ireland, Israel, Morocco, Poland, Romania, Russia, Slovakia, South Africa, Spain and Ukraine

Although only seven countries from the Americas appeared in the final list of 30, these countries are becoming an attractive proposition for the largest buying market for offshore services – the US. Only Canada was rated "excellent" for language (with fluent English and French) but Latin American countries are able to leverage their Spanish-language skills increasingly in the US as more organisations now require Spanish language from their providers for communication with parts of their workforce that speak Spanish as a first language.

The key evaluation criterion of cost was where Canada fared the worst ("fair") compared with "good" or "very good" ratings for all other countries in the region. However, Canada again led the rating for political and economic environment, cultural compatibility, global and legal maturity, and data and intellectual property security and privacy. Argentina was rated less favourably than the rest for its political and economic environment. Brazil and Mexico were considered "very good" for cultural compatibility, and the Latin American countries all managed a solid "good" rating for global and legal maturity. As observed in other regions, data and intellectual property security and privacy remain "work in progress" for many developing countries.

Ten countries from Asia/Pacific were represented in the 30 leading countries. These included the undisputed leader in offshore services — India — and the greatest challenger in terms of potential scale — China. The rest are a mix of mature environments that offer limited cost benefits (such as Australia, New Zealand and Singapore) and emerging countries with a variety of challenges, but attractive costs (such as Malaysia, Pakistan, the Philippines, Thailand, and Vietnam).

The final list of 30 countries included 13 from EMEA and for the first time saw two North African countries enter the leading countries in EMEA. Locations such as Ireland, Israel and South Africa fared well for language skills, because of the quality and quantity of English-language speakers. However, other countries, such as Morocco, Romania, the Czech Republic, Poland and Hungary were also given credit for the availability of alternative languages that address the needs of an increasing number of continental European buyers.

Cultural compatibility was variable, although only one EMEA country (the Ukraine) was rated lower than "good." In recent years, many countries in EMEA have become nearshore centres for traditional service providers and large Indian providers. This is reflected in the global and legal maturity section, where eight of the 13 countries scored between "good" and "excellent." Few countries in this region, with the exception of Russia, have a good selection of local service providers actively selling their capability outside their own country. In the final category of data and intellectual property security and privacy, a mature domestic environment or membership of the EU resulted in the highest ratings.

Gartner also found that external service providers (ESPs) have started to target places outside the ‘Top 30’ to get closer to mature countries, such as the Nordic regions and France that show increased interest in offshore. “Given the current financial turmoil, cost will remain an important factor. However having the right balance between lower cost and higher risks, and lower risks and higher costs will be critical in times of recession and uncertainty,” said Mr Marriott.

Additional information is available in the Gartner report "Gartner's 30 Leading Locations for Offshore Services”.

Tryg, Denmark’s largest insurance company, has taken on CSC for a five-year, US$80 million ITO contract.

Under the terms of the agreement, CSC will provide mainframe, midrange, desktop, Web hosting, print and distributed computing infrastructure services, as well as Tryg’s help-desk and network infrastructure functions. Additionally, CSC will implement a mainframe disaster recovery solution for Tryg.

"Through this agreement with CSC, we will implement improvements in quality, accessibility, stability and speed in our IT systems,” says Managing Director Peter Falkenham, Tryg. “At the same time, we will reduce the operational costs, which will influence our expense ratio favorably. This will help us run an even more profitable business to the benefit of our customers.”

Tryg’s current IT supplier, Nordea-IT, is the IT organisation of Tryg’s former owner, Nordea, a leading Nordic financial institution. Seven IT staff from Tryg and 70 from Nordea-IT are expected to join CSC on December 1, 2003.

Tryg’s and Nordea’s existing business partnership, under which Tryg markets Nordea’s pension products and Nordea markets insurance services on behalf of Tryg, will continue unchanged.

”Tryg’s selection of CSC underscores our strength within IT outsourcing and technology management in the financial services sector,” said George Bell, president of CSC’s European operations. “Application of our world-class IT expertise and experience will result in significant ongoing service and quality improvements for Tryg. We look forward to building upon our relationship with Tryg and the Tryg Vesta Group in the future.”