Industry news

Friends Provident will transfer 200 staff to IBM and its partners as part of a 10-year IT and infrastructure outsourcing deal.

The life and pension firm expects the move will generate initial cost savings of £6 million a year as it looks for group savings of £40 million by the end of 2009. In January, Friends announced plans for 600 job losses.

Trevor Matthews, CEO of Friends Provident, said, "I am delighted to be entering into this contract with IBM at this very important time in the rebuilding program for Friends Provident. This is a big step forward in achieving our targeted £40 million of annual cost savings by the end of 2009. The cost savings we will realize under this contract will help to make Friends Provident a leaner, fitter and more efficient business without compromising the market leading levels of service we are renowned for. By partnering with IBM, one of the world's leading technology providers, we will gain access to the latest processing power and the expertise to improve our service and technology further. It sets us up very well for the future and is further evidence of the forward progress we are making."

Sterling Commerce, an AT&T Inc company, and Infosys Technologies Ltd have announced an expansion of their global alliance to target customers in the financial services and retail industries. Through the deal, the companies will seek to drive efficiencies and business results for clients through collaboration between business communities, processes, people and technology.

The new global partnership expands a relationship between the two companies that has existed for more than a decade. Sterling Commerce and Infosys have transformed its customers’ business processes in order to improve flexibility and effectiveness. Infosys’ large-scale implementation expertise and world-class global delivery capabilities have led to highly successful Sterling Commerce solution implementations. Sterling Commerce provides solutions for enterprise integration, multi-enterprise integration, payments management, selling, and fulfillment that help companies achieve higher levels of performance by optimizing their business communities, processes, and technologies.

Steria has appointed Olivier Vallet as CEO of Steria France. Vallet will work to speed up the process of bringing Steria France into line with the Group's overall performance objectives and providing Steria's customers with a high level of added value and quality.

Olivier Vallet, a member of the Steria Group's Executive Committee, joined the company in 2006 as Director of Industrial Operations. He has contributed to the development of a global industrial production model offering offshore and nearshore capacities in Poland, India and Morocco. In addition, he has served as CEO of the Spain and Scandinavia entities for the past year.

From 2000 to 2006, Olivier Vallet occupied a number of different positions at the Alcatel group and in 2003 was appointed Chairman and CEO of Alcanet, a wholly-owned subsidiary of the Alcatel Group. He also managed Alcatel's IT and telecommunications activities.Prior to joining Alcatel, he held the position of Vice President in charge of Finance and Outsourcing with the NCR group from 1999 to 2000.

Olivier Vallet has also chaired the European Outsourcing Association in France. The goal of this association is to evaluate the consequences of outsourcing (managed services, BPO) on the industrial, legal, managerial and human aspects of a company. The EOA is open to all market players, users, and consulting and IT service providers.

BancTec, a global provider document and payment processing services, has reached an agreement to assume all of the contracts and employees of BPO services provider Document@Work. The agreement will enable BancTec to grow its global BPO operations and provide the company with an expanded customer base in France.

Document@Work is a provider of data capture services. Created in 2004, the company is recognized for its BPO expertise, which it provides for such clients as DHL and Disney.

"This transaction further enhances our BPO presence in Europe and strengthens our position as a key provider of document processing services," said Pascal Wirth, President-Directeur General, BancTec SA. "We look forward to providing Document@Work's customers the same outstanding services to which they are accustomed, as well as to growing our customer base throughout France."

BancTec France recently opened a new office and BPO facility in Noisel to begin servicing most of Document@Work's existing contracts.

Over the past year, BancTec's global BPO practice has grown to include 8 processing centres in North America and 13 in Europe. Services provided include loan origination processing, mail processing, payment processing, document and voucher processing, hosted archive, healthcare revenue cycle management, accounts payable processing, invoice processing and complaints handling.

Cognizant, a provider of global consulting, technology and business process services, has announced that it has authorised a share repurchase program of up to US$50 million of the Company’s common stock over the next 12 months.

Repurchases under the program may be made through open market purchases or privately negotiated transactions in accordance with applicable US federal securities laws. The program will be funded using the company’s cash on hand and cash generated from operations.

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".