Archive for June, 2013

U.K. Outsourcing Market Gets More Competitive

June 26th, 2013

British outsourcing customers are getting pickier — and are prepared to not work with a provider or go back in house if things don’t work out.

According to a new study by European outsourcing market tracker Whitelane Research, 13% of organizations are planning to insource (or outsource less), while 20% percent of the 700 existing contracts will not be renewed with the current service provider.


“There are many surprising things about the research,” Jef Loos, Whitelane’s head of sourcing research Europe, told Information Week. Loos was struck, for example, by the fact that almost 50% of all outsourced contracts have been renegotiated in the last couple of years by CIOs. In 80% of cases, he said, the renegotiations delivered cost reductions, better terms and conditions and/or quality improvement.

According to Loos, the feedback shows that U.K. outsourcing customers have become more selective — but also that providers are targeting their customers more closely to avoid costly tender processes that they likely won’t win.

The firm says buyers should also plan for further consolidation in the service provider area, citing Atos’ acquisition of Siemens SIS, North America’s CGI swoop on former U.K. independent Logica and Vodafone’s buyout of Cable & Wireless as examples of a trend that’s likely to continue.

Loos and his team also advise companies to do more “sole sourcing,” or renegotiating and renewing the contract with only the current service provider. This lets customers who are satisfied with their outsourcing contract avoid expensive transitions while suppliers avoid expensive tendering processes. In many cases, Loos says, these savings allows suppliers to offer their customers a discount.

Whitelane’s data may also cast light on another approach to outsourcing: the cloud. “Compared to our studies in other European countries,” Loos said, “we see that the U.K. market is most mature in terms of the usage of cloud computing.”

Loos explained that the first wave of outsourcing’s development was about handing over IT assets, resources and activities between the end user and service provider, the second wave was more business-oriented and involved selective outsourcing, and the third wave was the rise of the ASP (application service provision) model. “Some British outsourcing users consider cloud the fourth wave of the business service,” he said.


Will one supplier oligopoly replace another in Government IT?

June 26th, 2013

The government is determined to end its reliance on the big system integrators selling them huge enterprise systems and hefty support contracts on top. Part of this involves digitisation.

Moving to a digital by default model the government aims to save loads of money.


In its digital strategy published late last year, the Government Digital Service said £1.8bn would be saved per year through government services going digital.

A large part of this will be the introduction of lots of new suppliers through initiatives such as the Government’s CloudStore. This would end the so called IT services oligopoly, with a few very large suppliers dominating government contracts.

One of this oligopoly, Capgemini, is taking steps to ensure that it doesn’t miss out, through the creation of a UK Digital Government Unit to Support.

The supplier says this will help “government and public sector organisations pursue the ‘digital by default’ agenda with maximum speed and efficiency and minimum risk.”

It is offering the infamous “one stop shop” for departments running digital transformation projects.

Digitising and opening up to more suppliers will be challenging for government departments. Procurement and supplier management will be difficult. Companies like Capgemini will offer management skills as well as technical skills.

But is there a danger that the big suppliers will end up dominating and isn’t it vital that the suppliers of particular services (towers) are kept clear of service integration?

Or is it a good thing that the suppliers are changing to support the government?


iGate Gets 5-Year $100 Million Outsourcing Order from US MetLife

June 26th, 2013

Outsourcing services company iGate Corp. ( IGTE ) Tuesday said it has received a five-year contract worth more than $100 million to offer information technology infrastructure solutions to U.S. life insurer MetLife Inc. ( MET ).

As part of the deal, iGate said in a statement, it will manage the IT systems of the U.S. company and provide applications support and enterprise network services. iGate is U.S.-based and listed on the Nasdaq Stock Market, employing 28,000 people, mainly in India.


Some parts of the contract were previously managed by a major U.S. IT services company and one of the top Indian outsourcing companies, Sanjay Tugnait, executive vice president and head of sales for North America at iGate, told the Wall Street Journal.

iGate, which already has a 10-year outsourcing partnership with MetLife, said the deal will be based on a business model where the company charges the client using an outcome-based pricing approach.

iGate has been aggressively pushing this pricing model over the last couple of years to woo customers away from traditional models of pricing that are based on the number of hours an employee puts in or charging a fee per transaction processed.

The deal comes as iGate rides through a tough phase. Last month the company fired its chief executive, Phaneesh Murthy, for allegedly failing to report a relationship with a subordinate employee.

The company has in the interim appointed a former senior executive with a unit of Intel Corp. as its CEO and president. Its board is currently searching for a permanent CEO and president.


Delegating Responsibilities As A Small Business Owner: 5 Tasks To Take Off Your Plate Right Now

June 26th, 2013

Leading a small business requires wearing many hats; CEO, CFO, bookkeeper and the first point of contact for customer care. You spend so much time overseeing each detail of your business, that sometimes it can feel like you don’t have the chance to step back and focus on actually growing it.

To help with this, participants in the Goldman Sachs 10,000 Small Businessesprogram are encouraged to create and implement their business vision—something that requires leadership and strong communication. One of the keys to achieving this leadership vision is delegating some of your responsibilities. This allows you to spend time on bigger ideas, like strategic growth. Below are five tasks you should consider delegating or outsourcing to others.


1. Social Media
While you should still be overseeing the larger message you are putting out through your social media accounts, delegating the actual publishing of tweets or blogs takes something off your to-do list. To save even more time, task the same person with writing your posts and managing publication calendars.

2. IT Support
Updating and maintaining software systems usually requires a significant time investment. Delegate this task to an office manager or employee comfortable with computer systems. If you don’t have anyone in your business able to take this on, consider outsourcing IT support to a third party.

3. Book Keeping
Cash flow is the lifeblood of your business, and knowing the day-to-day numbers of what’s due in and what’s to be paid will always be important. However, invoicing, bookkeeping and other necessary administrative finance tasks could be passed onto an office manager or outsourced. But remember, if you do outsource, schedule regular check-ins to review accounts receivable/payable and ask if there is an online system you can use for instant access.

4. Customer Service
Once customer service guidelines are in place, there is no reason for you to serve as first point of contact for every customer query or concern. Instead, task an employee with strong personal skills to respond to customers or answer the phone.

5. Production or Labor
A great problem to have is more business than you can handle. If your resources are already stretched thin and you are offered new business, you risk sub-quality work or over-burdening your employees if you take on too much. In this scenario, consider subcontracting out production or labor to another business or vendor. You can then continue to build your business without having to turn down potential new customers. If you are considering this, make sure you have everything in writing about what is expected and work with your tax and legal professional to ensure you are remaining compliant.


Navy Fires Head Of Naval Enterprise Networks

June 26th, 2013

The lead officer in charge of the Navy’s enterprise IT networks was relieved of his responsibilities on Monday, just days before the Navy is due to announce a major contract award for its Next Generation Enterprise Network (NGEN) program.

Capt. Shawn Hendricks, the program manager for the fleet’s naval enterprise networks program, was dismissed “due to a loss of confidence in his ability to lead,” said Victor Gavin, the Navy’s program executive officer for enterprise information systems.


The decision followed an investigation by the Space and Naval Warfare Systems Command (SPAWAR) which concluded Hendricks had been involved in “an improper relationship and unprofessional behavior,” according to a Navy news release. The relationship was with a subordinate contractor and was personal in nature, a Navy official told the Navy Times. Hendricks will be reassigned to SPAWAR’s Washington Liaison Office while his case is processed.

Hendricks’ dismissal is not expected to impact the Navy’s plans to announce a long-awaited decision, due on or before June 30, on who will carry out the Navy’s next generation of IT transport and enterprise services, according to Edward Austin, PEO-EIS public affairs officer.

The Naval Enterprise Networks Program Office manages a portfolio of programs, including the Navy Marine Corps Intranet (NMCI), the OCONUS Navy Enterprise Network (ONE-Net) and the Next Generation Enterprise Network (NGEN) contracting vehicle.

But the timing of the dismissal comes at an awkward moment as the Navy prepares to announce the outcome of its award decision. The planned announcement comes after repeated delays for modernizing a system that is regarded as one of the world’s largest enterprise networks, which has been derided for years by the sailors who rely on it.

At one point, NMCI connected more than 800,000 users utilizing 384,000 workstations at more than 3,000 shore-based locations throughout the United States, Hawaii and Japan, according to Navy figures. It was originally regarded as the ultimate IT outsourcing project when the Navy commissioned it more than a decade ago.

Since then, however, the network’s cumbersome performance and outmoded applications have made NMCI an albatross for the Navy, as has the Navy’s entangled relationship with Hewlett-Packard, which owns and manages the network. Keeping the system operating until a replacement could be developed has cost the Navy billions of dollars.

The Navy expects the next generation system to be managed much differently. In addition to being government-owned, Navy officials say that periodic competition for the network’s services is expected over time to drive down costs and make it easier to incorporate new technological innovations, including evolving solutions to defend against cyber threats.


Healthcare IT Services Firm to Offer Courion-Based Solution to Hundreds of U.S. Hospitals and Health Systems

June 26th, 2013

Courion, the leading defender against enterprise information access threats, today announced that CareTech Solutions, an IT services provider for more than 200 U.S. hospitals and health systems, will offer Courion’s PasswordCourier(R) password management and AccountCourier(R) user provisioning solutions as value-added packaged services for its help desk clients.

CareTech is one of the nation’s premier information technology services providers to the healthcare industry. The 1,200-employee, $160 million company is ranked “Best in KLAS, Partial IT Outsourcing” for its help desk. Called Service Desk, it offers hospitals trained analysts 24/7/365 to assist with end-user issues related to clinical and business information technology systems.


Courion solutions address several key challenges for healthcare organizations:

   -- Healthcare facilities are environments of controlled chaos where
      ever-changing staffs access a wide array of critical applications
      processing priceless medical information. Doctors, nurses, clinical
      personnel, administrative personnel and a wide range of healthcare
      professionals wreak havoc with facilities' attempts to control access to
      applications and information.

   -- Rising healthcare costs are a major challenge of our times, and
      streamlining identity and access management (IAM) keeps one area of
      healthcare spending under control.

   -- Healthcare professionals have one job above all others: keeping people
      healthy. They have no time to waste with anything less than seamless
      on-boarding or password management.

   -- Patient privacy is paramount as evidenced by the Health Insurance
      Portability and Accountability Act (HIPAA). State-of-the-art IAM is a key
      component of protecting that privacy.

“Hospitals operate with very lean IT departments that are responsible for managing extremely complex environments,” said CareTech’s President and CEO, Jim Giordano. “Reducing the volume of non-critical help desk calls related to password resets or system access and credential questions will be a major benefit for our customers who need to get their staff and clinicians back to work fast. These new services will help us quickly and easily deliver these benefits.”

How Courion solutions work

Courion’s PasswordCourier consistently enforces strong password policies and enables users to instantly and securely reset their own passwords for enterprise systems, applications and Web portals. Transparent synchronization lets employees use one password to access multiple systems, and employees can serve themselves through the Web, desktop PC, voice authentication, IVR or support staff.

AccountCourier enables enterprises to fully automate new hire, promotion/transfer and termination processes. With connectivity to multiple authoritative sources, AccountCourier’s automated provisioning will offload from hospital staff the time-consuming burden of manually granting and revoking access to critical systems, including electronic medical records (EMRs) applications.

“Our relationship with CareTech Solutions is a prime example of the power of our partner relationships,” said Mike Parise, Courion vice president of global alliances. “CareTech’s team consists of healthcare technology experts who need to give their clients peace of mind that their processes are efficient and their information secure. CareTech’s standing in the healthcare industry, and their commitment to providing the best solutions in their sector, make for a great partnership.”

PasswordCourier and AccountCourier are key components of Courion’s Access Risk Management Suite, a comprehensive solution that identifies, quantifies and manages threats of improper access to enterprise computing systems. Courion’s software easily integrates with electronic medical record systems like Epic and Cerner as well as all major operating systems and applications such as Microsoft Exchange, PeopleSoft, SAP, and Equifax.


Indian IT firm Tech Mahindra completes Satyam takeover

June 26th, 2013

Indian IT outsourcer Tech Mahindra on Tuesday completed a takeover of its partly-owned unit Mahindra Satyam, creating a new force in the sector with annual revenues of $2.7 billion.

The new entity will retain the name Tech Mahindra — with a new logo — and be amongst India’s top five locally-listed IT outsourcers with 540 clients, a Tech Mahindra statement said.


Tech Mahindra bought a 42.7 percent stake in Hyderabad-based Satyam in April 2009 when it was on the verge of collapse following an accounting scandal.

The company has since operated under the name Mahindra Satyam and has emerged from the crisis profitable, posting a net profit of 9.01 billion rupees ($152 million) for the last financial year ended March 2013.

The two companies approved a full merger in March 2012.

The takeover of the remaining stake involves an exchange of stocks, with Satyam shareholders receiving one Tech Mahindra share for every 8.5 Satyam shares.

“Today we have fulfilled the commitment made in 2009, when we acquired Satyam, to jointly become one of the largest diversified players,” said a statement from Anand Mahindra, chairman of parent group Mahindra and Mahindra.

The merger comes as many of India’s IT outsourcing firms are going through a rough patch, with the outlook for the industry difficult due to uncertainty in key US and European markets.

Satyam stunned corporate India in 2009 when its founder B. Ramalinga Raju admitted he had for years overstated profits and inflated the firm’s balance sheet by more than $1 billion.

The scandal nearly pushed Satyam into bankruptcy as clients and staff exited, but Tech Mahindra, part of Indian auto and farm equipment manufacturer Mahindra and Mahindra, came to the rescue.

Raju, once a star of India’s software boom, is awaiting trial for conspiracy, cheating and forgery.


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