Posts Tagged ‘BPO’

Six more to be sacked at Infosys BPO for inflated invoices as probe reveals company overcharged Apple

November 20th, 2014

Infosys, which announced the firing of the finance chief of its back-office arm on Tuesday, is set to sack more employees at the unit to underline its intolerance for financial impropriety as it emerged that the episode which has put an unflattering spotlight on the firm involved one of its marquee clients, Apple. Sources familiar with the company’s thinking said at least six employees at one of Infosys BPO’s European subsidiaries will be asked to leave soon after internal investigations revealed that they had produced inflated invoices and purportedly overbilled Apple for many months.Outsourcing5

The sources insisted the amount involved was “financially insignificant”, but the company was taking harsh action nevertheless to make an example of the case that has become an unwelcome distraction for new CEO Vishal Sikka as he seeks to recapture the IT bellwether status for Infosys. On Tuesday, Infosys announced that the chief finance officer of Infosys BPO, Abraham Mathews, had been fired “for not complying with its code of conduct”. The unit’s CEO, Gautam Thakkar, also said he would quit, taking moral responsibility. “We have always adhered to the highest corporate governance standards,” said a senior executive at Infosys.

“In the particular case, although it was a financially insignificant amount, the CFO should have reported the incident. For reasons best known to him, he did not and so we were left with no option,” the Infosys executive said. Infosys declined comment on the identity of the client at the centre of the case or elaborate the reasons for its punitive actions.

A company spokeswoman said on Wednesday: “The financial irregularities are not material in nature and the company has already made required disclosures. The company has taken disciplinary action on employees. We will not be able to comment on client-specific matters or on investigation as they are confidential in nature.”

An email sent to Apple remained unanswered. Meanwhile, details emerged that Infosys first unearthed the case of financial impropriety in September, following which it set up a panel to investigate it.

One source familiar with the investigation said that in this particular case, a small team of executives appeared to have made inflated invoices for the support provided by Infosys BPO, although these inflated invoices may not have been sent to Apple. After a month-long investigation, on Tuesday, the company said it was terminating the services of Mathews while Thakkar, who is one of the 13 executive vice-presidents at Infosys, will leave the company at the end of the month.

Infosys has already announced their replacements, appointing company veteran and senior vicepresident Anup Uppadhayay as the unit’s CEO and Deepak Bhalla as the new chief financial officer. While the episode could bolster the country’s second-largest software exporter’s long-held reputation for adhering to the highest corporate governance standards, some experts believe this episode could make it vulnerable to some collateral damage, particularly if Cupertino-based Apple, the maker of iPads and iPhones, were to reconsider its decision to engage with the back-office support provided by Infosys BPO.

“Apple for long has been debating on engaging with Indian outsourcers and this incident will certainly not go down well,” said Pradeep Mukherji, president of Avasant, a Mumbai-based management consultant that helps companies choose outsourcing firms. “Apple may even want to reconsider its engagement with Infosys BPO.”

Nonetheless, Mukherji said the proactive steps taken by the company, including the change in leadership at its back-office division, should help the company limit any further damage.

“Organisations like Infosys have an effective mitigation strategy in place to contain the damage and not let it go out of control. So I don’t see why other clients will be worried.” Anil K Gupta, professor of global strategy and entrepreneurship at the Smith School of Business, The University of Maryland, said Vishal Sikka had done the right thing by cracking down hard.

“If you excuse one instance of fraud, especially at the senior executive level, then you’re going down a slippery slope. He had to act and he did the right thing. It also helps boost his credibility both internally and externally,” he said. While the episode and the attention it has generated could, according to some, leave employees and other clients anxious, Infosys officials maintain this is just an isolated case and there was no reason for its other clients need to be “jumpy”.


BPOs leaving Metro Manila

November 19th, 2014

The Philippine business process outsourcing (BPO) industry was set to challenge China as the world’s biggest BPO employer, but the work force could not supply the demand for skilled workers, Budget Secretary Florencio Abad said. Outsourcing5

He said vacancies in calls centers, back office and customer-related services has been growing every year and some BPO companies have started moving out to major cities outside of Metro Manila where skilled workers were available.

“Some BPO companies are exploring ‘second wave’ cities such as Cagayan de Oro, Butuan and Bacolod where they could recruit personnel,” Abad said.

From about 2,400 workers in 2001, the BPO industry now employs an estimated 200,000 in 120 companies. The Philippines has overtaken Malaysia and India and is set to challenge Chinas the world’s biggest BPO employer.

The Philippines earned $11 billion and employed 900,000 people in 2010. Industry experts estimate the gross revenue to $25 billion by 2016.

Abad said some BPO companies have entered into partnerships with state universities and colleges to train students on particular skills to become call center agents.

He said the government has also considered recalling Filipinos working abroad and provide them with skills on animation, medical transcription and web design to close the gap between supply and demand.

“The government is heavily investing in upgrading technical-vocational centers in order to be able to train potential BPO workers,” Abad said.

Mayor Mauricio Domogan said Baguio City, which was one of the “first wave” cities in the march of BPO companies to the countryside, has benefited from its being an educational center in northern Luzon.

He said from two call centers in 2010, the city now has eight BPO catering to various clients in different parts of the world.

“The operation of call centers in the different parts of the city helped increase the economic activities at night and attracted skilled workers from different parts of the country,” Domogan said.

Records at the public employment and services office show the number of BPO workers have increased from 2,000 in 2010 to nearly 10,000 this year with starting salaries ranging from P20,000 to P25,000 a month.


NelsonHall’s latest Market Analysis of the P&C BPO in the Automotive Sector released

November 19th, 2014

NelsonHall, the leading independent BPO and IT outsourcing analyst firm, today announced the availability of its latest research entitled “Targeting P&C BPO in the Automotive Sector” authored by Fiona Cox, Insurance Outsourcing research analyst at NelsonHall.Outsourcing1

This report provides a comprehensive assessment of automotive insurance BPO services globally in terms of spending patterns, service offerings available in the market, client demand for automotive insurance BPO, delivery locations and next-generation offerings.

Cox commented: “Long standing issues of high customer expectations and competitive pricing remain, but now with the added pressure from comparison websites; as a result, the motivations for automotive insurance BPO in 2014 are starting to go beyond basic cost-take out and process improvement, the need now is for claims transformation which accounts for over 40% of customer requirements in 2014”.

The majority of vendors provide full scope of P&C BPO services for all lines of business, including automotive, rather than services designed for auto specifically; services less frequently provided (and more commonly offered by specialists) tend to include support of vehicle repair networks (VRN) such as body shops and assessment services; likewise, most enabling technology is still in support of wider P&C business, rather than auto P&C BPO specifically; to have technology in support of auto insurance specifically requires an auto focus, which many providers do not have.

Increasing application of analytics to strengthen customer relationships and to align price to performance through telematics will continue through 2018 with many suppliers acquiring in support of analytics tools and software. Cox says, “Through use of this level of consumer analytics, covering both lifestyle and driving patterns, there will no longer be a need to make estimates on how to price insurance policies or to guess which products might suit the needs of individuals, based on mass analysis.”

Going forward, auto P&C BPO will continue to make up the largest proportion of the wider P&C BPO market since it has more scope to be outsourced than other lines of P&C, largely due to the level of customer interaction and potential to tailor products. In order to be successful, vendors will be expected to deliver cost savings of at least 30% by offshoring elements of the process and increasingly through automation. Additionally, the ability to operate VRN’s will be a distinct differentiator in the market.

This report is available to subscribers here. Non-subscribers can access a report abstract here and can contact Lindsey Ball to purchase the report.


Infosys’ outsourcing unit CFO sacked; chief quits

November 19th, 2014

Infosys on Tuesday announced the termination of the services of Abraham Mathews, chief financial officer (CFO) of its business process outsourcing (BPO) subsidiary, for non-compliance with the model code of conduct. The company also said Gautam Thakkar, chief executive officer of Infosys BPO, had quit, taking moral responsibility for the incident.Outsourcing

While Infosys did not elaborate on the said violation, sources close to the development said Mathews had failed to bring to the company’s notice financial irregularities at one of its BPO centres. They added Mathews wasn’t directly involved in the irregularities, but had failed to report the incident.

The company is learnt to have dismissed the executive directly involved with the irregularities, termed “immaterial”.

“The board of Infosys BPO Ltd announced the separation of Abraham Mathews, its chief financial officer, from the services of the company for not complying with its code of conduct. The departure is in keeping with the company’s goal of setting the highest standards of corporate governance and adhering to the letter and spirit of the code of conduct,” the company said in a late night BSE filing.

Mathews had taken charge as CFO of Infosys BPO in December 2003.

The company has announced the appointment of Anup Uppadhayay, senior vice-president, global head of delivery for financial services and an Infosys veteran of 21 years, as Infosys BPO Ltd’s new chief executive and managing director, and Deepak Bhalla, associate vice-president and head of its corporate accounting group, as the new CFO.

Bhalla had joined the company in 1998.

“BPO is of fundamental and strategic importance to our company. Our endeavour is to transform BPO with process innovation, automation and artificial intelligence to deliver exceptional efficiency and business value to our clients,” Vishal Sikka, managing director and chief executive of Infosys, said.

For 2013-14, Infosys BPO had reported revenue of Rs 3,278 crore and a net profit of Rs 578 crore.


Nasscom, BPO companies like Genpact, Dell, Cognizant and others to visit campuses to create awareness

November 17th, 2014

The business process outsourcing (BPO) industry, which until a few years ago had thousands of youngsters joining it, is not so cool anymore, thanks to more glamorous competitors such as startups and IT firms with high-end profiles. The National Association for Software & Services Companies, along with 11 BPO companies, now plans to confront this unpopularity head-on — college by college. The 11 firms partnering Nasscom include WNS, Genpact, Dell BPO, EXL and Cognizant BPO.Outsourcing36

In December-January, company heads, learning and development leaders and marketing heads from the BPO sector will visit 24 colleges to explain the industry’s need for data analysts, automation experts and specialists for high-skilled work. “A BPO is not just a ‘call centre’ job. Fifteen per cent of the workforce comprises engineering graduates, 12-15 per cent are accountants and 8 per cent are medical doctors, and this message needs to be conveyed,” said KS Viswanathan, vicepresident of the initiative for the IT lobby group.

To convey this message to graduates, Nasscom is even evaluating presentations by global advertising companies to spruce up the message across social media. JWT and O&M are reported to be the two major contenders. The two agencies could not be immediately reached for comment.

According to Nasscom data, by 2020, the BPO sector will employ 2 million and analytics will become the industry’s biggest driver by 2016. “No one who passes out of an engineering college wants to join the BPO industry. It’s considered a ‘failure’ industry. It’s the last option for most,” said a senior marketing executive at one of India’s top five BPOs. The re-branding drive aims to change this image.

To convey the shift in services, Nasscom last year decided to rename the sector as Business Process Management (BPM) and created an industry council to create ways to change public perception.

BPO companies are not just fighting with rivals such as Accenture for business, but also for talent. And the recent rise of the startup industry in India had added to the competition. Companies such as First-Source are investing in analytics startups while Hinduja Global SolutionsBSE -0.10 % is setting up a corporate venture capital fund to get access to products and talent.

The colleges shortlisted in the first phase of the exercise are based in Bangalore and Chandigarh. Later, the industry plans to rope in more institutes and even get the government to talk about its contribution, added a source. Also on the cards are analytics contests in colleges, Viswanathan said, similar to those conducted by top IT companies, to showcase the sector’s need for high-end skills. Winning colleges will get multiple internship opportunities to experience work at a BPO.

“Ideally, the industry would like to be able to hire 1,000 people from these colleges,” said a top executive at one of the BPO companies participating in programme. “The demand from the companies is there, but first we have to brand it so that it is attractive for the students.”

Though the Indian BPO industry started with call centres, the bigger firms have been moving to higher-value services such analytics, finance & accounting, and healthcare services. In fact, in Genpact’s latest conference call with analysts, the company was asked how it intended to compete with players such as Accenture. And a BPO like EXL — which has a workforce of 23,000 — employs 1,500 data scientists.

“While the industry has transformed immensely, the public perception has not. It is often considered a place for back-room and mundane tasks, which is far from true today. We want students and budding professionals to know that patents and high-end solutions are created as much in this industry (if not more) as any other!” said Keshav Murugesh, CEO of WNS Holdings. Murugesh is also the chairman of the Nasscom BPM Council.

Sandip Sen, CEO at Essar Group’s BPO arm Aegis, said, “Students want to go to startups and IT companies. We want to tell them (that) we do high-end work and file for patents in this industry too.” The industry is expected to post $50 billion in revenue by 2020 and nearly 60 per cent of this will come from high-end services such as analytics and finance & accounting by the end of the decade.

“Sectors can be re-branded and tying up with (an) advertising company is a good start. Industries such as IT, Indian Army have in the past done this to make a career with them desirable,” said Santosh Desai, India CEO and MD of Futurebrands India and former president of McCann-Erickson. Desai added that an initiative like this will need more methods than just social media and it will take two-three years for an image makeover to work.


Acquire BPO completes 100% Shore Solutions acquisition

November 13th, 2014

Melbourne, Australia-based Acquire Business Process Outsourcing (BPO) has already completed the 100% acquisition of homegrown Shore Solutions Inc., one of the fastest-growing BPOs in the Philippines.Outsourcing31

The acquisition adds approximately 2,000 employees to Acquire, with an aim to provide a full suite of outsourcing operations for major corporations across Asia, Australia, the United Kingdom, and the United States.

Acquire’s acquisition of Shore Solutions is its second in less than a year.

In January, Acquire bought the Philippine company Animation1, thus its foray into the 3D animation market.

Scott Stavretis, chief executive officer of Acquire and Shore Solutions, said the Shore Solutions’ acquisition offers several exciting opportunities for Acquire in diversifying its current service offering and bolstering its revenue.

Shore Solutions has proven expertise human resource outsourcing (HRO); knowledge process outsourcing (KPO); IT (information technology); and professional services, which all complements Acquire’s outsourcing capabilities.

Shore Solutions is also a value-added reseller of SAP-SuccessFactors Human Capital Management (HCM) cloud technology, which is now included in Acquire’s service offerings.

Shore’s contact center division, meanwhile, has grown rapidly over the past 3 years and services a range of clients across the globe, including some very large, well-known household brands, Stavretis said.

The acquisition will scale the Acquire employee numbers to about 7000 globally.

Future acquisition activity, including its current strong, organic growth of both businesses, positions Acquire as a strong disruptor in the competitive landscape of the BPO industry.


Capgemini third-quarter revenues grow 2.8% to €2.59bn

November 7th, 2014

French IT service provider Capgemini has posted a 2.8% revenue growth for the third quarter (Q3) of 2014 to €2.59bn, thanks to demand for its application services in the UK and in North America.

The system integrator’s application services division – which accounts for 55% of its total group revenues – grew 5.1% after enterprise application projects in the UK and in North America. Meanwhile, growth in its “other managed services” division – which represents 27% of the total revenues – remained flat (0.6%) and consulting services segment (4% of group revenues) contracted 3%.

Capgemini’s regional revenue breakdown showed UK and Ireland revenues grew 4% and North America grew 11.9%, thanks to demand from financial services, energy and utilities, as well as in the retail and consumer goods sectors.Outsourcing22

“In spite of an economic environment which remains mediocre in Europe, Capgemini reports strong performance,” said Paul Hermelin, chairman and CEO of Capgemini Group.

The latest quarterly growth is Capgemini’s fifth consecutive quarter of organic revenue growth year-to-year, driven by growth in its services portfolio such as business process outsourcing (BPO), application and infrastructure services, which collectively made up 82% of the service provider’s Q3 2014 revenues.

Strategy pays off
The strong Q3 performance is an indication the company will achieve its projected organic revenue growth of 2% to 4%; and operating margin rate between 8.8% and 9.0% for 2014, said analysts.

According to consulting firm Technology Business Research (TBR), Capgemini’s strategy to innovate its offerings and improve its competitiveness through industrialised services and automation will help it reach its profit goals.

Bookings for strategic offerings – such as cloud, mobile, big data and analytics, digital customer experience, and industry-specific and intellectual property (IP)-rich systems – increased 17% year-to-date. “This indicates Capgemini’s business value proposition attracts clients in Europe and North America and will contribute to the near-term revenue growth,” said TBR analyst Elitsa Bakalova.

“Capgemini continues to collaborate with partners to innovate its offerings with cloud, big data and analytics and mobility capabilities and set up the foundation for its expansion in mobility through industry-specialised offerings that cover the consult-build-run cycle,” Bakalova added.

Deals and services
Among the Q3 industry collaboration highlights for Capgemini were its partnership with VMware to bundle its consulting and mobile services with VMware’s mobile device management capabilities, including its AirWatch EMM software. Capgemini collaborated with Oracle to launch three Engineered Systems service offerings and received certification by SAP Hana for two retail applications.

“In 3Q14, two key modules of Capgemini’s Extreme Applications for retail solution were certified to run on SAP’s Hana platform, which allows retailers to identify best offers for a specific customer through analytics,” Bakalova said.

It also launched an Integrated Procurement and All-Channel Experience (inPACE) system for NetSuite in the retail industry and a “Virtual Company” cloud-based BPO system with NetSuite to differentiate traditional BPO offerings.

Big gains and losses
“The listed partnerships allow Capgemini to provide a vendor-agnostic value proposition to clients and differentiate core offerings such as BPO,” Bakalova said.

In Q3, the French outsourcing company signed services contracts with major enterprises including Dutch dairy company FrieslandCampina and Australia’s Wesfarmers.

But one of Capgemini’s big UK public sector contracts – with HM Revenue & Customs (HMRC) – will expire in June 2017.

HMRC expects to save more than £200m a year by abandoning its Aspire IT outsourcing contract when it expires in June 2017. Aspire is one of the biggest IT outsourcing deals ever signed by the UK government, costing on average £813m per year over the past 10 years. By the time the deal ends in June 2017, prime contractor Capgemini will have pocketed £10.4bn.


Protected by تهنئة
Get Adobe Flash player