The Federal Department of Health and Ageing has revealed it will be the latest Australian government agency to dump IBM’s Lotus Notes/Domino environment in favour of a switch to a collaboration platform built on the Outlook/Exchange ecosystem, as part of a continuing trend of migrations to the Microsoft platform.

In tender documents released yesterday and first reported by iTNews, the department noted that it currently used version 8.5 of the Lotus Notes/Domino system for its 6,000-odd staff located across some 40 sites around Australia. The platform is used for email, address books, contacts, calendaring and resource management (such as booking rooms) functionality.

“In late 2012, a decision was taken to transition/migrate email from Lotus Notes and Domino to Microsoft Outlook and Exchange,” the department noted. “This will allow the Department to more fully leverage the integrated functionality of the Microsoft Office suite and maximise the options available to it in considering the ongoing ICT support services and agreements that will be in place from mid-2015.”

As is common with organisations which have been using Notes/Domino for some time, the department also has a range of business applications which have been developed using the IBM platform, any of which interoperate with the email and calendar functions of Lotus. As part of its tendering effort kicked off this week, the department noted that it was also seeking advice on a strategy to decommission those platforms and establish alternate systems. It appears as though the department will go to market separately at some stage in the future for service providers to assist it with actually migrating off those legacy systems.

The current agreement under which DoHA operates its Lotus collaboration platform is an IT services arrangement which the department noted was scheduled to expire on 30 June 2015. “… there are sourcing and procurement strategies being developed to enable an appropriate sourcing process to be in place in advance of 30 June 2015,” the department wrote. “It is expected that the full migration of email from Lotus Notes and Domino to Microsoft Outlook and Exchange will be completed by June 2014, well in advance of any change in IT service provision arrangements.”

Also included as part of the deal will be the Therapeutic Goods Administration, which sources some, but not all, of its IT services from DoHA’s central IT function. The TGA has about 690 staff, primarily located in Canberra.

The news of DoHA’s shift away from Notes/Domino may reflect the first step in what could potentially be long-term plans to break up its extensive IT outsourcing agreement with IBM, which has not been formally tested in a tender process since it was signed in 1999.

In tender documents released in September 2012, DoHA noted that it was looking for an advising partner to develop and provide appropriate options for the provision of core ICT services; develop an ICT sourcing strategy, provide a project plan to implement the ICT sourcing strategy, and provide professional skills to develop the proposed ICT sourcing strategy. It is unclear how this new advice will relate to existing advice provided to Health on its ICT sourcing strategy and costing $1.5 million in 2010, as reported by iTNews.

It is unusual for sizable departments such as DoHA to require an external organisation to develop its IT sourcing strategy, with such a strategy more normally developed by the in-house office of the chief information officer. DoHA does have such an office — the Office of the chief information knowledge officer, as well as a centralised IT function which it describes as being responsible for the provision of the majority of its networked and shared IT services; and it also has discrete IT functions within certain line of business areas.

DoHA’s current chief information knowledge officer is Paul Madden, who was appointed to the position in December 2010.

The last time DoHA renewed the contract with IBM was in December 2010, after initially denying that it had done so, and in the context of significant media pressure from outlets such as iTNews, which has pointed out to Health that significant government contracts are required to be market tested through the tendering process regularly, to ensure departments are obtaining value for money. At the time, the department had gained special dispensation to be able to renew the long-running IBM contract without putting it to competitive tender.

Delimiter is currently seeking to access any ICT sourcing strategy advice provided to DoHA or developed internally, under Freedom of Information laws.

DoHA will be just the latest major Australian organisation to shift off Lotus Notes and onto Exchange, with many other groups having conducted such projects over the past few years. One notable exception is the Australian Bureau of Statistics, which has publicly described itself as “a happy Notes camper”.

opinion/analysis
It looks like the cracks are starting to appear in DoHA’s long-running relationship with IBM. I wouldn’t be surprised at all to see it break up the contract substantially over the next year and hand chunks off to rival companies such as CSC or Fujitsu.

Source:http://delimiter.com.au/2013/02/21/doha-latest-to-ditch-lotus-notes-for-exchange/

Dell put the rumors to rest today with its announcement that it will indeed go private as founder and CEO Michael Dell and private investment firm Silver Lake Partners acquire the company in a deal estimated at $24.4 billion.

But questions remain about what the new ownership model will mean for Dell’s IT services business-and its outsourcing customers.

“On the positive side, Dell will no longer be driven by quarterly earnings pressures and the need to put more resources behind the largest part of their business-PCs-[rather than] outsourcing,” says David Rutchik, partner with outsourcing consultancy Pace Harmon.

“By getting away from public scrutiny, they will be freed up to make investments in tools and in other areas to better compete in the IT outsourcing space, even if they won’t move the earning needle overall in the near term,” Rutchik says.

A private Dell could redouble its efforts to compete against the likes of IBM, HP, Accenture, TCS and Wipro at a critical time in the industry.

Dell Will Refocus IT and BPO Offerings

“With the IT services market slowing this year, the competition will be–and already is–stifling for the proliferation of vendors fighting over the scraps,” says Fersht. “Dell being insulated financially will allow it to refocus its IT and business process offerings and avoid gambling on unprofitable contracts, especially against low-cost arbitrage players, such as HCL and Syntel.”

Dell bought its way into the IT services market with its $3.9 billion acquisition of Perot Systems in 2009 and had recently begun to focus on more standardized offerings in the IT services space.

“Dell will likely accelerate changes in the IT outsourcing line of business including greater focus on remote, virtualized and standardized services to improve profitability and modernize service delivery,” says Bryan Britz, research director in the ITO and Support Services group at Gartner.

Dell May Target Midmarket

Dell could seize this opportunity to go after the middle market, which is opening up, says Fersht. But that would require changes in its sales structure.

“Dell says it is building IT services for the midmarket that can scale up,” says Britz. “I haven’t seen evidence that its sales model is effectively scaling down to that market. It’s an initiative they are working on.”

What IT Outsourcing Customers Should Shop Around

Dell’s IT outsourcing customers who rely on customized services, however, might want to start shopping around. “IT outsourcing will be much more industrial in design and delivery,” says Britz, “and that does mean Dell will likely stop doing some things they do today that are customer-specific, or seek price premiums for such exceptions.”

As for future IT outsourcing customers, the new Dell is more likely to woo clients willing to accept Dell technology within a managed private cloud, says Britz. “Similarly, Dell is also likely to seek increasing its traction in productizing IT outsourcing scope into services that lean upon its product support business.”

The nature of the deal–a leveraged buyout–may have outsourcing customers concerned that Dell would have to sell off part of its business to pay off debt.

Source:http://www.computerworld.in/feature/what-new-dell-means-it-outsourcing-customers-68762013

IT services company Cognizant Technology Solutions Corp’s quarterly profit modestly beat estimates, helped by a rise in demand from Europe after quarters of tepid growth in business from the region.

European companies have been outsourcing more as instability in the region forces them to restructure and cut costs.

Cognizant President Gordon Coburn that while it appears the worst was over for Europe’s economy, long-term challenges remain.

“We believe that these long-term challenges will serve as a catalyst for existing new clients to look to Cognizant to help them transform their operations in technology,” Coburn told Reuters.

Rivals Tata Consultancy Services Ltd and Infosys Ltd, India’s top two software services providers, reported better-than-expected results last month, helped by client additions and accelerated IT spending by existing customers.

Thirteen new deals in Europe boosted Infosys’ revenue in the quarter ended December 31 but TCS termed Continental Europe a “soft point”.

“We would expect Europe on a full-year basis to grow faster than the company average,” Coburn said.

Revenue from Cognizant’s European business rose 19 percent in the fourth quarter, after three consecutive quarters of slow growth.

The company has been facing slowing revenue growth from North America, which accounts for the bulk of its revenue.

Revenue growth in North America slipped below the 20 percent mark, continuing the downward trend from past quarters.

In addition to that, economic uncertainty in the United States in the fourth quarter due to the presidential elections, the approaching “fiscal cliff” and superstorm Sandy forced companies to postpone technology spending.

Cognizant shares were up 2.3 percent at $78.06 in late morning trading on the Nasdaq.

TEPID OUTLOOK

Cognizant forecast full-year profit below analysts’ estimates. The cautious outlook, which many analysts had expected, comes after the company was forced to cut its 2012 projections in May for the first time in nearly four years.

“We learned from our mistake last year,” Coburn said on a conference call with analysts.

The company expects pent up demand in its financial services to be released after “significant” pullbacks in spending over the last several quarters.

Cognizant gets about 40 percent of its revenue from financial services clients such as JPMorgan Chase & Co , Rabobank and UBS AG . Financial services revenue grew 20 percent in the fourth quarter.

“Cognizant is probably being conservative at the start of the year, instead of guiding to Street estimates, which do not include acquisition revenues,” BMO Capital analysts said in a note.

Net income rose 16 percent to $278.8 million, or 92 cents per share, in the fourth quarter, from $240.1 million, or 78 cents per share, a year earlier.

Total revenue rose 17 percent to $1.95 billion. Revenue from Europe, which accounts for nearly a fifth of the company’s total revenue, rose 19 percent to $326.2 million.

Analysts on average had expected earnings of 91 cents per share on revenue of $1.95 billion, according to Thomson Reuters I/B/E/S.

The company, founded in 1994 as a captive unit of Dun & Brad Street in India, has not missed analysts’ profit estimates for 16 quarters.

It forecast first-quarter earnings of 92 cents per share on revenue of at least $2 billion.

The company, which has said it expects healthcare to grow slower than the company average in 2013, forecast at least $3.95 per share in profit for 2013 and revenue of at least $8.6 billion.

Analysts expected earnings of 93 cents per share, on revenue of $2 billion for the first quarter. For the full year, they were looking for a profit of $4.00 per share, on revenue of $8.58 billion.

Source:http://in.news.yahoo.com/cognizant-reports-quarterly-profit-rise-16-percent-111400403–sector.html

iSoftStone Holdings Limited (”iSoftStone,” NYSE: ISS), a leading China-based IT services provider, and Huawei Technologies Co., Ltd. (”Huawei”), a leading global information and communications technology (”ICT”) solutions provider, have completed the formation of iSoftStone Technology Service Limited (”the new joint venture”), a joint venture based in Wuhan, Hubei province, China. The new joint venture began operations today, January 24, 2013.

In September 2012, iSoftStone announced the planned formation of the new joint venture that focuses on serving the technology and communications (”T&C”) industry. The new joint venture has registered capital of RMB 100 million, with 75% owned by iSoftStone and 25% owned by Huawei. As previously announced, iSoftStone has not contributed any U.S. assets to the new joint venture.

Mr. T.W. Liu, Chairman and CEO of iSoftStone, will also serve as Chairman and CEO of the new joint venture. The new joint venture’s workforce is expected to reach more than 20,000 employees by 2015. The new joint venture should be mutually beneficial to both Huawei and iSoftStone. In addition to securing a long-term, large-scale, and sustained business account from Huawei, the new joint venture should help iSoftStone strengthen its core competitiveness through the continued integration of the fragmented IT services industry in China. The new joint venture should provide Huawei with a long-term and committed partner that will deliver outstanding IT services through the new joint venture’s team of highly qualified and talented employees.

Mr. Liu said, “Thanks to the impressive growth of the information & communications technology industry in the region, IT services in China have continued to grow rapidly amid slower growth or reductions in IT expenditures in other parts of the world.

“The new joint venture is part of iSoftStone’s strategy to benefit from this market opportunity. The new joint venture fuses Huawei’s excellent practices in management and its leading position in the ICT market with iSoftStone’s accumulated vertical depth in technology & communications services. We expect the new joint venture to become a leading global IT services company focused on serving current and prospective clients in the T&C industry, in both the private and public sectors.

“We believe the new joint venture should experience stable growth by leveraging advantages provided by both partners. Leveraging Huawei’s leading position in the global ICT market, the new joint venture should help further expand iSoftStone’s market knowledge and capabilities in the T&C vertical, which will be an important cornerstone for iSoftStone in becoming a major integrated IT services and solutions provider serving multiple industry verticals.

Mr. Qiuen Peng, Senior Vice President of Huawei, said, “We are very pleased with iSoftStone’s effectiveness in establishing the new joint venture. We look forward to working with iSoftStone as a team in the joint venture as we create a leading IT services provider in the T&C vertical. We believe the new joint venture will provide very high quality services to its clients, including Huawei.”

For additional information about the new joint venture, please see the Form 6-K that iSoftStone filed with the U.S. Securities and Exchange Commission on September 4, 2012.

iSoftStone safe harbor statement

This news release contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include those related to timing, effectiveness, and expansion of the new joint venture, the anticipated financial and other benefits and impact of the new joint venture to the parties, our strategy as it relates to the new joint venture and our other businesses, including the new joint venture’s ability to benefit from Huawei’s industry experience and leadership position to satisfactorily deliver IT services to its technology and communications customers and our ability to deepen our vertical capabilities to become a full-service IT services provider. For additional information regarding the new joint venture, please see the Form 6-K iSoftStone filed with the U.S. Securities and Exchange Commission on September 4, 2012.

Our forward-looking statements are not historical facts but instead represent only our belief regarding expected results and events, many of which, by their nature, are inherently uncertain and outside of our control. Our actual results and other circumstances may differ, possibly materially, from the anticipated results and events indicated in these forward-looking statements. We may not realize the financial targets or anticipated benefits of the new joint venture. We may experience operational or difficulties or management distraction in transitioning the T&C business to the new joint venture; our and Huawei’s interests may not be fully aligned initially or may diverge in the future; existing or future customers may not wish to have their IT services provided through the new joint venture; and our competitors may seek to disrupt customer purchasing patterns or decisions. Our ability to grow our business (including through the new joint venture) is subject to our ability to continue to realize operational and delivery efficiencies and continued strong client demand or achieve a diversified revenue base, effectively capitalize on our growth opportunities and strategies, enter targeted markets, or otherwise grow our business in the manner planned, successfully complete planned acquisitions or strategic investments, or recognize the anticipated benefits of our acquisitions and strategic investments, on a timely basis or at all. Our customers may also vary their purchasing patterns in response to the economic environment in Greater China and globally. In addition, other risks and uncertainties that could cause our actual results to differ from what we currently anticipate include: our ability to effectively manage our rapid growth directly and through the new joint venture; intense competition from China-based and international IT services companies; our ability to attract and retain sufficiently trained professionals to support our operations; and our ability to anticipate and develop new services and enhance existing services to keep pace with rapid changes in technology and in our selected industries. For additional information on these and other important factors that could adversely affect our business, financial condition, results of operations, and prospects, please see “Risk Factors” that begins on page 7 of our 2011 Annual Report on Form 20-F that iSoftStone filed with the U.S. Securities and Exchange Commission on April 27, 2012, which can be found on our website at www.isoftstone.com and at www.sec.gov.

Source:http://www.heraldonline.com/2013/01/23/4565260/isoftstone-and-huawei-complete.html