Monday, October 31, 2005

Ericsson Opens R&D, Service Center in India

Swedish telecom equipment manufacturer, Ericsson, will open an R&D and regional services delivery center in the South-Indian city of Chennai (Madras).

According to Ericsson officials, the new center will work in the areas of GSM, value-added services and intelligent networks, and also focus on the domestic market.

The company has also set up a Global Services Delivery Center (GSDC) in Gurgaon near New Delhi. The Gurgaon center will provide service support to the Indian and Asia-Pacific markets and includes a network operating center, a product design and customization center, a systems integration competence centre, and also offers support to network operators.

In 2003, Ericsson had transferred 300 employees from its three R&D centers in India to Wipro, a Bangalore-headquartered IT services company, as part of its cost-cutting strategy. Wipro will continue to do product development for Ericsson’s global requirements. The company also has a manufacturing unit in the country.
The company currently has over 1,500 employees in 22 Indian locations, and engages over 3,000 employees from other companies for its development, network roll-out and other service needs.

Labor Shortage to Hit Indian Call Center Industry – Gartner

According to Gartner, the existing shortage of skilled professionals faced by Indian BPO service providers may result in the country losing its competitive advantage.

As per the firm, the current shortage of appropriately skilled workforce will have a major impact in terms of increased wage rates thereby increasing the costs. Quality and security concerns are also expected to emerge as a direct result of the shortage.

As per Government estimates, the industry requires close to one million trained professionals by 2009. However, the supply is expected to be short by at least 260,000 professionals.

Gartner further notes that the shortfall will hit the multi-national service providers the most, as many of them anticipated an almost unlimited supply of English speaking graduate workforce.

Amazon to Open SDC in India, the US-headquartered online retailer, has announced its plans to open a Software Development Center (SDC) in Chennai (Madras), India. The center will focus on developing new web site features supporting the web retailers’ online customers.

The Chennai center will manage all technology aspects of the web site features developed at the SDC. The center will be the second international SDC in India after Bangalore and the fourth worldwide along with Edinburgh, Scotland and Cape Town, South Africa.
TCS has announced the opening of a remotely-managed infrastructure and BPO solution center in the Southern Indian city of Chennai. The center has been set up with an investment of INR 450 million and would provide end-to-end IT infrastructure services to clients. The center, which has a capacity of 2,500 people, would initially employ around 300 people. It will also complement similar centers at Bangalore and Budapest, Hungary. The company expects IT infrastructure services to contribute about 10 percent of the total revenue and other four areas to contribute about five percent each to the total revenue in the next five years.

Saturday, October 29, 2005

TCS has announced the opening of a remotely-managed infrastructure and BPO solution center in the Southern Indian city of Chennai. The center has been set up with an investment of INR 450 million and would provide end-to-end IT infrastructure services to clients. The center, which has a capacity of 2,500 people, would initially employ around 300 people. It will also complement similar centers at Bangalore and Budapest, Hungary. The company expects IT infrastructure services to contribute about 10 percent of the total revenue and other four areas to contribute about five percent each to the total revenue in the next five years.

Friday, October 28, 2005

NEC and Unisys to Collaborate in Technology Research and Development, Manufacturing and Solutions Delivery Worldwide

Global partnership aims at better innovation at less cost through common server platform, shared software development, support services and solution integration

NEC Corporation (NASDAQ:NIPNY) (FTSE: 6701q.1) and Unisys Corporation (NYSE:UIS) today announced that they have signed a Memorandum of Understanding to negotiate a partnership to collaborate in technology research and development, manufacturing and solutions delivery. This alliance would cover a number of areas of joint development and solution delivery activities focusing on server technology, software, integrated solutions and support services.

Technology Alignment
NEC and Unisys plan to collaborate to design and develop a common high-end Intel-based server platform to provide customers of each company with increasingly powerful, scalable and cost-effective servers. The first of these next-generation common platforms is planned for release in 2007. The new servers are to be manufactured by NEC on behalf of both companies. Unisys will continue to supply its customers with ClearPath mainframes with the benefit, over time, of joint R&D by both companies and manufacturing provided by NEC.
The two companies plan to supply to each other their current Windows- and Linux-based middleware products, such as NEC's "VALUMOware" and Unisys Sentinel software. They also plan to jointly develop new middleware aimed at maximizing application and systems management efficiency.

Solutions Alignment
Together, NEC and Unisys plan to extend the customer value and effective geographic scope of their solutions business. Initial areas for the planned collaboration include:

-- Security Products and Solutions. Unisys and NEC both have a strong background in providing their respective offerings in the security market for some of the most demanding industries and government organizations. The companies are planning several new and expanded initiatives that combine NEC's sophisticated biometric devices - such as fingerprint, palm print, and facial recognition systems - with Unisys domain expertise in developing security solutions for financial services, airline transportation, federal government international border control and other industry segments.

-- Telecommunications Solutions. The companies have agreed to explore opportunities for network-based services for the telecommunications industry in order to leverage their respective core competencies. The parties may also collaborate to deliver an end-to-end solution for the emerging IP Multimedia Subsystem (IMS) sector that will help global carriers deliver new services through convergence between existing fixed and mobile networks.

-- 3D Visible Enterprise Solutions. Under the terms of the partnership, NEC will explore the use of Unisys 3D Visible Enterprise (3D-VE) methodology to improve the delivery of services to its clients. 3D-VE is Unisys foundational approach to marrying domain expertise with technical scenario modeling tools to provide customers with a rich, three-dimensional representation of the costs and impacts of IT decisions at all levels of their business organization.

-- Worldwide Opportunities. NEC and Unisys plan to collaborate to advance their intersecting interests in areas such as in consulting, systems integration, outsourcing, and leading-edge solutions as they engage a broad spectrum of customers in countries such as the United States and China, as well as other growth markets.

Support Alignment
-- Maintenance and Support. Under the proposed arrangements, Unisys would become the preferred partner to provide technology support and maintenance services, such as break-fix support, to NEC's customers in markets outside Japan. Additional areas for exploration include how NEC can leverage Unisys global footprint in other service areas.

While non-binding, the Memorandum of Understanding contemplates the negotiation of binding agreements that would give effect to the areas of collaboration mentioned in this release.

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Wednesday, October 26, 2005

Learning Outsourcing ... HR Outsourcing's NEXT wave !

Convergy's study on Learning outsourcing is out now and its wonderful.Especially when Fortune 1000 companies spending more than $100 Million each for their training needs.

Today’s learning organization faces immense challenges in achieving this vision, stemming from the complexity of technology, the decentralization and disaggregation of the learning function itself, an escalatingburden of administrative responsibilities, and a lack of funding and resources to make the up-front investments required for learning transformation.

According to the report Learning outsourcing is being driven by four major trends:

1. Emergence of scalable, enterprise technologies for learning. These technologies enable more effective creation, delivery, and management of learning across the organization.
2. Application of shared service principles to the Learning & Education - L&E function. An increasing number of companies, following the lead of HR, are creating shared service functions for learning that provide infrastructure and administrative services across the enterprise.
3. Proliferating supply chain for learning services. Training is an immense procurement activity, and with the influx of technology and services providers, the supply chain for learning continues to multiply and presents the buyer with increasing complexities.
4. Escalating size of corporations’ investment in learning. It is not uncommon for a Fortune 1000 company to spend more than $100 million annually on training. Add learning opportunity costs—the productivity lost when employees are removed from their jobs to the classroom—and that figure can easily double.

Download the report from or

Monday, October 24, 2005

Tata Consultancy Services (TCS) has acquired Financial Network Services (FNS), a Sydney, Australia-based banking solution provider for around USD 26 million. The deal is expected to strengthen the banking and financial services division of TCS along with increasing its global customer base. FNS' Core Banking Solution has been installed in over 115 banks spread over 35 countries and its clients include Tier I and Tier II banks in emerging markets in Europe, Asia, Australia and Africa.
Perot Systems has completed the acquisition of Technical Management and its subsidiary Transaction Applications Group (TAG), a US-based policy administration services company. Perot acquired a 100 percent stake in TAG for USD 65 million along with USD 18 million which is subject to certain performance targets. The move will not only strengthen the company's focus on the insurance industry but also help in achieving improved performance levels. The acquisition, which would also see the addition of around 850 TAG employees to its workforce, is also expected to help the company spread its BPO capabilities. The addition would take the worldwide Perot BPO strength to about 4,700 employees. The BPO operations currently contribute about 18 percent of the company's total revenue.

Sunday, October 23, 2005

Perot Systems has completed the acquisition of Technical Management and its subsidiary Transaction Applications Group (TAG), a US-based policy administration services company. Perot acquired a 100 percent stake in TAG for USD 65 million along with USD 18 million which is subject to certain performance targets. The move will not only strengthen the company's focus on the insurance industry but also help in achieving improved performance levels. The acquisition, which would also see the addition of around 850 TAG employees to its workforce, is also expected to help the company spread its BPO capabilities. The addition would take the worldwide Perot BPO strength to about 4,700 employees. The BPO operations currently contribute about 18 percent of the company's total revenue.

Saturday, October 22, 2005

Outsourcing Research :

According to a recent study by TPI, the total dollar value of the outsourcing contracts signed in 3Q 05, is expected to decrease by 10 to 15 percent to between USD 60 billion to USD 65 billion. The study also claims that the Total Contract Value (TCV) of the deals signed till 3Q 2005 was about USD 43.8 billion while the comparative global total for the same period last year was USD 52 billion. The main reason behind low TCV figures is the improvement in the efficiency of buy-side strategies, reduced capital intensity and increase in number of short term IT outsourcing contracts. It also claims that about 28 percent of contracts were restructured and set at new competitive rates. However, the total number of outsourcing contracts signed year-to-date increased from 172 to 191. In 3Q 2005, a total of 57 contracts valued at USD 13.5 billion were singed as compared to 54 contracts worth USD 15 billion in the preceding quarter. For 3Q 2004, 49 contracts worth USD 19 billion were recorded. As per TPI, the trend of decreasing value of individual transactions and increase in the number of overall transaction is going to persist in the coming period.

A recent study by InfoTrends/CAP Ventures predicts the US document outsourcing market to grow to USD 38.3 billion by 2009. The market is perceived to grow at a slow but steady state for the period between 2004 and 2009 at CAGR of 4 percent. The study foresees a relatively higher growth in the high value added segments involving process like digital color production printing and Document Process Outsourcing. For 2004, the US document outsourcing market was estimated to be around USD 31.5 billion with about 22 percent of the revenues coming from on-site services. Off-site contracted services accounted for 67.3 percent of the total document outsourcing market in 2004 and is expected to grow at a CAGR of 3.8 percent till 2009.

Thursday, October 20, 2005

Prince William Health System Chooses Perot Systems for Revenue Cycle Outsourcing

Agreement Brings Efficient, Cost Effective Solutions To Growing Health System

Perot Systems Corporation (NYSE: PER) announced [ Oct 13 2005 ] that the company has entered into an agreement to provide revenue cycle outsourcing solutions to Manassas, Virginia-based Prince William Health System.

Under terms of the seven-year agreement, Perot Systems will assume day-to-day operational and administrative responsibility for the business office functions and staff of the 170-bed healthcare delivery system. Perot Systems will provide billing, accounts receivable management, and third-party and self-pay collections services for Prince William, and will assume responsibility for its Medicaid eligibility services. The company will also deliver technology resources to implement contract and denial management systems for Prince William.

Of the agreement, Robert Riley, chief financial officer of Prince William Health System said, “Perot Systems clearly understands revenue cycle management and has demonstrated its commitment to producing sustainable results for our health system. In addition to the company’s expertise, we are excited about the professional development and training opportunities that Perot Systems brings to Prince William’s business office staff. It is this combination of expertise and staff development capabilities that led us to choose Perot Systems as our revenue cycle management partner.”

“We are pleased that Prince William has chosen Perot Systems,” said Joe Hodge, leader of Revenue Cycle Solutions for Perot Systems’ healthcare group. “Leveraging Perot Systems’ dedication to operational excellence and best practices, we are confident that we can help Prince William achieve a new level of financial efficiency that will help fuel its vision and strategy for growth, patient satisfaction and community service.”

Perot Systems currently serves more than 350 hospitals with information technology and business processing solutions, and is known for its innovative approach to helping providers leverage improvements in the revenue cycle to fund strategic healthcare technology initiatives. Prince William joins Seattle, Washington-based Northwest Hospital and Medical Center, and Michael Reese Hospital in Chicago, Illinois as Perot Systems’ newest revenue cycle solutions customers.

Check for more !

TPI Index Forecasts 10 to 15 Percent Decline in Global Outsourcing Total Dollar Value Awarded This Year

On October 17, 2005, TPI published its latest market observations in the TPI Index, a quarterly report on the state of the global outsourcing industry for financial analysts, media and sourcing industry participants.

The TPI Index, a quarterly report on the state of the global outsourcing industry for financial analysts, media and sourcing industry participants, says third-quarter results indicate an expected decrease of 10 to 15 percent in total dollar value for outsourcing contracts awarded in 2005, to US$60 to $65 billion from an average of US$72 billion awarded in recent years.

To date, the year's total contract value (TCV) is US$43.8 billion for transactions signed in the Americas (US$21.3B), Europe (US$20.3B) and Asia (US$2.2B), compared to a global total of US$52 billion this time a year ago.

Click here to download the report ...

EDS and Guthy-Renker Extend Long Term Relationship Through 2010

Relationship Includes BPO Services Supporting Guthy-Renker’s Global Expansion

EDS and Guthy-Renker, one of the world’s largest direct response marketers, today announced the extension and expansion of the companies’ long-term relationship for business process outsourcing (BPO) services through 2010. This new agreement is one of EDS’ largest BPO agreements to date, and continues EDS’ current customer relationship management (CRM) services for Guthy-Renker’s U.S. operations and add similar services for its Australia and New Zealand markets. Financial terms of the contract were not disclosed.

As a part of this contract extension, EDS will support Guthy-Renker’s global growth by providing CRM services to Guthy-Renker’s growing customer base in the southern Asia Pacific region. EDS will operate out of a new fulfillment facility in Australia and expand its existing New Zealand customer contact center to support Guthy-Renker’s consumer-direct business.

Our success in the U.S. has carried over to a number of markets around the globe. Having a reputable and cost efficient service provider like EDS is vital to our continued success,” said Kevin Knee, Executive Vice President and COO for Guthy-Renker. “EDS has consistently proven its abilities to scale and to meet our growth demand. This new agreement is a natural extension of our long standing relationship.”

Asia Pacific continues to be a growing region for EDS and we’re eager for the chance to support Guthy-Renker’s expanding business,” said Phil Pryke, EDS Asia Pacific vice president. “This new facility, along with the expanded use of our New Zealand contact center, will provide EDS with opportunities to fulfill additional CRM BPO demands in the Asia Pacific region.”

EDS will continue to process orders and payments, and manage assembly services, fulfillment, distribution and customer support of GRC's consumer sales of beauty and skin care lines and various other consumer products and categories in the United States, through 2010. Guthy-Renker shares these facilities and EDS’ global infrastructure, which helps it lower costs, streamline operations, improve customer service, increase revenues, and remain focused on product marketing.

Guthy-Renker and EDS mirror each other’s focus on quality and outstanding customer service to successfully launch our brands around the globe,” said Joe Eazor, vice president and general manager, BPO Services for EDS. “The combined expertise of Guthy-Renker’s marketing and EDS’ technology and service delivery, creates a winning combination to boost revenue growth for multi-channel retailers like Guthy-Renker.”

Learn more at

Kodak and IBM Sign Deal to Transform and Manage Key Business Functions

Eastman Kodak, a US-based photography solutions developer, has awarded a five-year contract to IBM to revamp its business support solution. Under the contract, IBM is expected to revamp and provide payroll services and credit and collections management services. The contract is part of Kodak’s initiative to reduce administrative costs and improve its service delivery mechanism.

IBM is going to provide the requisite services through its Business Transformation Outsourcing (BTO) division, which focuses on payroll calculation and delivery, benefits administration, expatriate and relocation services, enquiry management and CRM services, compensation planning, travel and expense processing. IBM has recently opened a new global delivery center in the Philippines to deliver such BTO services.

Wednesday, October 19, 2005

Tata Consultancy Services enters UK life and pensions industry

Initial Deal valued at £486m over 12 years; Commitment to maintain Centre of Excellence in Peterborough

Tata Consultancy Services, (TCS) announced its intention to move into the UK life and pensions industry after entering into exclusive discussions with Pearl Group Limited, the closed fund group, with the intention to transfer existing Pearl business processes to a new UK company, based in Peterborough, which will be a subsidiary of TCS.

This decision comes after a rigorous and extensive, year-long, selection process by Pearl Group Ltd, who examined tenders from a number of leading companies before they decided to choose TCS. The agreement will mean that a new company, a subsidiary of TCS, will be set up and will employ about 950 of Pearl Group’s current 1100 staff, with about 150 staying with Pearl.

The new subsidiary will specialise in BPO for life and pension businesses, starting with Pearl Group’s closed books portfolio. It will also focus on offering similar services to other life companies, presenting it with an opportunity for significant future growth as Business Process Outsourcing (BPO) is rolled out across the life assurance industry. This deal will generate revenues of over £486m ($847m) over the next 12 years as a result of creating a new platform beyond IT services.

Commenting on this strategic initiative, S. Ramadorai, CEO and Managing Director said, "This deal validates our strategy of pioneering the next generation of Business Process Outsourcing opportunities. Our extensive experience working in the insurance industry together with our excellence in technology will help us emerge as a significant player in life assurance and pensions administration services and help us continue our strong growth momentum."

Phiroz Vandrevala, executive vice president and global head of corporate affairs said: "TCS is delighted to be chosen by Pearl, a decision based on our long-standing work in the UK insurance industry, our track record of working for five of the top 10 UK insurance companies and the result of our 14 year relationship with Pearl. TCS will sign a long-term lease at the Peterborough site and our intention is to establish a BPO centre of excellence for the UK there."

A.S. Lakshminarayanan, VP and country manager, United Kingdom & Ireland said, "TCS has been recognised for its outstanding contribution to the United Kingdom's knowledge economy, and together with the strength and heritage of Pearl and its professionals, we will create a new force in life and pensions BPO in the UK."

For more info visit and

Tuesday, October 18, 2005

Good Technology Launches Indian Operations

Good Technology, a US-based provider of wireless computing software and services, has formally opened its Indian support center at Hyderabad.

The Indian center is expected to provide a range services including engineering, Quality Assessment (QA), and sales support to a number of Good Technology products and services including enterprise software applications like GoodLink and GoodAccess. The company is looking at developing the center as a hub to support its global operations spread across the US, UK, France and Germany.

According to company officials, the availability of cost effective, high quality workforce prompted the company to spread its operations to India.

Monday, October 17, 2005

Reuters to Offshore Corporate Research to India

Reuters, the UK-headquartered news and information delivery conglomerate, will offshore corporate research and other allied valued added research actives to a New Delhi-based Knowledge Process Outsourcing (KPO) company. Reuters employs close to 15,500 people and reported sales of USD 5.5 billion for 2004.

Copal Partners, the Indian partner for the deal, would execute research initiatives supporting Reuters’ databases providing financial and other related information on companies. Copal Partners, according to company officials, will provide financial research and analytical services. To meet the requirements, the company will also increase its current staff strength by 40 percent.

Reuters already has a captive offshore unit at Bangalore, India, which employs close to 1,000 people in data analytics and a small group supporting the news and current affairs division.

Well thats business and money matters. But lets wait and watch how the Reuters UK employees going to react to this deal.
They wont call it " Cost cutting " - for sure,for them its "Axing"! When Reuters opened its first Offshore research center in Banglore India,the reaction from Reuters UK employees were tough.They went on strikes that affect the media giant very badly.Well lets see how smart the Reuters HR guys are .. .!

For more information check and

Saturday, October 15, 2005

OfficeTiger Reaches Agreement to Acquire MortgageRamp
to Expand Financial Management Services Offering...

Leading professional support services firm, OfficeTiger, today announced that it has reached an agreement to acquire MortgageRamp, a leading provider of business-process outsourcing and technology solutions for the global real estate finance industry with established offices throughout the United States for $48 Million.

The agreement will add 150 clients, including many top global financial institutions, to OfficeTiger’s client roster and greatly expand its existing Financial Management Services (FMS) capabilities by bringing a large number of seasoned real estate finance and technology experts to the table.

OfficeTiger provides integrated onsite-offshore services to professional services firms and Fortune 500 companies through its four service lines: Premedia, Financial Management Services, Research & Analytics and Transaction Processing.

Currently, OfficeTiger partners with the real estate industry to align back office processing with portfolio objectives to optimize property operating performance through its FMS division.

“The agreement solidifies OfficeTiger’s position as a global sourcing solutions provider offering integrated onsite-offshore services through a presence in expanded multiple geographies,” said Randolph Altschuler, co-CEO, OfficeTiger. “MortgageRamp’s veteran knowledge and existing talent pool of 300 associates and network of more than 2,000 experienced real estate finance professionals will expand our Financial Management Services division to include real estate finance support services.”

As part of the agreement, MortgageRamp will become the Global Real Estate Division of OfficeTiger. Ken Beyer, CEO of MortgageRamp, will continue as CEO of the new Division and will report to OfficeTiger co-CEOs, Randolph Altschuler and Joseph Sigelman.

The acquisition of MortgageRamp is again expected to lead to cash flow, and may even involve another round of funding. In terms of revenues, this is the largest acquisition done by an Indian BPO company overseas. The only other major acquisition of this nature has been ICICIOneSource’s acquisition of Accounting Solution Group. ASG was a 600 employee outfit which was acquired by ICICIOneSource in April and could have involved a cash outflow of more than $ 20-$ 25m.

OfficeTiger acquired Devonshire of UK, in October, ‘04. London-based Devonshire Group has revenues of $20m and around 200 clients in the financial, legal, consulting, design and pharmaceutical verticals. Devonshire had a team of 250 in London and 40 in its Frankfurt operation when it was acquired.

Before the Devonshire acquisition, OfficeTiger raised capital in June ‘04. The holding company of OfficeTiger in New York was recapitalised in a private equity transaction involving a $50 investment by Francisco Partners, of which $25m was a direct investment. The remaining funds were used to buyout the existing investors in OfficeTiger. Neil Garfinkel and David Golob, each a partner with Francisco Partners, joined the Board of Directors of OfficeTiger.

for more check

Friday, October 14, 2005

Specialist Outsourcing Gaining Acceptance – Study

According to Datamonitor and Everest, the mid-level IT outsourcing service providers have bagged some prime services contracts for the period ending 3Q 2005, showing a marked increase in demand for utilizing specialist IT outsourcing providers to manage specific functions.

The quarter saw second-tier international vendors including US-headquartered Keane, and Pomeroy, along with Indian IT service providers like Tata Consultancy Services (TCS) and Infosys, signing their most voluminous contracts ever.

Datamonitor, for the study, tracked a total of 432 outsourcing deals, which was a percent less than the year-ago period. The value of deals also fell by 32 percent from USD 41.9 billion in 3Q 2004 to USD 28.5 billion in 3Q 2005, with the average contract size declining from USD 95.7 million in Q3 2004 to USD 66 million 3Q 2005. The main reason cited for the drop was that only about half the number of billion dollar deals tracked in 3Q 2004 were tracked in 3Q 2005.

Finance and Accounting Outsourcing (FAO) has been cited as the major upcoming segment. With deals such as the one signed between Accenture and National Australia Bank for servicing of the bank’s accounts payable functions from a center in Bangalore, India.

As per the Everest group, although the current FAO market is tapped only by major providers like Accenture and IBM, which hold 32 percent and 29 percent respectively, new entrants, such as Genpact (earlier known as GEICS) and WNS, another Indian BPO provider, are displaying impressive growth and posing tough competition to the market leaders.

reported by GlobalOutsourcingNow

Thursday, October 13, 2005

Unilever Looking at Offshoring F&A, HR to India

According to press reports, Unilever, in an effort to lower its operating cost, is considering to offshore a portion of its Western European jobs.

According to a company spokesperson, the personal care conglomerate is in discussions with both US-headquartered Accenture and IBM before considering any such move.
Both Accenture and IBM have significant presence in India and are looking at developing the local operations as a support base for IT and BPO contracts.

Unilever is said to be considering the relocation of HR, finance and computer services positions. Although, the company spokesperson did not confirm the exact location or the number of jobs to be offshored, as per a Financial Times Deutschland report, the company might move around 2,500 jobs to India and some Eastern European countries.

The newspaper further added that the company might enact its offshore plans for the IT departments as early as 2006, while the remaining may be implemented between mid-2006 and 2007.

Tuesday, October 11, 2005

Infosys Reports 36% Rise in 2Q Net Profit

Infosys Technologies, the Indian IT services provider, has reported a 36 percent increase in its net profit for 2Q 2005, driven by the increased demand for technology outsourcing services by overseas companies.

The company’s net income rose from INR 4.47 billion a year earlier to INR 6.06 billion. According to Nandan Nilekani, CEO and Co-founder, Infosys, the company received a number of contracts from Europe, including part of a EUR 1.8 billion contract from ABN AMRO.

The company expects to report a 31 percent rise in sales in the quarter, bringing in INR 24.5 billion in revenues.

Monday, October 10, 2005

PwC to Start KPO Operations in India

PricewaterhouseCoopers (PwC) has announced its plans to open a Knowledge Process Outsourcing (KPO) center in the Eastern Indian metropolitan of Kolkata (Calcutta). The operations will mainly cater to PwC offices at various locations and would focus on servicing accounting and project management requirements.

PwC has also decided to open a training center to train professional accountants to cater to the offshored service requests. The company is looking at hiring around 1,000 accountants for the center. The center would initially begin by servicing insurance related requirements of PwC UK.

According to John Minards, Head - Assurance Services, PwC Midlands UK, the company decided to set up the operations in city not only because of the presence of qualified English speaking professionals, low cost of operations, infrastructure facilities but also because of the support extended by the local government to ITeS. The entire project is expected to cost around GBP 1.6 million.

Senator Questions Texas HHSC Outsourcing Contracts :

Senator Gonzalo Barrientos from the State of Texas has called for a review of all the proposed as well as previous Texas Health and Human Services Commission (HHSC) outsourcing contracts.

Senator Gonzalo Barrientos of Austin, Texas has raised questions over the outsourcing contract granted by HHSC to Convergys, a Cincinnati-based HR and payroll management outsourcing solutions provider, in order to save around USD 21.7 million to the state exchequer. In a letter to the State government, the Senator pointed to a report by state’s auditor, which claims that none of the stipulated savings were made through the deal in the first year contract.
The cited audit report further states that the Commission's decision to outsource its HR and payroll services was based on incorrect cost data.
Convergys undertook the HR and payroll management function of HHSC last year under a five-year USD 85 million contract deal. The deal services records of 46,000 Texan government employees. In a response an HHSC spokesperson stated that the contract was not expected to lead to any savings in its first year of service.
HHSC still upholds the original stipulated savings estimate.
According to a recent study by Frost & Sullivan, the increasing dominance of IP-based contact centers is expected to significantly increase the demand for Interaction CRM (ICRM) -based applications in the Asia Pacific region.
The study projects that the market for such solutions will increase from USD 617.4 million in 2004 to USD 1.418 billion by 2011, growing at a CAGR of 11.3 percent. One of the prime reasons for the increase in uptake of such solutions is the decline of enterprise product lifecycles in the local markets, prompting replacements.

IP telephony providers can expect easy uptake in the Asian telecom market. However, they will have to improve their reliability and adjust the pricing of their product to tap maximum benefit out of this growth.
According to a joint study of the Associated Chambers of Commerce and Industry of India (ASSOCHAM) and Evalueserve, a global business research and Knowledge Process Outsourcing (KPO) company, the Indian BPO and KPO sectors could witness 100 Mergers and Acquisitions (M&As) and IPOs over the next five years, with the deals being valued at USD 3 billion to USD 5 billion.
The study estimates that nearly 80 percent of the projected USD 3 billion to USD 5 billion worth of deals would be signed by the prominent companies in the industry. The smaller companies in the BPO and KPO industry, numbering about 400, would account for the remaining 20 percent of the transactions. The joint report also forecasts that most of the 20 major deals, involving M&As and IPOs, would be undertaken by a group of 10 large companies, which will explore options to diversify, while the smaller companies will see significant acquisition and funding activity in the short term.

ASSOCHAM also outlined the possibility that the companies may consider IPOs in order to raise funds for expansion, both organic and inorganic. The study goes on to predict that that the Indian BPO and KPO industries, driven by the increased level of M&A and IPO activities, would undergo consolidation, leading to the creation of few listed global companies. The report also emphasizes that the success of these deals depends on the effective integration of the two companies that have been merged or acquired.
EXL to Provide Back Office Support to British Gas

EXL, a US-headquartered third party (BPO) company, has won a contract to manage the back office operations for British Gas, the UK-based supplier of residential gas and electricity.

EXL will provide the services from its facilities in Noida and Pune, India. The service deliveries are expected to begin in January 2006. Although the company declined to disclose the value of the deal, it stated that the contract, which is of a medium to long-term duration, would require an additional 750 to 800 employees.
EXL has already started hiring and training the employees for the contract.

Wednesday, October 05, 2005

AIG Invests $30M in TRG

AIG Capital, the US-based private equity investor, has invested USD 30 million in The Resource Group (TRG), a US-based BPO solutions provider, through AIG Global Emerging Markets Fund.

TRG plans to utilize the investment in financing its expansion plan. The expansion plan is focused at augmenting the company’s current services portfolio, as well promoting movement in new outsourcing domains. A portion of the fund will also be used to support TRG's organic growth. TRG reported USD 170 million in revenues in the previous fiscal year and presently employs 4,000 people.