Tuesday, January 31, 2006

Labor Arbitrage Key Factor for Offshoring – Everest Research

According to Everest Research Institute , labor arbitrage, which is one of the main factors for cost-saving in the offshore outsourcing model, will continue to drive most of the offshore outsourcing deals for the next thirty years.
The report counters the growing opinion that labor arbitrage is going to lose its importance as the driver for outsourcing in the wake of rapid hike in wages and lack of easy availability of skilled resource in major offshoring destinations like India. Everest reveals that hike in wages is phenomenon for a select section of talent pool. Further, the shortage of skilled labor is not an industry-wide trend but only affects certain domains.

The report also predicts that the global offshoring market will exceed the USD 160 billion mark by 2009, growing at a rate of 33 percent. Also, the non-IT offshoring will constitute around 45 percent of the offshore market in the next three years.

Wednesday, January 25, 2006

Lufthansa to Provide Centrally Managed Medical Archive to PERmed :

PERmed, a Hannover-based medical services company, has selected Lufthansa Systems, a German IT services provider, for supporting the technology infrastructure for a Regional Digital Archive (RDA) medical data exchange project. Lufthansa had completed the first phase of the project in 4Q 2005.

Lufthansa will store and manage a central database containing all the imaging and diagnostic data in digital format. This will include management of results and reports of several medical tests. The purpose of the project is to allow doctors and clinics easier and faster access to information while saving them the expense of maintaining computer archives.

Tuesday, January 24, 2006

Satyam’s 3Q Revenue Rises by 39.5% to INR 12.65Bn

Satyam Computer Services, an Indian IT outsourcing company, has reported revenue of INR 12.65 billion for 3Q 2006, constituting a rise of 39.44 percent over the revenue for 3Q 2005. The net profit for the quarter increased by 63.6 percent over 3Q 2005 to INR 2.7 billion.

The company raised its revenue estimate for the fiscal year 2006 and expects it to be within a range of INR 47.8 billion to INR 47.86 billion, with an annual growth of 35.7 percent to 35.9 percent. The company generated around INR 1.6 billion from the sale of its stake in Sify, an Indian Internet solutions and e-commerce services provider. Around 35 new customers were added to Satyam’s clientele in 3Q 2006. The company increased its employee strength by 950 to a total of 23,432.

Nipuna, the BPO services arm of Satyam, recorded revenue of INR 220.6 million, a rise of around 21 percent over the previous quarter. The BPO services provider struck a EUR 7 million animation development deal with a German animation firm, 4K Animation, in the quarter. Nipuna employs around 1639 people.
Genpact Awarded $60M F&A Svcs Contract with Linde

Genpact an Indian BPO services provider, has been awarded a multi-year, USD 60 million contract with Linde, a German petrochemical manufacturer, to provide Finance and Accounting (F&A) services.

Genpact will provide the requisite finance and accounting outsourcing services from its operation centers in Bucharest, Romania and New Delhi, India. The contract with Linde follows the seven-year contract that Genpact signed with Wachovia Corporation, a US-based bank holding company, for supporting its BPO efforts.

Monday, January 23, 2006

An alliance led by Xansa, Crystal Alliance, has won a GBP 70 million, seven year contract with Northern Ireland Water Service (NIWS) for supporting its customer billing services. The other members of the alliance are Echo Managed Services, a local CRM services provider, and AMT-SYBEX, a systems integration firm.
The Xansa-led alliance will provide front and back office customer billing and CRM services for around 760,000 customers of NIWS.
The new customer billing and collections system and the new CRM center will be functional by April 2007. NIWS also announced a subcontract with Echo, under which the latter will be responsible for customer billing and debt collection and management of the customer contact centre.
Communisis has acquired the British statement production business of HSBC, for GBP 3 million.
The company has also signed a 10-year, GBP 250 million contract to provide HSBC with document-based customer communication material. The unit will be responsible for the production and dispatch of a major portion of HSBC's UK paper-based customer communications, including statements. As a result of the deal, about 255 employees of HSBC will be transferred to Communisis

Monday, January 16, 2006

Trends in Indian ITES-BPO

Read the full article by clicking HERE > > >

Sunday, January 15, 2006

Lofty Expectations

In quarterly results posted yesterday, Infosys Technologies reported reported a 28% increase in net profit. Revenue was $559 million, up 32%. A separate statement, based on Indian accounting standards, said quarterly revenue grew 35% and net profit rose 31% from the year-earlier period. Yet, the company's American depositary shares fell $7.58, or 9.4%, to $73.06 as the result was below Wall Street expectations. That triggered Infosys's stock price to fall 4.7% Thursday in Mumbai trading.This illustrates the lofty expectations that accompany the bright outlook for India's IT services sector. Add to this, significant wage inflation, a squeeze for human talent, a strengthening currency, and emerging low-cost outsourcing alternatives, and you have the recipe for a volatile 2006.And who better to articulate the sentiment than a fund manager himself. In a recent article in the European Wall Street Journal, Pradeep Kumar, an investment manager at the Chola Mutual Fund in Mumbai contended, "The companies must maintain at least 30% revenue growth. Anything less, and I would consider the stocks expensive."

from BPO Journal

Thursday, January 12, 2006

AT Kearney Offshore Location Attractiveness Study

Decisions on what to offshore and where have gotten far more complex. The 2005 Global Services Location Index helps executives understand the options.


- AT Kearney

Friday, January 06, 2006

Accenture Revenues Grow by 12% to $4.2Bn for 1Q 2006

Accenture has reported USD 4.17 billion of net revenue for 1Q 2006, a 12 percent increase over the net revenue for 1Q 2005. The Consulting business unit accounted for 62 percent of the net revenue, totaling around USD 2.58 billion, whereas net revenue from the outsourcing business unit was USD 1.59 billion, 38 percent of the total quarterly figure.

The operating income for the quarter increased by 20 percent to USD 513 million, around 12.3 percent of the net revenue, against USD 427 million for the same period last year. New bookings totaled USD 5.54 billion, the highest quarterly bookings in seven quarters with the Consulting and Outsourcing units both contributing almost equally.

The selling, general and administrative (SG&A) costs for the quarter were USD 802 million, around 19.2 percent of the net revenue, compared with USD 750 million, around 20.1 percent of the net revenue for 1Q 2005. The company’s effective tax rate for the period was 37.4 percent.

For the three months ended November 30, 2005, the operating cash flow was USD 368 million, whereas free cash flow, defined as the operating cash flow net of property and equipment additions, was USD 290 million. The total cash balance of Accenture, for the period, was USD 1.69 billion, compared with USD 2.27 billion, for the same period last year. The decrease in the cash balance has been attributed to its share repurchases and payment of its cash dividend in the first quarter.

The Communication & High Tech operating group generated a net revenue of USD 1.05 billion for the quarter, a year-on-year rise of 8 percent. Financial Services contributed around USD 855 million, an increase of 6 percent. The other groups, namely, government, products and resources, collectively grossed around USD 2.27 billion.

for more info,Check www.accenture.com

Thursday, January 05, 2006

Alcatel Acquires Brazil’s GMK

Alcatel, the French telecom operator, has acquired GMK, a Brazilian CRM services provider. The latest acquisition will enable Alcatel, which already commands a strong position in the CRM sector through its subsidiary Genesys, to further expand into the Brazilian and Latin American markets.

GMK is based in Sao Paulo, Brazil, and currently employs a staff of 100 people. The company currently serves around 100 customers with a strong market presence in the financial services and outsourcing sectors. GMK will be merged into Alcatel Telecomunicações, Alcatel’s subsidiary in Brazil, and GMK employees will be incorporated into the workforce of Genesys.
The $50 Billion worth Global industry is calling .
Its awake and despirately looking for Cost-Deductions .
Outsourcing's new and GenX wave
" Architecture,BIM Outsourcing " is here !!!
Watchout this space for more ..

Tuesday, January 03, 2006

Strong Demand Powers Rise of Indian Outsourcing Providers

The Indian outsourcing industry has been growing due to surging global demand for its services.

Two of the main Indian IT outsourcing services providers, Infosys and Wipro, are anticipated to post revenue of USD 2 billion in the current fiscal year. The rising demand is also expected to reflect in the sales figures of a number of other companies like Cognizant and Satyam for fiscal year 2007. These companies are expected to report, on an average a 32 percent increase in sales and an average of about 27 percent in earnings for fiscal year 2006-2007.

However, the steep rise in the outsourcing industry is posing problems of scalability for smaller players in the BPO sector. In order to exploit the huge demand, it is essential for companies to offer scalable operations to their customers. Most of the small BPOs are currently unprepared to quickly scale-up their operation as per the rise in the requirement of their clients. An optimum size has, as a result, become a key selling point for the services providers.

The problem of lack of adequate scalability has been addressed by an expansion strategy involving mergers and acquisitions. As a result, 2005 saw number of mergers in the small and middle outsourcing companies.
US IPO Acquires Supersight, to Invest $15M in India

International Process Outsourcing (IPO), a US outsourcing services company, has acquired Supersight, an Indian outsourcing services firm based in Madras (Chennai).

Supersight has a 165-seat facility in the city and employs close to a 100 people. IPO is looking at using the center to provide end-to-end outsourcing solutions to its US, UK and Australian clients. The company is also planning to invest a further USD 15 million over the next 3 years in India.
ACS in Possible Sell-Off Talks

According to press reports, Affiliated Computer Services (ACS), the US-based IT and BPO service provider, is reportedly in talks for a possible sell-off with a group of investment companies. The price for is being speculated to be about USD 8 billion. However, the developments were not confirmed by officials from either side.

The investor group is being led by the Texas Pacific Group and also includes Bain Capital and Blackstone Group.