A new research conducted by CELRE shows that, because skilled IT workers are so difficult to find, highly skilled IT professionals are enjoying the highest rate of pay increases in three years, as well as one of the lowest rates of redundancy when compared to other industry sectors.

67,000 IT workers in 570 companies were included in the survey. The results indicated that the biggest salary growth was witnessed in jobs requiring business and IT experience, especially those involving project management.

On the other hand, salaries for entry-level IT jobs have declined over the last five years, mostly owing to the trend to offshore graduate level jobs. This has led to some concerns over the possibility that removing the 'bottom rung' of the job ladder may contribute to future skill shortages and consequently to even higher salaries for highly skilled IT professionals.

ICAP plc, the world’s premier interdealer broker, has selected Accenture to develop and maintain its European Union credit-trading platform under a five-year application outsourcing agreement.

“This initiative is designed to increase the capabilities and cost-efficiencies of our credit-trading platform in order to continue to drive growth in an increasingly dynamic and evolving global marketplace,” said James Dawson, business manager, credit products at ICAP.

Accenture will provide technology development and outsourcing services to ICAP through its Global Delivery Network, which includes more than 50 delivery centers across five continents.

“The leading capital markets firms today are focused on achieving the right balance of cost-reduction, long-term operational excellence and opportunistic expansion,” said Lloyd Altman, a senior executive in Accenture’s Capital Markets practice. “This strategic outsourcing agreement reflects ICAP's sharp global vision for growth and deep commitment to service excellence and shareholder value.”

About Accenture

Accenture is a global management consulting, technology services and outsourcing company. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. With 178,000 people in 49 countries, the company generated net revenues of US$19.70 billion for the fiscal year ended Aug. 31, 2007. Its home page is www.accenture.com.

About ICAP

ICAP is the world’s premier voice and electronic interdealer broker and the source of global market information and commentary for professionals in the international financial markets. The Group is active in the wholesale markets in interest rates, credit, commodities, foreign exchange and equity derivatives. ICAP has an average daily transaction volume in excess of $1.5 trillion, more than 60% of which is electronic. ICAP plc was added to the FTSE 100 Index on 30 June 2006. For more information go to www.icap.com.

IT and business services firm Logica has named Jean-Marc Lazzari as the new chief executive of outsourcing services. The new CEO will also join Logica's executive committee. He will be based in Paris and run the company's global outsourcing services business.  

Before being appointed chief executive at Logica, Lazzari was vice-president and general manager of Unisys Continental Europe. His duties covered the company's entire portfolio for continental Europe.  

Prior to his role at Unisys, he was head of IBM's global human resources solutions business and vice-president of the company's business consulting services for the EMEA West region.  

In reference to Lazzari's appointment, Logica's CEO Andy Green said: 

"I'm delighted to welcome Jean-Marc to the Logica team. It's an exciting time for us as we execute the program for growth we set out in in April. Jean-Marc's personal drive and deep experience of the European outsourcing services market will be invaluable to us as we grow the newly established outsourcing services division, an imporant component of our strategy."   

Global technology, outsourcing and consulting company Capgemini has announced that two of its Business Process Outsourcing executives have been included on FAO Today's list of FAO Superstars of 2008. They are Hubert Giraud, CEO fo global BPO services, and David Kaminski, vice president of finance and accounting. This is the second year that Giraud has been included on the list. 

The finance and accounting outsourcing journal FAO Today has now published the Superstars list for the fourth successive year. The list includes the most influential service providers in the finance and accounting outsourcing sector. 

 

Paul Spence, CEO of Global Outsourcing Services at Capgemini, said:

 

“We congratulate Hubert and David, and the entire Capgemini FAO team for being honored among the top FAO providers in the world. The recognition our BPO executives have received from FAO Today, is a reflection of the high-caliber of industry leaders driving our business, as well of the quality services we provide to our clients.”

Hubert Giraud has been with Capgemini since 1998, and has lead Capgemini’s Business Process Outsourcing practice since 2002. He is a leader in operational, financial and legal management, and is recognized for generating great customer wins and landmark alliances in the finance and accounting outsourcing industry.

David Kaminski joined Capgemini in 2007 as part of the North America BPO management team, and is recognized by the magazine for his background in Finance and Accounting, including leading two of Microsoft’s global financial services business lines.

A new global survey of information technology service providers and clients who buy IT and business process outsourcing (BPO) services shows that the current economic slowdown in the United States will most likely not have a major impact on the global IT services and BPO industry.

The survey was conducted by CyberMedia and it included 129 buyers of business outsourcing services and more than 200 service providers, both groups mainly from the U.S.  

IT services giants such as Tata Consultancy Services, Infosys and Wipro will be at an advantage during the slowdown period as they are better equipped to pursue new business opportunities.

The survey also shows that, in response to the slowdown, the IT services industry is increasingly focusing on markets outside the U.S. and re-aligning existing services areas.

IT service businesses mainly plan to focus areas that are currently in demand – systems integration, BPO and infrastructure management – on markets outside the U.S.

Companies that offer business outsourcing, infrastructure management and application maintenance services reported that the market recession had not affected the deals pipeline in this quarter and that, in many cases, the exact opposite was the case.

On the other hand, businesses selling new application development and offshoring services said that they were suffering delays, downsizing or renegotiation of contracts.

More than a third of the service buyers said that there were no large scale cuts in IT spending and approximately the same number of respondents said that their business leaders may outsource IT projects in the short term.

The majority of respondents predicted that the staff most likely to be affected by the slowdown and subsequent spending cuts in the short term were IT contractors, full-time hires and IT consultants.

The area least likely to suffer the consequences of the recession is business process outsourcing, said more than a half of the respondents.

Global Services editor Ed Nair said:

“BPO vendors handle business-critical processes needed to keep the business running. Most BPO assignments are long-term annuity contracts and thus shielded from the effects of economic cycles.”

The survey will be published in the upcoming issue of the Global Services magazine.

IT services provider Capgemini has signed a £26 million deal with Corus, one of the world's biggest steel manufacturers. The deal will allow the steel company to outsource its IT infrastructure to Capgemini.

The five-year agreement covers virtualisation, utility computing and adaptive storage facilities and will also see Corus' mainframe service moved to data storage facilities in Bristol and Rotherham.

Corus CIO Bruno Laquet discussed the relevance of IT outsourcing in achieving a company's business goals. He said:

“The quality and efficiency of our mainframe systems is of key importance to our customers and employees in ensuring that we manufacture and deliver the right products with the right quality at the right time.”

The Corus Group has headquarters in London. It was formed in 1999 and taken over by Tata Steel, part of the Tata Group, in April 2007.

 

IT jobs will pull through the credit crunch crisis, experts say, even though the aftermath of the recession will see around 11,000 workers lose their jobs this year, according to a research conducted by the Centre for Economic and Business Research (CEBR).

CEBR management economist Dominic Walley says: “We are expecting IT to be one of the stronger sectors over the next couple of years. Mergers and acquisitions activity has stopped, but companies' balance sheets are looking quite healthy at the moment."

IT staff in the finance sector will be safer than most, mainly because IT departments in banks have had a shortage of skilled IT employees for some time now.

Paul Pullinger, Head of Sales at Capgemini, says: “IT jobs are more resilient but spending on IT is generally split into two – operations and ‘discretionary spend’ on new projects and although it might be expected that new-project spending will fall, anyone with specialist IT skills in compliance and risk management [will] continue to be in high demand."

Towergroup analyst Ralph Silva believes that IT jobs in operations and maintenance are the least likely to suffer since banks are quite dependent on them. He also says:

"Other areas of the banking industry got a little bit heavy when times were good. They hired too many people. In IT, this did not happen - there were not enough people."

The situation is similar with investment banks. Stock exchange Plus Markets CTO Brian Taylor says: “I do not think IT jobs are disappearing because IT actually saves money and provides the next generation of services and products."

Peter Redshaw, research director at Gartner, warns that IT workers still have reason to worry as many companies may decide to outsource or offshore tech jobs in order to cut costs.

He does, however, believe that innovation is an excellent way to stand out in information technology and warns that there may be long term consequences for businesses that do not invest in it now:

"Customers move banks more often than they used to, and banks need to differentiate themselves and innovate. IT is one way for them to do this."

"We expect that the good times will return at some point. If you have not invested in the infrastructure, you cannot then scale up to take advantage of this. Under-investing can be damaging."

A recent Forrester research shows that companies in Continental Europe are less ready than those in the U.K. and U.S. to offshore work to India and countries with similar economies.

“We are seeing only a few large offshore deals from Continental Europe because companies there are still testing the waters and the ramp up is very slow,” says Forrester analyst Sudin Apte.

Companies in Continental Europe are very much aware of the need to offshore jobs in order to cut costs and they will offshore projects that involve 30 to 40 people and then gradually build up the numbers. They have begun outsourcing jobs only recently and the number of outsourced IT jobs has not yet reached U.S. levels.

Indian companies have begun focusing their outsourcing efforts to Continental Europe to reduce their risks in the wake of the U.S. recession scare.

The U.S. accounts for more than 60 percent of the Indian outsourcers’ income, while operations in Europe cannot yet offset the decrease in demand for offshoring from the financial services sector in the U.S.

Royal Dutch Shell is set to outsource 3,000 IT jobs – both Shell's IT staff and contractors. The company announced yesterday that it will outsource its technology and telecommunications infrastructure by signing three deals. The combined value of the deals is estimated at more than four billion U.S. dollars.

The companies that won the five-year contracts are telecommunications services provider AT&T, Frankfurt-based information technology company T-Systems, a subsidiary of Deutsche Telekom, and global IT services provider Electronic Data Systems (EDS).

AT&T will be in charge of networking and telecommunications, T-Systems will deal with the hosting and storage, while EDS will be responsible for operational integration.

The agreements go into effect in July, when most of Shell’s IT staff and contractors will be moved to the service providers. The infrastructure division, on the other hand, will be transferred to the suppliers. Shell will keep the remaining 600 IT infrastructure employers.

According to the plan, about 560 Shell employees will be transferred to AT&T, 1,500 IT employees will leave for EDS and 900 IT experts will be joining T-Systems. Shell predicts that the number of layoffs will be minimal, "20-30 redundancies" at worst.

The oil company’s information technology organization offers IT services to 150,000 clients in 100 countries worldwide. Shell’s chief information officer Alan Matula issued the following statement following the signing of the deal:

"Partnering with EDS, T-Systems and AT&T gives us greater ability to respond to the growing demands of our businesses. It allows Shell IT to focus on Information Technology that drives competitive position in the oil & gas market, whilst suppliers focus on improving essential IT capability." 

Shell’s Global IT Infrastructure and Services vice-president Swee-Chen Goh said:

"We want to look for value out of this, coming from an improved ability to focus on what drives IT in our business and access to know-how and resources in this industry. We have built the foundation blocks for success and assuming we achieve our goals there is no reason why we would not continue with the arrangement."

Wipro Technologies, the Bangalore-based global provider of technology, process and integrated business solutions plans to open a low-cost software development facility in the UK.

Depending on such factors as tax breaks, government incentives and access to science and engineering graduates, the Indian IT company will choose among several areas to open the next delivery centre. The areas include Birmingham, Manchester, Edinburgh, Warwick and Cranfield.

Wipro chairman Azim Premji says: "What we are looking for is a center which has good education facilities. That's extremely critical. And when I say education facilities I don't mean arts colleges I mean science and engineering colleges.

We want a center where the general profile of the young girls and boys graduating there is of a nature where they would like to work in that area, they have family roots in that area, they come from a background which is comfortable in that area and don't necessarily want to migrate to... the larger cities."

Wipro's UK branch has its central office in Reading, where the company employs 300 people. In line with the trend of ''reverse offshoring,'' the company has also recently opened new customer support facilities near Detroit and Atlanta.

The Indian company's aim is to recruit more people in the western countries, get higher end consulting services and increase the annual revenue by 12.5 to 15 percent over the next five years.

Premji adds: "Our objective would be to have our people force in Europe, which is resident in Europe, at least 50-60 percent local Europeans and we are rapidly driving towards that. We are dead serious about this. We want to build a local cadre. We generate a much stronger image for bidding for local contracts, which is also important."

In a similar move, Tata Consultancy Services (TCS), the other Indian global information technology services provider, has recently announced a new delivery centre that will employ 1,000 people in Cincinnati, Ohio.