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Accenture moves up in HR BPO market share with 10-year BT deal
 
 British Telecom and
Accenture have signed a
10-year, $575 million
(GBP306 million) business
process outsourcing (BPO)
contract for human
resource (HR)
administration services.
   According to research
from the Yankee Group,
the deal puts Accenture's
market share in the HR
BPO space at 16% - just a
percentage point behind
current market leaders
 
  
   
 
 
 
 
 
 pensioners only the UK.
Under the new contract,
Accenture will also
provide services to
another 10,000 BT
employees in 37 countries
around the world.
   The services to be
provided under the new
contract include customer
contact/call centre,
recruitment, pension
administration, payroll
and benefits
administration,
 
 performance management
administration, health
and safety, and HR
advisory and information
services.
   The new contract will
take effect August 1,
2005, and it will be
preceded by a jointly
developed transition
program to define the
service delivery
framework.
   Two of Europe's
incumbent telecom
 
 operators, BT and Telecom
Italia, have now adopted
HR BPO services and both
of them partner with
Accenture HR Services.
Globally, communications
providers such as Nortel,
Lucent and Avaya are also
engaging with outsourcing
their HR processes to
companies such as
Convergys, Hewitt and
ACS.
  
 
 Hewitt Associates.
   The contract
significantly expands the
geographic reach of
services that Accenture
has been providing to BT
under a previous
five-year contract, which
covered employees and
 
 
EDS not looking to sell A.T. Kearney
 
 While EDS posted
higher-than-expected
quarterly profit, its
consulting business, AT
Kearney, posted an
operating loss, as the
company continues to
struggle to integrate
Kearney's high-end
advisory business into
its IT and outsourcing
operations.
   A.T. Kearney posted an
operating loss of $17
million on revenues of
$193 million for the
fourth quarter of 2004.
Its full-year results are
yet to be released. In
2003, when it was granted
greater autonomy from EDS
in an effort to win back
clients, it lost $7
million on revenues of
$846 million.
   Speaking to analysts
EDS Chairman and CEO
Michael Jordan said he
 
  
   
 
 
 
 
 on growth initiatives
including an acquisition,
expanding in low-cost
countries and investing
in technology.
   Analysts expect that
2006 will be another
difficult year for EDS,
as it bids to keep its
largest customer, General
Motors Corp.
   Investors were
concerned by a decline in
revenue, a big shortfall
in new contract signings,
and the company's
unexpected weak earnings
forecast for the first
quarter and all of 2005.
   New contract signings
fell to $US3.8 billion
from $US4 billion as some
deals that had been
expected to close in the
fourth quarter were moved
to the first quarter.
  
 
 expects A.T. Kearney to
show "a little bit of a
rebound this year, but
not much. I think most of
the high-value consulting
companies are struggling
a little bit."
   While many analysts
view Kearney, or large
parts of it, as prime
candidate for sale,
Jordan was adamant the
consultancy was not for
sale, calling published
reports that EDS was
shopping Kearney
"completely erroneous."
   EDS is trying to
expand outside its
slow-growing core
business of IT and Jordan
said EDS would spend more
than $1 billion this year
 
 
IBM expands consulting unit with new acquisition
 
 In a move to strengthen
the finance and
administration
transformation services
offered by its consulting
unit, IBM will acquire
Equitant for an
undisclosed sum. IBM said
it is paying a "fair
market value" for the
company.
   Equitant, a provider
of business
transformation
outsourcing services, is
a private company with
operations in Dublin,
Ireland and Stamford,
Connecticut. It has been
reported that all 200
Equitant employees will
move to IBM.
   Citing research from
IDC that the finance and
accounting business
process outsourcing
services market will
 
  
   
 
 
 
 
 reach $16.5 billion this
year, IBM has said it is
focusing its efforts
towards strengthening its
business transformation
services and that it is
open to making similar
acquisitions in the
future.
   Equitant was created
in 1987 to provide
working capital
management to large
corporations and has
since evolved to focus on
consulting customers how
to manage the
order-to-cash cycle. The
company counts Cisco
Systems, Hewlett-Packard,
and Microsoft among its
clients.