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European financial services embrace horizontal BPO services     outsourced central enterprise services of human resources, finance and accounting and procurement across retail banking, insurance and financial markets. To date it has been fragmented, dominated more by individual task outsourcing than by end-to-end function or shared service centre outsourcing.    "There is a clear move towards a more strategic view of horizontal BPO manifested through the increasing interest in cross-function horizontal BPO services and complete centralized shared service     outsourcing," says Anders Maehre, financial services analyst at Datamonitor and author of the study. "This shift is being driven by increasing vendor credibility, operational risk regulation and improved acceptance of global sourcing models."    According to Datamonitor, there is a marked move to genuine horizontal BPO services in European financial services, emphasizing cross-functionality and transformation of function processes to match best-of-class practices and applications.    Effectively this means a more complete     outsourcing of the function in question, but multi-function outsourcing too. For example Accenture's Deutsche Bank agreement which spans procurement and certain finance and accounting functions.    The shift towards strategic horizontal BPO in the market-place has in part been enabled by the growing capabilities of the vendor community. This has been driven primarily by two factors:    - M&A internally in the market segment driving greater scale and furthering the need for transformation skill-sets in the market;        - IT services companies showing commitment to the market through significant acquisitions.    Horizontal services are well suited for global sourcing as they are operationally removed from customer interactions and are often perceived to have lower immediate business impact. European FSIs continue to favour signing their agreement with onshore vendors, but are increasingly demanding that the vendor migrates the work offshore to cut costs and to carry out the transformation process        A new report by independent market analyst Datamonitor reveals that all is about to change in the relatively mature and fragmented area of horizontal business process outsourcing (BPO) in financial services.    The report, "Horizontal BPO in European Financial Services," looks at the

Consulting profits surge in strong Deloitte performance     Deloitte in the United Kingdom reported a strong performance for the financial year ended 31 May 2005. Revenues of £1,355m were up 8.8% over the previous year and profit before tax grew by 11.6% to £419m.    "The environment has been complex and the market has been very competitive. Each of our four core business divisions Audit, Tax, Consulting and Corporate Finance performed well,"        Consulting revenues reached £312m, up 6.2% from £294m in 2004.    "Our consulting strength and the differentiation this brings to our industry expertise helped to deliver good growth across most sectors but especially so in Public Sector, Financial Services, Energy and TMT. In Travel, Tourism and Leisure we advised on over 75% of the major transactions which will     shape the future of the UK Tourism, hospitality and leisure industry," said Connolly.    The firm said this year it welcomed 50 new partners, including 20 recruited from competitors, 1100 experienced hires and 850 new graduates making Deloitte one of the largest graduate recruiters in the UK.    Deloitte has also had to absorb an 11% rise in staff salaries in the     past year as a result of a shortage of qualified professionals.    Connolly said that the firm attracted a whole range of new clients from very large, multi skill advisory engagements for major corporates, significant assignments for UK Government and Public Sector, FTSE 100 and 250 audit appointments and high-growth middle market and smaller businesses.     said John Connolly, Deloitte's Chief Executive and Senior Partner.    Growth was driven by a 15.7% rise in auditing revenues to £416m and a 32% surge to £78m in consulting profits, where the company managed "a significant improvement in margins".

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