Just another WordPress weblog
Posted on January 5, 2011 by AtulNo Comments
Outsourcing Resolutions Vendors Should Make in 2011 – Services – Business Issues. By Stephanie Overby
Think it is right to kick off 2011 with some resolutions. Suggest buyers look at these too since they can do the same!
Posted on September 9, 2010 by AtulNo Comments
I am posting this as I believe that thus is overdue!
Oracle to Acquire Major IT Services Firm, In Our Opinion.
Last month, we hosted a survey on which company Oracle might acquire next. If you missed it, be sure to check out the results in our post, “Oracle Mergers & Acquisitions: Who’s Next?” We had a great turnout with over 1,250 industry experts sharing their predictions. Among the more substantiated claims was the prediction that a global systems integrator like Capgemini could be a logical fit for Oracle. Now that Mark Hurd has joined their executive team, we think it’s all the more likely that Oracle will make a major acquisition in the IT services market.
By acquiring the consulting arm of PricewaterhouseCoopers in 2002, IBM solidified its dominance over the global technology services industry. Hurd’s acquisition of EDS in 2008 was seen as a direct assault on IBM Global Services, making HP the strongest contender for IBM’s throne. Now, Hurd is essentially competing against himself, facing not only IBM but also the very beast that he created, HP Enterprise Services. Can he achieve for Oracle what he has already achieved for HP?
If so, Hurd will have more than one option to choose from. Capgemini has a relatively low P/E, and its recent acquisition of a majority stake in CPM Braxis, a leader in Brazilian IT services, makes it an even tastier morsel. However, there are many other fish in the services sea, so we’ve decided to look at several other services providers as well. Which of these do you think Oracle should go after? Leave us a comment below.
Indian IT: Just to Name a Few
For the past two decades, India has been a major player in the global IT services market. A number of highly successful Indian companies emerged during the Y2K boom, and a few of them have grown to become multi-billion dollar businesses. Three particularly well-regarded companies are:
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A company that started out with $250 and grew to become a $5 billion global consulting and IT services provider. Last year, it became a member of the Global Dow, which suggests a strong global influence that might be appealing to Oracle.
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Initially responsible for providing computer services to its more established sister company Tata Steel, Tata Consultancy Services is now the largest IT services provider in Asia. Throughout the last decade, Tata completed a series of well-placed global acquisitions that helped the company gain entry into major markets around the world.
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Emerging in the 1980s from what was once a vegetable products factory, Wipro is now a major competitors in IT services and consulting. In recent months, Wipro and Oracle have collaborated quite frequently, as Wipro has drawn upon its history in factory production to develop solutions with Oracle for the manufacturing industry.
However, forming a relationship with one of these companies may bring more problems for Oracle than solutions. Over the past several weeks, many of these Indian IT companies have been fighting against new U.S. government regulations that will add thousands of dollars in new fees. Now, any company with more than half their U.S. workforce on visas will be forced to pay these fees, and spokespeople from Infosys and Wipro have already announced that this legislation could have a significant impact on their operating margin. This is just one example of the many unique issues Oracle would face if they go after one of these overseas companies.
Some Homegrown Alternatives
There are also plenty of American options, some of which match the global influence of the aforementioned Indian companies while offering much smaller pills for Oracle to swallow. Whereas the previous three Indian companies have P/E ratios of 23x-30x, two of the following three American services providers come a little cheaper.
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This consultancy serves 96 of the Fortune Global 100 companies, making it the kind of global player Ellison and Hurd will need to compete with IBM and HP. However, Accenture is more than just IT services; its management consultancy arm is responsible for much of its success. Would Oracle want to acquire elements that it may not need? With a $27 billion market cap and a 16x P/E, Accenture is certainly well within reach.
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This Pennsylvania company would be an even easier target for Oracle. The company’s revenue has declined in recent years alongside the proprietary mainframe systems market that once made it successful. When equipment sales took a hit, the company’s market cap fell precipitously, forcing them to shift their focus to services. With revenue under $5 billion and a meager 5x P/E, Unisys may be too small to frighten IBM and HP.
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In contrast, Cognizant has been one of Fortune’s 100 Fastest Growing Companies for seven years. Their performance is frequently praised, and their revenue grew 16% in 2009. At this rate, Cognizant will strengthen its value and become an increasingly pricey acquisition. With a 32x P/E, time is running out for Oracle to bring this proven commodity into its fold and mount a serious campaign against its competitors.
Filed Under: Global Work, Manager, Trends
Posted on May 24, 2010 by AtulNo Comments
Why Chief Information Officers Are Second-Class Citizens Among Top Executives – WSJ.com.
I have been working with CIOs since 1991 and have come to admire many of them. CIOs at Applied Materials, Ron Kifer and Jay Kerley; CIO at Family Dollar, Joshua Jewett; CIOs at P&G, Fedex and others are not just senior leaders, they are helping transform their firms. They are leading key initiatives.
While the articles has good pointers for CIOs on how to better evolve their future careers, wish they had talked to one of the above to show how many are already doing it!
Posted on June 23, 2009 by Atul1 Comment
Even if a client organization
recruits and retains the best global talent, that talent has to be
managed. And managing across
borders is a complex job that requires a special kind of manager – a
globally-savvy one.
Yet just as there is a
shortage of other global talent, there is an even higher shortage of
globally-savvy managers. Because many
traditional managers may not have the skills necessary to become excellent
global managers, some organizations resort to poaching globally-savvy managers
from their competitors. But that’s
not a viable long-term solution to the management talent shortage. To succeed globally in the long-term,
client organizations need to learn how to find and/or develop their own
globally-savvy managers.
Portrait of a globally-savvy manager
There are certain key
competencies that are required to succeed as a global manager – certain key
qualities that globally-savvy managers have in common. They include:
Globally-savvy
managers don’t just cope, they adapt.
Surveys have demonstrated that the inability to manage change is one of
the most significant barriers to a successful global sourcing initiative. So a globally-savvy manager will not
only know how to manage change, but how to communicate the benefits of that
change to the appropriate decision-makers.
Globally-savvy
managers have a broadened mindset.
They can look across situations, business segments, and cultures and
focus on the commonalities rather than the differences. They think globally when considering
business opportunities and account for cultural differences.
Globally-savvy
managers have the ability to lead well across different cultures. They’re most often strong leaders, and
have an affinity for adjusting well to unfamiliar situations. They understand that cultural
differences are complex and have the potential to derail a sourcing initiative.
Some
organizations look to managers from the sourcing location for their
understanding of the complexities of working globally, knowledge of the local
cultural landscape and network of strong relationships in the sourcing location
(for example, the client may hire a Filipino living and working in the U.S. as
the global manager for an offshoring initiative to the Philippines).
Or
the client may hire an American manager who has experience as an expatriate for
her knowledge of the U.S. business culture and global experience as an
expatriate. Ideally, client
organizations will blend the two approaches, says Lori Blackman, Founder and President
of human capital consulting firm DNL Global.
Globally-savvy
managers are not only good at managing relationships across business segments
and cultures, but they also know key individuals within the organization. Globally-savvy managers establish and
maintain active networks and strong relationships.
Globally-savvy
managers can engage and motivate their employees – even those who are thousands
of miles away. They also
understand how to develop local talent – instead of relying on more expensive
and sometimes less effective expatriates.
Some globally-savvy managers
seem like they were just born that way – they’re out there for the organization
to find. Finding them is about knowing
the indicators of a globally-savvy manager – understanding the qualities that they
possess.
But globally-savvy managers
can also be developed from within the organization. Key steps to developing them include:
Developing
programs that offer managers the opportunity to work outside the organization’s
home country – through expatriate programs or temporary assignments abroad – can
be a first step in developing the adaptability and cultural agility that are so
important in a global sourcing manager.
But
bi-cultural expatriate and temporary work-abroad assignments may not help
managers develop the necessary global mindset. To foster that development, organizations should work to
create global teams – to internationalize their ranks. That can allow for global learning
opportunities on both the institutional and the individual levels.
Organizations
should invest – from the top down – in programs to create global leaders. Global leadership factories can be
semi-formal internal programs or formal educational opportunities outside the
company.
Corporate
education programs are great places for managers to develop global leadership
abilities – picking up relevant skills and learning from others’
experiences. The programs are also
great places to build networks and absorb global culture and values.
From knowing how to identify
a globally-savvy manager to how to develop one, the ability to create a global
leadership team with the qualities of the globally-savvy manager is essential
to the success of any global sourcing initiative. As important as other aspects of talent management are in
their own right, the client needs a globally-savvy manager to lead the
initiative to success.
- Atul Vashistha
Filed Under: Manager
