MCN Direct Newswire

Vol. 6 No. 1, 15 January 2007

This issue is sponsored by:

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This issue news

1. Accenture makes record revenue
2. Public sector wastes money on consultants
3. Mike Rake knighted in New Year's honours
4. Honda drives quality with IBM
5. Atos Origin secures CSC executive to lead UK
6. Further information - feedback/pass on to a colleague/remove from mailing list

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1. ACCENTURE MAKES RECORD REVENUE

Accenture has reported record first-quarter financial results, driven by double-digit growth in both its consulting and outsourcing operations. Accenture's net profit rose 32% in the quarter to 30 November to $284.2 million (£145.9 million). Revenue climbed 14% - above the company's expectations - to a record $4.8 billion.

Accenture said its consulting revenue grew 13% to $2.9 billion in the quarter, with outsourcing up 16% at $1.8 billion.

CEO William Green said: "We had a tremendous first quarter, with our outstanding top and bottom-line performance demonstrating continued success in executing our strategy. We exceeded our overall revenue expectations, achieving solid growth across nearly every dimension of our business. With $5.5 billion in new bookings, we are seeing sustained demand for our services, particularly in consulting."

Accenture recorded exceptional performances from its financial services, products and resources operating groups. Its three geographic regions also broke records, with the EMEA region up 15% at $2.3 billion, the Americas up 13% at $2.1 billion and Asia-Pacific up 19% at $361 million.

Looking forward, Accenture expects its full fiscal 2007 revenue to grow between 9% and 12%.

2. PUBLIC SECTOR WASTES MONEY ON CONSULTANTS

Public sector spending on consultants reached £2.8 billion in 2005/6, according to a National Audit Office (NAO) report - but while the sector showed some improvement in its use of consultants, it is still failing to assess the need for such advisers correctly.

Spending on consultants in the public sector rose by 33% between 2003/4 and 2005/6, largely because of increased expenditure by the National Health Service. But spending of £1.8 billion on consultants by central government showed a slight decline. The NAO attributed this to reductions at three large departments, rather than a wider trend across government.

The auditor's report on the Government's use of consultants acknowledged: "It is not possible to make an overall assessment of the benefits that have resulted from the money spent on consultants, partly because departments rarely collect information on what has been achieved."

The NAO warned that most departments do not make a proper assessment of whether internal resources could have been used instead of consultants; do not collect adequate information to improve buying decisions; do not actively engage with consulting firms to understand how they work; and do not regularly carry out the transfer of skills from consultants to internal staff.

The NAO believes changing some of these habits could improve efficiency in the use of consultants by around 15% in the first year (saving £270 million), rising to around 30% (saving £540 million) in the third year.

NAO head Sir John Bourn said: "Departments need to think ahead about what skills they should have, so they don't have to rely on consultants year after year. They should examine whether they really need to use consultants quite as much as they do, a move which could release substantial sums for front-line services."

3. MIKE RAKE KNIGHTED IN NEW YEAR'S HONOURS

Mike Rake, chairman of KPMG International and head of KPMG in the UK until last October, was knighted in the New Year's honours list for services to business and the accountancy profession.

In his role as chairman and senior partner of KPMG UK, Rake developed the company's advisory practice as well as its audit and tax businesses. In the year to September 2006, advisory revenue rose 23%, ahead of tax on 13% and audit on 2%. The advisory practice is not expected to replicate the scale of the business and IT consultancy that KPMG sold off in the break-up of the ex-Big 6, but it is gaining traction in a business world worried by globalisation, competition and stringent regulation.

Rake said: "I am naturally proud and delighted to receive this honour. The honour doesn't only reflect my services, but also those of many people within KPMG and the wider accountancy profession with whom I have worked." He has been at the forefront of recent regulatory changes affecting business both in the UK and globally, and has pressed for strong independent regulation, transparency of operations, empowered audit committees and the need for global accounting standards.

4. HONDA DRIVES QUALITY WITH IBM

IBM Global Business Services has won a contract from Honda for an RFID (radio frequency identification) project designed to transform motorcycle and scooter production at the manufacturer's plant in Atessa, Italy.

IBM business and IT consultants have been working with Honda Italia engineers to develop an RFID solution that will enable real-time automatic identification of each vehicle in the production chain. RFID tags will also be used on micro-lots of key components such as engines. Following implementation, the RFID solution will be integrated with Honda's existing IT systems.

Augusto De Castro, vice president of the industrial sector at IBM Italy, commented: "This is an example of how innovative technology can enable a significant business transformation providing real value to a client."

Honda is worldwide leader in the powered two-wheels market and calls the RFID project an "extremely important and fundamental step in our 'outstanding quality' innovation production strategy". Honda expects this initial project to act as a catalyst for further RFID-based innovation in areas such as the supply chain and after-sales services.

5. ATOS ORIGIN SECURES CSC EXECUTIVE TO LEAD UK

IT consultancy Atos Origin has hired Keith Wilman, CSC's former head of operations in the UK, Ireland and Netherlands, to become its UK chief executive.

Wilman joins Atos Origin immediately and will report to management board member Wilbert Kieboom. Kieboom took over responsibility for the UK following poor performance in last year's third quarter.

Wilman's remit is to strengthen Atos Origin's UK operating model and improve organic growth. He has been in the IT field for over 25 years, most recently at CSC and previously at Easams and GEC.

Atos Origin CEO and chairman Bernard Bourigeaud commented: "The UK is a key market for Atos Origin and we are delighted to welcome Keith Wilman as the new CEO for our UK operations. His experience and expertise will be invaluable as we strive to differentiate ourselves to further strengthen our business and increase profitability in what is one of Europe's most competitive markets."

Wilman joins Atos Origin after a series of big contract wins in both the private and public sectors.

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Written by Sarah Underwood. Copyright 2010 PMP (UK) Ltd.