MCN Direct Newswire

Vol. 7 No. 7, 19 May 2008

This issue is sponsored by:

The UK Consulting Industry Report 2008 and NCC

This issue news

1. HP joins IT services giants
2. Logica growth plans on track
3. MCA rewards niche consultancies
4. Capgemini strengthens energy and utilities team
5. Atos Origin struggles in consulting market
6. Further information - feedback/pass on to a colleague/remove from mailing list

Sponsor

The UK Consulting Industry Report 2008

We are delighted to announce that the latest 'UK Consulting Industry Report' from the Management Consultancies Association (MCA) is now available. It is based on unique data and performance metrics unavailable elsewhere.

As a consultant who needs to understand which sectors represent the best consultancy opportunities, which service lines are growing, how operational metrics are changing and the outlook for your industry in 2008 and beyond - this report will provide all of this information and more.

To find out more about the report, published jointly by the MCA and PMP, please visit http://www.pmp.co.uk/mcareport.asp, email reports@pmp.co.uk or telephone 01494 732830.

The Consulting Industry Report 2008 is sponsored by CODA.

1. HP JOINS IT SERVICES GIANTS

HP is acquiring EDS for $13.9 billion (£7.1 billion) in a bid to build its IT services business to a size that could challenge industry leaders IBM Global Services and Accenture.

The deal, which is expected to close in the second half of this year, will more than double HP's services revenue, which reached $16.6 billion in fiscal 2007.

Together, HP and EDS had total revenues of over $38 billion in fiscal 2007 (IBM Global Services achieved $54 billion) and 210,000 employees in more than 80 countries.

Mark Hurd, HP chairman and CEO who has been credited with rejuvenating the company and developing its IT services side, said: "The combination of HP and EDS will create a leading force in global IT services. Together, we will be a stronger business partner, delivering customers the broadest, most competitive portfolio of products and services in the industry."

Following the acquisition, HP will establish a business group branded 'EDS - an HP company'. It will be led by EDS chairman and CEO Ron Rittenmeyer, who will join HP's executive council and report to Hurd.

2. LOGICA GROWTH PLANS ON TRACK

Logica has reported 3.6% revenue growth for the first quarter to 31 March, providing evidence that CEO Andy Green's revitalisation plan for the company could improve growth and financial performance.

Logica's Q1 revenue reached £856 million, with the UK, last year a drag on performance with revenue lower than in 2006, stabilising to achieve revenue of £175 million. Public sector revenue rose 7% on last year's comparable quarter, but the commercial sector remained weak with revenue down 8%. Signs of potential improvement include a £40 million, five-year BPO contract with Elexon and a contract with PricewaterhouseCoopers to provide pay-as-you-go BPO payroll services for 18,000 employees and pensioners.

Green said: "The first-quarter results represent a sound start to the year, with good growth across Europe. I am pleased with the progress we are making in the UK."

Green said consultations with Logica's unions and works councils about 1,300 job losses, mainly among non-billable staff, had started as part of a plan to deliver above-market growth, funded by a £110 million restructuring programme that will deliver costs savings of £80 million a year from 2010.

Sponsor

NCC

Sustainable IT - helping you build the right roadmap for green IT

10th & 11th June 2008 - Café Royal, London

Green IT is at the forefront of the CIO agenda - are you up-to-speed with the issues? Come to 'Sustainable IT' and find out:

• How you can make sustainable IT deliver business value.
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Meet potential clients and network at the Gala Dinner. For more information see www.ncc-conference.co.uk.

3. MCA REWARDS NICHE CONSULTANCIES

This year's MCA awards have celebrated specialists in the consulting market rather than the generalists who have proved successful in recent years.

The overall winner of the MCA's annual awards and claimant of the platinum award was management consultancy Quest Worldwide for a business turnaround at automotive supplier TMD Friction Group. Quest also won the international category award for the project.

The best small firm award went to business strategist Corpra for its work at the Association of Accounting Technicians. This project also came top in the change management category.

The best private sector project award went to technology consultancy and product development company Sagentia, which also took the innovation and technology prize for its work at Vodafone. Atos Consulting won the award for best public sector project at the Department for International Development.

In other categories, Ernst & Young won the business strategy award for a project at Sony Professional Solutions Europe, while Deloitte took the human resources honours for an engagement with T-Mobile UK.

Management consultancy PIPC won the corporate social responsibility award for a project at ITV, while the winner of many accolades in recent years, PA Consulting, took the operational performance prize for its work with OGCbuying.solutions. Navigant Consulting won the outsourcing award for the negotiation of an offshore outsourcing contract on behalf of Skandia.

4. CAPGEMINI STRENGTHENS ENERGY AND UTILITIES TEAM

Capgemini Consulting has hired Martin Wells from Accenture to lead its growth in the energy, utilities and chemicals sector.

Wells will head a team of Capgemini consultants with experience of major projects at some of the world's largest oil, gas and chemicals multinationals and many of the UK's leading utilities.

At Accenture, he spearheaded teams running transformation programmes at UK utilities. Commenting on the appointment, Capgemini energy, utilities and chemicals consulting supremo John Penny said: "New opportunities and pressures abound in energy and utilities, and we are experiencing ongoing high demand from clients. The addition of Martin Wells to our team will give us powerful help in satisfying that demand."

Separately, Capgemini announced first-quarter revenues down 1.4% on last year's comparable period at €2.2 billion (£1.7 billion). The company blamed poor dollar and euro exchange rates for the decline, but confirmed its aim of achieving fiscal 2008 revenue growth of 2-5% and an operating margin of 8.5% for the year.

5. ATOS ORIGIN STRUGGLES IN CONSULTING MARKET

Atos Origin has reported financial gains in its first quarter to 31 March with the UK business returning to growth, but consulting revenue down 3% across the group.

First-quarter revenue reached €1.4 billion (£1.1 billion), up 5% on last year's comparable quarter. Consulting revenue came in at €88 million, a 3% drop but an improvement on a fall of 6% in the final quarter of 2007.

Systems integration led the revenue growth with a 7% gain to €574 million, while managed operations moved up 5% to €762 million.

Atos Origin's UK business made a 1% revenue gain. This was achieved through a 14% increase in managed operations and stable revenue from systems integration compared to last year. But on consulting in the UK, the company said: "Activity remained low, as expected, with new management needing a few months to implement all the necessary actions to achieve a full turnaround."

Elsewhere, the company's operations in France, Germany and Asia-Pacific showed strong revenue growth, while revenue from the Americas dropped 22% and the Netherlands slipped 1%.

6. FURTHER INFORMATION - FEEDBACK/PASS ON TO A COLLEAGUE/REMOVE

• For more information or if you have any feedback on MCN Direct, please email editor@ncc.co.uk
• If you wish to unsubscribe please reply/send an email stating 'Remove !*FIELD1*! from MCNDirect' to: mcndirect@pmp.co.uk.

Written by Sarah Underwood. Copyright 2008 PMP (UK) Ltd.

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