Industry news

An article in the Economist this week explains why Indian ITO companies need to change, adapting to market forces. The rise of RPA and AI technology and the inauguration of President Trump create headwinds for the outsourcing companies based in India. Increasingly, focus has moved towards research and development but Indian firms have a long way to go to catch up with western rivals. As globalisation is threatened, companies that built themselves off its opportunities find themselves weakened by its suppression.

Arvato has been recognised as one of the UK’s best apprentice employers by the National Apprenticeship Service. The business process outsourcing (BPO) partner, which works with several public-sector organisations and international businesses in the UK, including Renault, BMW and Slough Borough Council, has been featured in the annual Top 100 Apprenticeship Employer List. Inclusion recognises those organisations with the highest standards of excellence in employing apprentices. Debra Maxwell, CEO, CRM Solutions, Arvato UK & Ireland, said: “Apprenticeships not only provide an important route into the workplace for young people, but they deliver a fresh source of ideas and can help build up the skills sets and talent organisations need for the future.” To read about the awards, click here.

Luton Borough Council has extended its strategic partnership with Civica, a market leader in software applications, digital solutions and outsourcing, with a new ITO contract which will support the council’s drive to transform digitally and deliver continuously improved services for residents. The partnership will support Luton as it delivers a £1.5 billion investment framework package into the borough. “Civica will deliver the IT services and flexible infrastructure required for us to achieve our digital ambition to revolutionise the way that residents access services. More of our offerings will now be automated and available 24/7 online, allowing for rapid self-service. And everything is secure by design so we and our users can do so with complete peace of mind.” says Trevor Holden, Chief Executive, Luton Borough Council. To read more about Civica, click here.

After the unveiling of a new industrial strategy, focused on infrastructure, training and research and development, the government appears to be addressing a problem that has persisted in the UK economy since the financial crisis of 2007-08, low productivity growth. Ash Merchant, Fujitsu’s Director of Education comments “It’s encouraging to see the Government intends to boost STEM skills, digital skills and numeracy as well as set up specialist institutions. It’s a sign that the conversation is moving onto more granular and specific skill sets that will become more and more valuable to the UK economy in years to come. However, the challenge that will come to the fore is who will teach the students these skills?” Now that the government is making the right noises, we await action. To read more, click here.

A lot of news this morning surrounds the inauguration of President Trump and his effect on the sourcing industry. Mr Trump’s statement of ‘America first’ has put a lot of worry into major outsourcing destinations such as India and the Philippines. Nasscom (The National Association of Software and Service Companies) of India has warned Trump of the dangers of reducing outsourcing. Nasscom President R Chandrasekhar said the US lacked the high-skill workers required to keep the country’s economy “globally competitive”. To read more about the NASSCOM warning, click here.

According to Computerweekly.com, cloud-based contracts made up a third of IT outsourcing contracts in 2016. Using the information gathered by ISG it was found that a quarter of total spending on IT and business process outsourcing contracts was on cloud-based services, or as-a-service contracts. John Keppel, president at ISG, welcomed the emergence of as-a-service contracting “Although growth in the use of these new technologies and services has been slow to take off in EMEA, we expect to see the impetus around these systems build in the region as public cloud providers expand their datacentre footprint across Europe,”. To read the article by ComputerWeekly.com, click here.

Prime Minister, Theresa May, will be unveiling a more interventionist business strategy today to help the UK economy as negotiations begin on Brexit. The plan is expected to include information on topics such as investing in science, research and innovation, encouraging trade and inward investment, developing skills and upgrading infrastructure. The hope is that the plan will help new technologies such as smart energy, robotics, artificial intelligence and 5G mobile network technology. To read more, click here.

Information Services Group (ISG), a leading global technology research and advisory firm, released its Q4 2016 EMEA ISG Index, which reveals that growth in as-a-service sourcing accelerated across the region in 2016, driven by the increasing demand for digital solutions. The EMEA ISG Index, which measures commercial outsourcing contracts with an annual contract value of €4 million or more, shows that combined ACV in the (EMEA) market reached €11.8 billion in 2016, up 2 percent on 2015 totals. While traditional sourcing value in the region slumped to its lowest point since 2009, as-a-service ACV climbed to just over €3 billion, up 33 percent over the previous year.

Symphony and Celaton announced a global partnership to offer enterprises an end-to-end solution for implementing and managing core automation processes. Celaton, which is an artificial intelligence (AI) software company, will join Symphony’s Digital Ecosystem, a platform that enables customers to construct comprehensive automation solutions using best-in-class tools and methodologies. As part of Symphony’s Digital Ecosystem, Celaton’s AI solutions will expand the scope of business automation to handle complex, unstructured processes. This addition complements existing tools such as robotic process automation (RPA). To read the full report, click here.

Reaction continues to pour in after Prime Minister May’s speech on the future of the UK after Brexit earlier this week. CEO of Houghton International (a high voltage coil manufacturer), Michael Mitten, said “Regardless of the UK’s position in the EU, we will continue to be, open for business internationally. Nothing has changed yet and it’s unlikely that it will for at least a few years – at the moment it is very much business as usual for us.”

Robert Barbus, Operations Director of Soitron Group said “Brexit has brought upon many uncertainties, and the potential IT skills gap is a very important one. Ultimately, it depends on what trade and immigration agreements are made between the UK and other EU countries. If they remain similar to the current EU agreements, then the level of skills provided by non-UK EU workers will remain broadly the same. However, if EU workers have to re-apply for visas or are limited in numbers, this is when we will see a skills gap develop.

More on Brexit by sourcingfocus.com