Industry news

The UK Government have provided funding for the development of a new broadband development project from the University of Surrey, totalling £35 million.

The confirmed funding will promote the University of Surrey’s research in creating 5th generation cellular communications.

The new centre due to open in mid-2014, has been called by Professor Rahim Tafazolli of the University of Surrey, “the single biggest opportunity for the UK to regain a world leading position in the development of 5G technologies and for the development of vibrant businesses around the technologies.”

Barclays is to buy ING Direct UK after the Dutch group seeks to repay bailout loans taken during the European financial crisis.

The deal is expected to be confirmed in the second quarter of 2013 and would see Barclays acquire 1.5 million customers from the deal and increase its mortgage holdings by £5.6 billion.

Ashok Vaswani, head of Barclays retail and business banking arm in the UK, said: "We intend to maintain the high standard of service and honour the existing terms and conditions have experienced with ING Direct UK."

Research from the DatacenterDynamics 2012 Global Census has revealed that datacentre energy demands have increased by 63 percent in the last 12 months.

Power requirements have jumped from a global demand of 24GW in 2011 to 38GW in 2012, with carbon emission regulation failing to stem rising usage.

The research points towards a trend of increasing power demand, raising concerns over power availability and rising costs.

British American Tobacco (BAT) has selected BT to provide networking managed services, in a deal worth $100 million.

The contract will see the communications giant provide services to nearly 1,000 sites over 119 countries.

Networking services will include infrastructure services including, security services and remote access capability.

Phil Colman, CIO for BAT, said: "We were impressed with BT's extensive global network, its ability to improve services continuously through innovation, and its in-country resources, particularly in the Asia Pacific and Latin America regions."

With growing pressure in the public and private sector for improved asset management, organisations undoubtedly need to improve the quality, accuracy and timeliness of asset information. Relying on an annual audit – at best – is simply not good enough. Whilst many have been deterred from more frequent checks by the laborious and costly task of a manual audit, the latest generation of Radio Frequency (RFID) technology fundamentally changes the time/cost equation.

Active RFID tags are still unaffordable and unrealistic for all but the most expensive assets; but passive RFID tags cost little more than barcodes. Requiring no line of sight, the tags transform the speed and ease of scanning; organisations can both simplify the process and embark upon the more frequent audits required to improve asset management decision making.

Finance departments are becoming increasingly more accountable for the fixed asset base, says Karen Conneely, Group Commercial Manager at Real Asset Management and can benefit greatly from the use of today’s technology. From reducing annual audit fees to enabling better decision making regarding the acquisition of new assets and driving down insurance premiums, RFID tags can provide a platform for transforming the management of the asset register.

Maximising Value

As the recession continues, maximising asset value has become a core component of business planning. Any business that can minimise asset duplication, extend the lifespan of key items and reduce wastage through theft or damage can demonstrate measurable bottom line benefits.

This improvement can only be achieved with effective asset management processes; yet many organisations still struggle to routinely check and locate critical items. For the finance team tasked with valuing the asset base, changes in location, usage and disposals will often only come to light during a physical audit – which is often too late to improve asset management decision making or flag up trends in behaviour that may be resulting in asset damage or loss.

There is clearly a strong argument for improving the frequency and accuracy of the physical audit. But the traditional tool for this process – the barcode – has limitations that undoubtedly result in fewer audits being conducted.

Line of Sight

To read a barcode demands line of sight, either requiring it to be located in a highly visible position on the asset – which is not always ideal – or demanding the auditor crawls underneath furniture or interrupts individuals using equipment. Indeed, in many schools and offices, organisations have had to move barcodes from a visible location on the front of IT equipment, for example, due to risk of damage – both wilful and accidental. Yet this then means anyone undertaking a physical audit must interrupt the user to scan the barcode – either affecting productivity or, more likely, resulting in an incomplete audit. Similar problems affect care homes or the leisure industry, where organisations prefer not to publicise the use of barcodes for aesthetic reasons and opt for a less obtrusive location on valuable assets.

The time taken to complete the audit, as a result, is longer than desired. In contrast, the latest generation of affordable passive RFID tags does not require line of sight; nor is it affected by the spills and scratches that damage barcodes. And whilst organisations have been deterred from adopting RFID due to the high costs associated with active tags, the cost of passive RFID tags is now almost on a par with barcodes.

The leap forward in usability and control is significant. Depending on the quality of the scanner, a single scan can pick up all tagged items within a 2 to 3 square metre space, enabling an individual to rapidly audit each room, registering multiple assets without any interruption of staff, patients or guests. The RFID tags can be located anywhere on the asset, removing the risk of damage; and with no need for line of sight, the process is up to ten times faster than a barcode based audit, significantly reducing the cost. In addition, as each item is scanned, it can be matched with the asset register to verify not only its existence but its correct location.

Audit Frequency

When combined with effective asset management software, the passive RFID tag also provides the chance to impose control over the audit process. Organisations can lock down the system, preventing any amendments being made during the audit. By taking this approach, a company can provide scanning tools to junior personnel who can walk and scan around the building, hospital or retail store with no requirements other than the ability to provide basic location information to the system. The collected information can then be validated at a later date, using the asset management software to highlight missing or moved assets.

Alternatively, a company can empower an individual to add information during the audit process, such as the serial number of a laptop, to build a more detailed asset register. Both models have value; by providing a proactive, easy to use way of verifying asset status and location, finance can devolve the responsibility for asset management to department heads, ensuring that asset information is regularly updated and accurate to drive better decision making.

Financial Incentive

The benefits associated with more frequent physical audits extend beyond creating an opportunity to maximise asset value. With accurate, provable information on asset status and location organisations can negotiate better insurance premiums and, critically, minimise delay when placing an insurance claim. Accurate asset information also plays an important role in company acquisition and merger negotiations, ensuring the business is correctly valued.

With an accurate, up to date asset register, companies will also see the cost of compliance reduce. The ability to demonstrate that a high proportion of the assets on the balance sheet are not only on the register but actually in the expected location is a key requirement in driving down the annual audit fee.

However, the key benefit is, without doubt, the opportunity to increase asset insight. Exploiting RFID passive tags enables organisations to de-skill the process and embark on far more regular audits without incurring additional costs. With organisations across every sector, from the NHS to education, leisure to manufacturing, looking once again at opportunities for reducing costs, the spotlight is on maximising asset value: and it is those organisations that can transform improved accuracy and timeliness of asset information into better decisions that will extend asset life, reduce wastage and deliver measurable bottom line value.

How will a multi-national company benefit from outsourcing parts of its operation to Egypt post the Egyptian revolution? I hear this question being asked by investors looking to outsource their business operations. At ITIDA, we’re confident that Egypt’s location, solid infrastructure, cost benefits and talent set it apart and continue to make it an ideal outsourcing destination for multinational companies.

Following on from my last post, Building on stability for growth, I want to take a quick look at each of these attributes in turn and explain how they make up Egypt’s value proposition. Beginning with its geographic location UK Trade and Investment recently described Egypt’s location as “hard to beat.” At the crossroads of Europe, Africa and Asia, and with flights to European cities being on average only four hours, Egypt is ideally connected to international markets.

An additional geographic benefit is that the world’s major subsea telecommunications cables run along the north coast of Egypt, making phone and internet access quick, easy and highly competitive in terms of operational cost. Our infrastructure and connectivity is scalable and the country is presently investing in network upgrades to offer fourth generation broadband.

We provide a great infrastructure with world-class business hub facilities. Smart Village, just outside Cairo, currently accommodates the needs of over 100 companies and 22,000 professionals in high-tech facilities and expects to host over 600 companies and 100,000 professionals by 2014. Investors include Microsoft, Vodafone, Ericsson, IBM and Alcatel-Lucent – successful multinationals, with high expectations who remained throughout the Egyptian revolution. Adding to the success of the Smart Village, a new 35,000 seat development for Contact Centers is now open at Maadi Park in Cairo, hosting major centers such as Sykes and IST, in addition to large local vendors Xceed and Raya.

The cost of doing business in Egypt remains highly favorable, and despite some investor skepticism, economic outlook is positive. This year Egypt saw continued growth in the ICT market with the industry reaching $1.4 billion in export revenue and gaining recognition from international organizations such as the United Nations Conference on Trade and Development (UNCTAD). This continued growth and recognition from key industry experts reaffirms Egypt’s confidence of achieving IT export revenues of $10 billion by 2020.

What I am most proud about, and what lies at the heart of Egypt’s outsourcing offer, is its talent. We benefit from a strong, sustainable pool of home-grown talent that is technologically skilled, multi-lingual and entrepreneurial. Egypt produces more than 425,000 graduates each year with around 60,000 business and commerce graduates, and 31,000 fluent in western languages.

ITIDA works closely with local universities and multinational companies to provide students with world-class training. This year Future University Egypt joined SAP’s acclaimed University Alliance Program. We also launched a Technology Innovation Center in Cairo and a Graduate Program to drive communication and technology innovation in Egypt. In addition to these developments, as part of the EduEgypt initiative, the country has created around 28,000 BPO and ITO training graduates, and 200 certified BPO trainers – skills ready and waiting to be utilized by business.

I am very pleased that the National Outsourcing Association has acknowledged ITIDA’s efforts to educate the next generation, by shortlisting us in the Skills Development Programme of the Year category at this year’s NOA Awards.

The appointment of a democratically elected president has brought an increased confidence to Egypt and I hope this short snapshot helps to demonstrate that Egypt is experiencing a period of renewed stability and growth and continues to be an attractive global outsourcing destination. I’m keen to hear your thoughts.

The Sourcing Specialist 2 – IT Hardware

It time for the second of our Sourcing Specialist guest blog posts. Alun Morris, Sourcing Consultant at Wax Digital, outlines the nuances of sourcing common but non-core spend categories, that often get overlooked in the mêlée of driving best value from core business spend. This week: IT hardware.

The spectre of Moore’s Law, coupled with greater IT purchasing choices and the impact of trends like BYOD has revolutionised IT hardware sourcing.

What brand of system is going to deliver the right performance and the right price has little individual bearing on the sourcing team’s success. From building data centres, to co-location, to cloud, understanding the respective merits of different approaches and balancing interrelated factors such as real estate, support, maintenance and obsolescence is now critical.

Of course there are many (and growing) choices of IT supplier that can provide the full solution. Even if this approach is your final choice, being able to deconstruct the category and look at its component parts when sourcing is good practice for achieving best value.

Assessment of market forces, such as steel price changes, shortening product lifecycles and the total cost of owning IT versus virtualisation or rental are also vital. It goes without saying that sourcing must work in partnership with IT so that best value decisions are based around strategy and objectives. Consideration must be made for issues like information security, business process efficiency and staff productivity too.

Due to IT becoming an increasingly service orientated market it’s important to know exactly what you are paying for and if its matches your needs. Best value may well be achieved from a single IT solution provider providing products, installation, training and maintenance. But there can be many variants in service levels and these must be clearly identified to properly evaluate and compare options during the tender process.

Of course many organisations’ IT departments already have relationships with an array of IT resellers and vendors; these should be respected if they are strong and successful. However existing suppliers should also be invited to compete for business. eAuctions are effective here as they allow hardware requirements to be split into lots in order to source critical inventory at best price.

As we saw with IT Consumables there are many deciding factors and total cost considerations that impact what really drives best value in IT hardware. Casting a wide net initially helps you to evaluate different approaches. Then once your preferred model is chosen applying tactical sourcing skills will ensure the right balance of business value and performance.

Next time: Professional Services.

In the meantime you can find out more about sourcing IT hardware and other non-core categories in this ebook dedicated to the subject.

Outsourcers increasingly need to deliver on outcome-based contracts. Provision of a service alone doesn’t necessarily cut the mustard. This means rethinking the service design and the engagement of audiences. Part of this is proposition development, says Peter Mills, strategic planning director at The Team.

Propositions are misunderstood. It’s marketing jargon gone crazy, of course. Some put this down to the whole offer, soup to nuts, everything we do. Others say it’s the pithy line that sums it all up: the strapline, the boilerplate, the slogan.

I think we should see proposition development in the round. We have an audience. They have a need, perhaps latent. How do we understand how they would respond to our offer and do the thing we want them to do? Do we have to change our offer to make it more engaging and effective?

What kind of thing are we talking about? It could be getting people to use less expensive, more effective channels, such as online services, over existing face-to-face services, or new employee appraisal systems, or registering for a service they don’t particularly want to use. It may be doing something they want to do, like reserve a book in a library, or something they don’t want to, like pay a fine.

We start at the beginning: the brief. Is the issue identified the right one? Are the audiences fully understood? Are existing messages what people really hear? How do we know that? Are these the most effective communication channels? How will we know we have been successful? Once these questions are answered, or at least explored, we need to agree an approach for coming up with the proposition.

Our preference is for a co-creation approach. It’s immediate history lies in online development. Although web technology was seen by many as a fantastic innovation, making money out it proved difficult to start with, partly because people just found the ‘experience’ just all too difficult. Co-creation, working with others to create something, is just so more effective than not working across both experts and users (who you should see as experts in their own right). It encourages improved buy-in and corporate memory. It is insight- and evidence-based. It exploits creative minds more fully, whoever they may be. It brings about advocacy and opens up networks.

This approach, therefore, needs open-mindedness, willingness to hear inconvenient truths and commitment to attention to detail. Committing to these things together helps better creative thinking.

Successful concepts come about because their creators understood their audience better than the audience themselves. How people frame their worlds and respond to norms is not necessarily conscious. Getting under people’s skin by reviewing existing research, carrying out fresh research where gaps are apparent, being imaginative in the design and execution of the research to truly understand motivations and willingness to change perceptions or behaviour, and checking channels and influencers provides a sound foundation for crisp proposition development and creative conceptualisation.

Wherever possible we develop pen portraits or personae against which we can continuously test our thinking. This means we have ‘the audience in the room’ and allows those not involved in the co-creation development directly to appreciate the thinking and rationale.

This is how we do it.

We understand the problem – for example, some people are not very good at doing something, but they need to. We get to appreciate why people are reluctant. Are people informed by myths and untruths? There may be a primary resistance, but this may be beyond our immediate influence, such as cost, or timings, or penalties, but there could be supplementary resistance or behaviours that we could influence, such as normative behaviours – I don’t do something because none of my friends do – or cultural framing. Propositions can be developed that recognise more latent ambitions and motivations and then tested using pen portraits and then in wider, more conventional environs, such as focus groups.

Propositions can be developed, and increasingly so, with a wide variety of invited expertise in the same room through facilitated workshops. These may already be within our own team, but also within the client’s team, although not necessarily in the direct client group, within customer groups and other ‘stakeholders’ – people with an interest in helping your target audience achieve your goals. The groups should be facilitated so that all ideas surfaced are captured, everyone gets to play a part and stimulus is loose enough to encourage development.

The ideal result of this activity is something you can prototype and test. It doesn’t have to be a full blown pilot, just something that is sufficiently realised that the process people need to go through are apparent and can be critiqued and improved.

Edinburgh Airport has outsourced its IT infrastructure to Onyx, in a five year contract worth £3million.

Onyx will provide infrastructure services including cloud services, networking support, datacentres access and 24-hour support.

Head of IT at Edinburgh Airport said: “It is vital for us to have the IT capacity to support business growth, and the ability to implement the best technological solutions and quality of service for our passengers and airlines.”

A survey from cloud management specialists Zenoss revealed that only 18 percent of the company’s user community had deployed open source management platforms.

While open source services have become increasingly prevalent within the cloud marketplace, the survey by Zenoss has revealed that such services have yet to be fully adopted by the IT community.

While reports of failing in security and limited support were given for reasons of avoidance, the report revealed that 43 percent of those polled planned to adopt open source computing platforms in the future.