Industry news

Google has acquired Meebo a company that specialises in creating a toolbars aimed at integrating social media and displaying advertising.

The company, founded in 2005, also provides instant messaging services which allow users to access third-party services such as IM services from AOL, Yahoo and Google while browsing.

While the terms of the deal have not been disclosed, Meebo would increase Google’s social media market presence in displaying and transferring social media content throughout the web.

Wipro Technologies, the Global Information Technology, Consulting and Outsourcing business of Wipro Limited has announced the launch of ‘Wipro m-eXecute’. Wipro m-eXecute is the first ever mobility app for the manufacturing sector, developed in collaboration with SAP and caters to the niche space of manufacturing operations.

It enables the functionalities of SAP’s proprietary ‘Manufacturing Execution 6.0’ solution for iPhone and iPad users and other platforms will be added in the later releases. The solution is built on a Sybase Unwired Platform (SUP).

“Wipro m-eXecute is based on two principles - faster decision making and timely execution of transactions, and we have found that these are the two most important objectives for any manufacturer. We are happy to launch the app in partnership with SAP and have designed it to enable collaborative decision making across the manufacturing value chain”, said N.S. Bala, Senior Vice President and Global Head -Manufacturing & Hi-Tech, Wipro Technologies.

Insurance giant Prudential is set to expand with the acquisition of the US arm of insurance firm Swiss Re for £400 million.

The deal will see the UK’s biggest insurance company acquire £6.7 billion of asserts in a £400 million acquisition deal.The move is expected to add £100 million to The Prudential within the first year of ownership. Swiss Re is expected to use the profits from the sale to invest in more profitable areas.

Jackson National Life chief executive Mike Wells said, “This bolt-on acquisition is in line with our strategy and is a great opportunity to increase the scale of our life business,”

The UK government New Enterprise Allowance has provided held in launching 4,500 new businesses. New businesses helped by the scheme including a tattoo parlour, tapas restaurant and a dog grooming service.

The scheme has been running since late 2010 and was created in an effort to reduce unemployment numbers while stimulating economic growth. The scheme offers allowance of £65 a week with access to loans worth as much as £1,000, to help with start-up costs.

Employment Minister Chris Grayling said, “With 4,560 businesses up and running, we're already helping to unleash a new wave of entrepreneurs. I want to make the support available sooner so we can help even more people realise their dreams and become their own boss”.

Capita have bought Clinical Solutions, specialists in patient management software, in a deal valued at £20 million.

The acquisition would provide Capita with a high quality data centre which already provides a large quality of services to the NHS. The buyout comes on the back of a series of acquisitions by Capita over the last month.

Chief executive of Capita, Paul Pindar, commented: "This acquisition strengthens our ability to assist health services in driving down costs while providing quality patient care”.

Technology research leader Gartner has placed Arvato in Magic Quadrant for Finance and Accounting BPO.

The report focused on evaluating vendor capabilities in the comprehensive F&A business process outsourcing market among 18 different providers.

Rolf Buch, CEO of Arvato commented: “We believe such a strong placement in the Challenger Quadrant demonstrates that Arvato has the expertise and experience to both transition and deliver F&A BPO programmes of significant scale.”

A successful bid from CGI for Logica is far from certain due to the potential for failure because of the difference in size between the two companies along with expected counter offers.

The procurement of companies greater than 50 percent than that of the buyer have a high rate of failure, the size of Logica in relation to CGI make the deal unstable, particularly with CGI reporting failing profits.

Indian based firms have raised a high degree of interest in potential acquisitions in Europe and the Logica offer is unlikely to end without counter bids. Philip Carnelley, research director at Pierre Audoin Consultants, commented on the bid “CGI and Logica have almost no overlap in operations –we can think of several other IT services players who would also be a good, complementary fit.”

The Kobayashi Maru scenario or “everything I know about outsourcing negotiation, I learnt from Star Trek…”

For those not several light years into the sad zone, the Kobayashi Maru was a no-win training exercise in Star Trek, famously beaten by one James T Kirk. Though it may not be immediately obvious, there are some lessons here for businesses negotiating outsourcing deals. How? Well, in Kobayashi Maru you are:

• outmatched by an opponent

• unable to withdraw

• given insufficient resources to complete the job

• faced with Klingons off the starboard bow

Sound familiar? Maybe not that last one, but the reality that bites many organisations trying to cut an outsourcing deal is that the suppliers often have far more experience, a bigger team and more information on which to draw.

What was Captain Kirk’s solution? He reprogrammed the simulator to change the rules of the game. So what’s the ‘game’ in our world of outsourcing negotiation and how do we reprogram it?

“Simplify, simplify, simplify”

In a complex game of trade and counter trade, suppliers have the advantage: simplify the questions and concentrate on the critical elements of the deal where there is genuine room for movement. These critical elements will vary from company to company depending on the nature of the business, so it’s worthwhile investing the time up front to get agreement on those that are most important. For example, for one recent client, protection of intellectual property was critical; for another the focus was around personal data import/export limitations. Each should be a standalone discussion – don’t allow your critical elements to be wrapped into a package of trades.

“I’ll buy that service for a penny”

Avoid ‘moroccan bazaar’ approaches. Don’t take extreme positions simply because you expect to negotiate down. That simply encourages the other side to adopt the same extreme positions, extends the negotiation timescales and, again, plays into the hands of the more experienced team. Too often, clients tie themselves in knots around things like limits of liability, service credits and total amount at risk, when in the vast majority of cases agreements end up in the ‘normal’ range. Bidders know this, so don’t play the game. We advise clients to start in the ‘normal’ range and focus the discussion on what is important.

“The engines cannae take it, Captain”

Stress and brinkmanship are common negotiation tools but rarely available for the purchaser. “Head office won’t accept that clause” is almost a catchphrase during some negotiations. Assuming you haven’t adopted the Moroccan bazaar approach, your position should be reasonable and not a total departure from what the supplier market can accept, so call their bluff. Make it clear what you are doing and, if push comes to shove, wave goodbye to that bidder. Once suppliers have got over the shock, they will start to trust you to set reasonable positions and respond in kind. We supported a client who rejected a potential supplier because there were far too many ”we’d like to discuss” responses to the contract clauses. In a subsequent competition, the same supplier provided full and detailed responses with no ”reserved positions” and, eventually, won the deal.

“The final frontier?”

And, of course, remember to do all this while there are still multiple suppliers in the competition. Don’t wait until you have selected your preferred supplier before starting the hard yards of agreeing the details, because these hard yards will turn into hard miles and the “one or two details left to resolve” will turn into complete renegotiation (with the bidder having the leverage, not you).

Although the number of organisations pursuing strategic outsourcing initiatives continues to rise, numerous studies reveal that more than half of these investments fail to return the benefits executives expect; derailing an organisation, losing significant time and money in sunk investment, and in some cases harming the relationships with customers.

There are a broad range of contractual, operational, political and cultural risks that can quickly derail an outsourcing initiative. Many executives struggle to manage this uncertainty.

While there are different explanations for sourcing failures, each can be traced back to a fundamental lapse in managerial understanding, oversight and control; in affect to a failure in governance.

There are serious practical obstacles in trying to apply outsourcing governance, efficiently and continuously on a day to day basis. The first problem organisations encounter is difficulty in indentifying and analysing risks, the first step towards managing them.

Common risks: that cause failed outsourcing initiatives

• Organisations take for granted certain risks - which can focus resources on lower priority risks and ignore more critical or impacting risks.

• Certain risks exist naturally as a result of outsourcing - many organisations assume sourcing to be the same as procurement and too little attention is paid to the understanding of the wider risks.

• Risk is everywhere – but very few organisations attempt to establish a coherent view of risk.

• Risk is personal – consequences of risk are visited on all stakeholders, yet most organisations task a handful of personnel to make sourcing decisions.

• Risk cannot be delegated – regardless of whom risk is delegated to, and who may assume it, the originator is still responsible; senior management typically do not have an organisation-wide deep understanding of all dimensions of risks, and as such, cannot manage risk on their own.

• Risk is probabilistic – there are always a set of circumstances that can bring about the outcome least desired – yet very few organisations attempt to mitigate for these.

• Risk has both positive and negative outcomes – too many organisations focus on the negative aspects of risks. An understanding of the positive aspects of risks can bring about substantial additional value.

Risk management has unfortunately developed as a separate function within many large organisations, and is only today being recognised as a fundamental tenant of good governance. All too often, risk has been narrowly confined to financial and market risk. However a broader category of risk needs to be assessed and adequately managed. These broader risks include decision risk and operational risks.

The traditional approach to risk has been to view it as a negative outcome - nevertheless it is also worth stating that risk can have positive impact and an organisation must balance risk with reward. Innovation and new ideas come with risk. Without risk there would be little innovation. In this sense it is important for the leadership to provide the boundary conditions, direction and guidance that helps set the tone for appropriate risk taking.

Risk assessment and management must also be seen to be a distributed, shared activity that everyone is engaged in. It cannot be simply at the realm of a risk department, for they will have little experience of day to day operational risks. For risk assessment and management to be an enterprise activity, there needs to be a guiding hand from the senior management that provides the appetite it has for risk taking and the treatment expected of certain types of risks. Without this, anarchy will reign. The leadership must instil processes and systems for risk assessment, measurement and treatment across the enterprise.

Risk management must be one of the elements of good governance and in this sense it must be integrated with the other aspects of governance, and cannot be treated in a silo.

This feature will provide insights into the how’s whys and wherefores of developing a social media strategy that gets you connected to your customers and increases brand value.

Whether your organisation is looking at diving into social media for the first time, or is ready to expand its social media efforts, you might well be wondering: Is this something we should do ourselves, or should we hire experts to do it for us?

Social media can transform business, from engaging with customers to proving on point advertising targeted at specific demographics. The rapid expansion of social media beginning with individual users and expanding into business has become a major resource. From reaching out to individual customers and presenting a company image to delivering focused advertising, the value of well-planned social media strategy has skyrocketed in recent years.

While social media is a relatively recent platform for business, for some companies social media strategies have remained static over multiple years. The nature of technology and social media services means that platform is rapidly developing and regular strategy updates are necessary if businesses are to take full advantage of its potential.

Using analytics within social media.

Global companies and big businesses used to dominate the use of social media, however it is now increasingly valued by SMEs. Virtue, which specialises in providing social management services to global brands, have seen growth of up to 400 percent year-on-year, helped by a increasing percentage of mid-sized companies.

Richard Beattie, VP of EMEA at Vitrue, identified Social Media Management Systems (SMMS) as being used by SMEs to a greater extent: “Traditionally, it has been the Fortune 1000 companies that have utilised SMMS platforms-recently we’ve seen the emergence of mid-sized companies embracing social more”.

Four Ways to Make Social Data Work For You

Social media strategies will vary greatly from business to business. Many companies do not have the resources and time to dedicate manpower towards the updating and interaction that the effective employment of social media requires. Social media requires constant interaction and can be time consuming for those companies that choose not to use out-of-house specialists.

Raman Sehgal, owner of PR firm Ramarketing, commented: “ The golden rule for social media is if you’re going to do it, do it properly. This does not mean start a Twitter account and update it every three months. And therein lies the main barrier to the in-house approach – time”.

Effective social media strategies should seamlessly co-exist with other marketing tactics. It should provide engagement with customers, while providing insight into competitors and engaging disaffected customers while increasing presence.

Businesses need to identify and examine their goals, many will not need to outsource social expertise and technologies. Companies that are expanding with growing customer bases are much more likely to use additional resources in order to deliver an effective social media strategy. Rapidly growing businesses are also more likely to look to outsourcing such strategies to specialised companies, in order to free up human resources.

Social media strategies need to be carried out with diligence, when employing an external business to carry out a social media campaign, a clear strategy needs to be in effect before effective outsourcing can occur. Not all businesses need to outsource their social media, however all business need to ensure a well-planned and consistently renewing strategy is in place. Social media is rapidly growing and transforming, business regardless of size need to constantly engage with the social media platform if they are to reap the potential benefits.