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Sitel's New Commercial Model Bears Fruit Following Transformational Contract Win with TDC
Sep 16, 2014, by NelsonHall AnalystSitel has been awarded a two year 800 FTE CMS contract by Danish telecom provider TDC, following an initial contact that was made with twelve potential suppliers in November 2013. This is TDC’s largest foray into outsourcing its CMS function by agent number and by total value, with headcount representing approximately one third of total CMS capacity. The contract includes the transfer of [...]
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Cognizant Acquires TriZetto to Add ISV Business to its Healthcare Business
Sep 15, 2014, by Dominique RaviartCognizant is to acquire TriZetto, a healthcare ISV in the U.S., for $2.7bn in cash. TriZetto has a headcount of 3.7k (Cognizant at end of H1 2014: 187k.4). In its last 12 months, TriZetto had $711m in revenues and a non-GAAP operating margin of 18.4% (Cognizant in 2013: 20.6%). TriZetto LTM revenues breakdown by service/product line is: Payer software: 40% (~$277m) Consulting: 23% (~[...]
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Software Testing Spending Growth Accelerates in 2014
Sep 15, 2014, by Dominique RaviartTCS, Infosys and SQS have recently published their calendar Q1 and H1 2014 revenues, and provided financial details on their software testing revenues (see notes below). In calendar H1 2014 (all numbers below are constant perimeter NelsonHall estimates): TCS: revenues were ~+24% to ~$612m (H1 2013: ~+23%) Infosys: ~+21% to ~$395m (H1 2013: ~+15%) SQS: + 9% to €129m (~$174m) (H1 2[...]
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U.S. Employers Evaluating Benefit Plan Strategies
Sep 15, 2014, by NelsonHall AnalystLast week, Mercer released preliminary results from its annual national survey of Employer-Sponsored Health Plans 2014, which discussed health benefit cost expectations for 2015. Some of the key findings of the survey included: Health benefit costs per employee will increase ~3.9% on average in 2015 or ~5.9% if employers make no changes to their health plans for 2015 Around 32% of em[...]
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The "New Concentrix": a Different Type of Player in CMS BPO?
Sep 12, 2014, by Rachael StormonthConcentrix recently briefed NelsonHall about its positioning now that it has essentially completed its acquisition of the former IBM BPO capabilities around customer management services and also some industry-specific services (excluding mortgages, which IBM retained). For details of this acquisition, see "IBM Exits CMS and Most Industry-Specific BPO: Divests Business to Synnex Corp" at:[...]
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Alliance Data Buys a Winner with Conversant
Sep 11, 2014, by Andy EfstathiouAlliance Data is to acquire Conversant for $23bn to expand its digital marketing services capabilities. The acquisition will be paid for half in stock and half in cash (at tendering shareholders' discretion). Post closing, Conversant will operate as a part of Epsilon, a digital marketing services division of Alliance Data. The transaction is expected to close in Q4 201[...]
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Wellness Outsourcing on the Rise
Sep 11, 2014, by Gary BragarCompanies today are increasingly looking to Wellness programs as a means of meeting their business objectives. It’s a two sided-approach and benefit. First, the cost of employees missing work due to sickness, diseases and stress-related illnesses can be significant in terms of healthcare costs and productivity. Per Towers Watson, employer healthcare costs are expected to increase 4.4% [...]
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Healthy Industry Growth for TeleTech
Sep 10, 2014, by Vicki JenkinsTeleTech recently briefed NelsonHall on its growing healthcare sector business. A few years ago, TeleTech shifted its go-to -market strategy from being capability-led to sector-led. One of its key target sectors is healthcare, where TeleTech’s focus is U.S. tier 1 health insurance payers, providers and life sciences companies, also the personal health products sector. [...]
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Mastercard, First Data, and TSYS Partner with Apple to Enable Apple Pay for Mobile Payments
Sep 09, 2014, by Andy EfstathiouMastercard, First Data, and TSYS have partnered with Apple to enable Apple Pay for mobile payments. Apple Pay is a mobile payment service. Apple Pay works with iPhone 5, iPhone 6, and Apple Watch through an NFC antenna design, a dedicated chip called the Secure Element, and Touch ID security. Apple Pay can be set up by users with their credit or debit card on file from their iTunes Store acco[...]
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EVRY Sale Upcoming?
Aug 29, 2014, by Dominique RaviartEVRY has announced that it is considering strategic opportunities including a sale. EVRY is in theory an attractive target: the company has a sizable presence in a region with short- to mid-term growth potential: It is the largest IT service vendor in Norway ($1bn in revenues, excluding its financial services unit). Norway, with an economy that is heavily influenced by oil & ga[...]
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When The Going Gets Tough, The Tough Spend On S&M
Aug 28, 2014, by Rachael StormonthWhen you look at the financial performance of the four largest Indian oriented IT service providers (IOSPs) over the last four years, it becomes evident that there is a direct correlation between the level of topline growth they achieve and their expenditure on sales and marketing (S&M)…with EBIT margins benefiting from the strong topline growth. Let’s look at a few data points[...]
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Xerox's Loss is Accenture's Gain in Texas Medicaid
Aug 22, 2014, by Rachael StormonthIn a case that has been unfolding for several years now, and which heated up in early May, Accenture on August 1 assumed responsibility for administering Medicaid claims in the state of Texas. Accenture’s first award as a state’s primary fiscal agent was announced in the wake of a dispute between Texas and Xerox over its process for reviewing Medicaid dental c[...]
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Wipro ServiceNXT: Early Successes in Helping Win Large IT Outsourcing Deals
Aug 21, 2014, by Dominique RaviartWipro has updated NelsonHall on its ServiceNXT initiative. ServiceNXT aims to increase productivity in both IT infrastructure management and application management contracts. ServiceNXT is based on: Usage of Wipro IP and recommended COTS tools across the client’s operation for various tasks including ITSM, change management, demand management, problem management Analytics, based on d[...]
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HCL Awarded 11-Year Life BPO Contract Renewal to Consolidate Services by Chesnara
Aug 19, 2014, by John WillmottChesnara plc, the life assurance consolidator, has awarded a life & pensions BPO contract renewal to HCL Insurance BPO Services Limited ('HCL') which consolidates the services provided in the existing arrangements and which extends the service for a further 11 years. The service scope across the various books remains unchanged, as do the broad service levels. HCL’s original co[...]
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Workday Increasingly Important to HR BPO Vendors as Momentum Continues
Aug 19, 2014, by Gary BragarThe latest large partnership and implementation of Workday was announced August 13, 2014 by CSC who will establish a consulting practice enabling clients to transition to Workday, and also deploy Workday internally to ~70k employees globally. The move to launch Workday consulting and implementation practices, often alongside HR BPO capability, has already achieved considerable momentum. Similar[...]
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T-Systems Elaborates on Dynamic Workplace Offering
Aug 19, 2014, by Dominique RaviartT-Systems recently updated NelsonHall on its virtual desktop service offering, Dynamic Workplace, its new brand name for Future Workplace, a virtual desktop offering introduced in 2013. T-Systems Dynamic Workplace was introduced to address client needs for virtual desktop and mobility overall, based on a centralized approach to applications and data. T-Systems with this offering has taken sever[...]
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High Levels of HRO M&A Activity in H1 2014 Led by Benefits Administration Acquisitions
Aug 14, 2014, by NelsonHall AnalystOverall H1 HRO M&A activity is up year-over-year, and acquisition activity has increased in nearly all service lines except learning. While learning M&A activity was high in H1 2013, this year, M&A activity in H1 2014 was strongest in the benefits administration market, and it’s occurring in both the U.S. and U.K. as vendors strengthen their DC contribution capability.&[...]
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CSC Explains its SAP Next-Gen Offering
Aug 12, 2014, by Dominique RaviartCSC recently briefed NelsonHall on its SAP Next-Gen offering, unveiled in June 2014. CSC’s SAP practice is relatively large within CSC (headcount 7.7k, ~10% of CSC’s overall 80k). CSC has recently engaged in a service portfolio refresh to increase its differentiation through more specialized SAP-related services. This differentiation relies on adoption of automation tools and enhanc[...]
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Sopra Highlights Application Management Capabilities Before Likely Merger with Steria
Aug 12, 2014, by Dominique RaviartSopra recently updated NelsonHall on its application management (AM) capabilities. In 2013 Sopra generated ~€393m revenues from AM, or ~29% of its total revenues. The company is a top application management vendor in its domestic market, along with Accenture, Capgemini, Atos CGI, and IBM. Key AM clients of Sopra include Airbus, Orange, SFR, Crédit Agricole, EDF, Auchan, SNCF, BN Pariba[...]
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CSC Expands Partnership with IBM to Enhance Capability as Cloud Service Integrator and Manager
Aug 09, 2014, by John WillmottCSC has expanded its partnership with IBM to enhance its ability to offer hybrid cloud and mobility services. In particular, the partnership emphasizes CSC's continuation and development of its role as a cloud service integrator and manager, rather than as a direct provider of capital-intensive IaaS services. CSC has a large client base for traditional data center management, frequently using [...]
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