Hudson & Yorke, an international ICT management consultancy, has scooped the Outsourcing Award at the annual Management Consultancies Association (MCA) Awards, for its work with Barclays.
The winners of the MCA 2012 Awards were announced at the annual dinner and ceremony on 19 April, following an intensive judging process. Hudson & Yorke leveraged its specialist experience and flexible approach as a consultancy to enable Barclays to move to a hybrid model and selectively in-source some of its principal telecommunications services.
When Barclays made the strategic decision to move away from a fully outsourced model, Hudson & Yorke was brought on board to help the company write and negotiate the new complex services contracts. Hudson & Yorke worked closely with Barclays over a period of 18 months to negotiate supplier contracts, resulting in a successful move to a hybrid sourcing model which delivered significant cost savings for Barclays, and increased strategic control of its business critical sites.
Alan Leaman, Chief Executive of the MCA, states: “Our Awards recognise outstanding achievements, and this year’s winners have made a massive difference. Management consultancy is helping UK business at a difficult time, but also delivering benefits to millions of people.”
Harry McDermott, CEO of Hudson & Yorke comments: “It is great to be recognised for our work on this exceptional project with Barclays. As a specialist ICT consultancy Hudson & Yorke prides itself on delivering real value to companies through our expertise, and this client-sponsored award is confirmation of our consultants’ knowledge and hard work.”
Kru Desai is a partner at the firm and leads its public sector management consulting practice in the UK. She has worked at KPMG for 12 years in total, having started her career with the firm in 1993, rejoining as a partner in 2010
Desai has over 20 years experience of leading large, complex transformation programmes in the devolved public sector seeking to improve quality of public services, address productivity and secure economic growth.
Desai says: “This is a time of huge change in the local government landscape. The first wave of cost cutting is now largely in the past and councils are looking at more fundamental ways of bridging the future budget gap. So the time is right for professional service firms like KPMG to consider how local authorities can meet their wider economic, social and environmental priorities without hitting a budget wall.
“It’s not just about reducing costs within each service area – there are bigger opportunities in looking at funding, productivity and demand management, for example. These raise common questions for all local authorities, but we are seeing increasing variation between councils in their chosen solutions. This divergence shows where innovation is happening. That’s a good thing – but it needs careful handling. And that’s where KPMG can make a difference.”
Cost of hire and time to hire are only the fourth and sixth priorities when assessing the success of a recruitment process, according to a global survey from recruitment process outsourcing (RPO) firm Futurestep.
The firm surveyed nearly 1,600 HR professionals across five continents, finding that the performance of the individual in 46% was of cases the first assessment criterion, and the second most important criterion in 21% of cases.
Retention and the satisfaction of the line manager were the second and third most frequently used criteria, while cost of hire was only the first criterion in 12% of cases, and second in 15% of cases. Time to hire was top priority in 6% of cases, and second priority in 12% of times. ‘Promotability’ was the fifth highest priority.
In total, 62% of respondents have a formalised measurement process in place for assessing the impact of hires. However, 35% of respondents added that they admit that their organizations measure the impact of a new hire before they expect recruits to have made their greatest impact on the business.
Only 15% reported that measurement of a recruit’s impact took place after one to three years with the organisation.
HR professionals in France (22%) and those in local government (18%) were the least likely to measure impact within the first six months, something which was the case in more than 53% of Latin American firms.
Here’s a heretical thought: The UK economy is storming back to prosperity. In fact, if things carry on we’ll be back to 3 per cent growth pretty soon and all indicators will be pointing in the right direction. Even today things are pretty damn good.
Yet the data tells a different story, one of growth, job creation and low inflation. We really could be on the brink of a spectacular revival.
So if you want to start humming Rule Britannia and telling cynics that this sceptred isle is on its way back then are here are 12 cast-iron reasons you can reel off.
1 The economy is set to grow
The Office for Budget Responsibility, which provides the independent forecasts for the government, is forecasting real terms growth of 2 per cent next year, then 2.7 per cent and 3 per cent in 2015. Even this year growth will be 0.8 per cent.
2 Exports are up
Exports grew strongly in 2011, and hit a record high in October. Exports to BRIC nations are up 150 per cent in five years. (Read the latest BRIC countries news and business advice.) Exports to the Eurozone nations grew 11.3 per cent last year despite the ongoing crisis. There is a large number of high-perfoming sectors: for example, livestock exports are up 22 per cent on 2010, with the Far East being the fastest growing market.
3 We have the Pound…
…and not the Euro.
4 Jobs market is improving
Since December 2009 private sector employment has risen by 650,000 jobs – more than offsetting the net layoffs in public sector employment of 365,000. And what are the prospects for future hirings? Actually, a string of surveys suggests the rate of hiring is improving. The Federation of Small Businesses says there is a net balance of 1.2 per cent of small firms looking to hire. Looking long term the OBR forecasts employment rising steadily from 29.1m this year to 30m in 2016.
5 Savings ratio is back on track
In order to “detoxify” the economy it is necessary to recapitalise the banks and to reduce the appalling borrowing levels of consumers. This requires an increase in the savings ratio – the percentage of household income saved by consumers. During the 2000s the ratio was 4.3 per cent, indicative of the spend-and-borrow ethos of the Blair-Brown era. By comparison, the ratio during the eighties and nineties was 8.9 per cent.
At the start of the financial crisis in 2008 the ratio was a dreadful 1.7 per cent. Since then the rate has rallied. In the last quarter of 2011 the savings ratio was 7.7 per cent, a slight fall on the previous quarter, but undeniably in the right ballpark. Vicky Redwood of Capital Economics said: “Although the household saving rate nudged down in Q4, the back-data have been revised up a fair bit. So it now looks like households’ finances are in a bit better condition than before.” The detox is well underway.
6 We are in the right sectors
Ignore much of the blather about needing to “rebalance” the UK economy. It is, in fact, highly diverse with specialisms in precisely the right areas: pharmaceuticals, defence, nanotech, financial services, oil & gas, computer chips, hi-fi, computer games and mining. Our agriculture sector is world-class, and devoid of the terrible CAP-related problems facing Poland, France or Ireland. Our motorsport industry is larger than that of France, Germany and Italy put together.
7 Services sector is recovering fast
The Purchasing Managers Index, which reflects the health of the services sector, rose from 53 in February to 55.3 in March. Any number above 50 indicates growth. Chris Williamson, chief economist at Markit which compiles the PMI, said the data suggests the UK economy grew by 0.5 per cent in the first quarter, contradicting fears we slipped back into recession.
8 Public sector borrowing is falling
The biggest challenge of this parliament is to cut the difference between tax revenue and state spending. In 2011-12 the government borrowed £137bn to cover the shortfall. By 2016-17 this will have fallen to £21bn according to the OBR, or 1.1 per cent of GDP.
9 Inflation is low, and falling
In 2011 the Consumer Price Index hit 4.5 per cent. Cue panic! But this figure was partly due to high commodity prices and the VAT rise. The CPI is forecast to fall to 2.8 per cent this year and then stay at 2 per cent for the next few years – the ideal scenario.
10 Government borrowing is absurdly cheap
When Labour left office lenders were asking 4 per cent to lend to the UK government. Now the effective rate of interest on 10-year gilts is a shade over 2 per cent. This matters. The two percentage point fall equates to a saving of £43.2bn over the next five years.
11 The size of the state is shrinking
When the state gets too big it squeezes out the private sector, causing economic stagnation. In the noughties the government grew 53 per cent in real terms – the biggest expansion by a developed economy excluding war and socialist revolution. In Northern Ireland and Wales public spending reached more than 70 per cent of GDP, and 64 per cent in the under-performing North-East. Now the bloatage is deflating. The government will decline from 48.4 per cent of GDP in 2011 to 39 per cent in 2016-17. Still some way short of Hong Kong’s 17 per cent. But a welcome start.
12 Brits love entrepreneurs
While the French are wondering whether to vote for a guy who wants a 75 per cent top rate of tax (Francois Hollande, currently bookies’ favourite) or his rival who wants a 100 per cent rate (Jean-Luc Mélenchon, admittedly an outsider), the UK has cut the top rate and offers a raft of incentives to start-ups. Our universities are hot-beds of ambition. And we have the strongest investment environment of any European nation, ranking #1 for private equity by a considerable distance. Overall, the World Bank ranks the UK as the easiest place in the world to borrow money. Together, entrepreneurs and finance are the most powerful engine economic prosperity. And on both counts Britain is up there with the very, very best.
The Home Retail Group (HRG) has signed a four-year agreement with Atos, an international IT services company, for the implementation of a business account scheme to allow SME business customers to purchase goods and services in-store, online and via Argos Direct. The new For Business account card will be launched by HRG’s business to business division, Argos for Business.
Danny Clenaghan, Managing Director of Argos for Business said: “We are committed to providing excellent service to our customers and we are excited to extend this service to the SME market. We are confident that Atos will deliver this service to the excellent standard our customers expect. The For Business account allows businesses instant access to over 35,000 product lines at great value prices, supported by excellent account management tools.”
Iain Kingsley, SVP for Hi-Tech Transactional Services in the UK Atos, said: “We are delighted to add Home Retail Group to our client list, which extends our business account scheme in the retail sector. We have developed an excellent offering in payment services and this contract is further evidence that they can be adapted and tailored to meet the needs of different clients to help them attract business customers, drive sales and therefore gain competitive advantage.”
Atos, a leader in transaction services, will be providing full management of the business account card for small to medium enterprises in the UK and providing an end to end service from application to payment. The scheme will commence in April with a trial across a region of Argos stores.
The on-line account support facility will allow customers to manage their account, control costs and access various management information tools including a line item detail invoice archive.
Tata Consultancy Services (TCS) has received an award for Operational Performance at the inaugural Association of Management Consulting Firms (AMCF) Awards presentation in New York. The AMCF awards, which celebrate excellence in management consulting, recognized TCS for its demonstration of improved operational and business performance.
TCS was also a finalist in two other categories – Customer Engagement and Developing Markets. TCS was the only Indian-based firm to be recognized as a finalist in any category.
The AMCF awards spotlight the most innovative and effective consulting projects done over the past year, as chosen by an independent panel of judges comprising well-known executives from business and government as well as respected journalists and academics.
“AMCF award winners have made important contributions to the consulting industry, and we recognize them as innovators and exemplary performers,” said John Furth, President & CEO, AMCF. “These consulting teams represent a tremendous force in helping companies find sustainable solutions to critical challenges across industries.”
“We are truly honored to be recognized by the Association of Management Consulting Firms for excellence in Operational Performance,” said Rajagopal J, Executive Vice President and Head, Consulting, TCS. “This designation by an organization that is a true thought leader and trusted resource in the consulting industry only further encourages us to continue to help our customers identify critical challenges and devise effective solutions, allowing them to remain operationally prudent yet strategically focused.”
The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs – published today – provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.
Permanent placements increase further but temp billings decline
Recruitment consultants reported a rise in permanent staff placements for the third month in succession during March, albeit at a slower pace than February’s nine-month high. In contrast, agencies’ temporary/contract staff billings decreased. Although moderate, it was the fastest drop in short-term appointments for over two-and-a-half years. Panel members frequently indicated that employers had chosen to convert temp workers into permanent employees due to the effect of Agency Worker Regulations.
Vacancies rise at faster pace
Overall demand for staff strengthened in March, as the number of vacancies available to jobseekers rose at the fastest pace since July 2011. The pick-up in growth was driven by a stronger increase in permanent job vacancies, which offset a slower rise in the number of available short-term roles.
Slowdown in candidate availability
Growth of permanent staff availability eased further in March to near-stagnation. Temporary/contract staff availability meanwhile rose at the weakest rate since August 2011.
Permanent salaries flat
Starting salaries awarded to permanent hires were broadly unchanged in March, following a modest decline in February. Temporary/contract staff pay rose modestly, with some panellists highlighting the inflationary impact of Agency Worker Regulations.
Ronnie McCombe, partner at KPMG, comments: “It’s encouraging to see permanent placements in positive territory for the third month in a row in 2012, albeit slightly down on last month’s high. This provides further hope that the employment market will win through to a stronger recovery as the year progresses. Sectors such as IT & Computing and Engineering/Construction continue to perform well. However, it is certainly still too early to call a jobs recovery. There remain real tensions beneath the surface. Some of the rise in permanent placements appears to stem from employers simply switching temporary workers to permanent status due to the higher entitlements that the Agency Worker Regulations have given them. And while it is heartening to see that overall vacancies are rising, salaries are stagnating meaning the economy is likely to carry on feeling the pinch from cost conscious consumers reluctant to part with their money.
“There are grounds for cautious optimism but recovery remains fragile and could all too easily be blown off course.”
The fifth annual conference of the Cass-Capco Institute on Risk will take place on 19 April 2012 at Cass Business School, part of City University London. The event is a unique opportunity for leading practitioners and academics to debate ongoing changes in risk management and industry responses to regulation as the world looks for continued recovery from the financial crisis. Developing more effective risk management processes in financial institutions has been a key and continued part of the response to the financial crisis.
Speakers at the conference include world authorities on risk from both the academic and business communities. Additionally, the conference also offers five discussion panels on the following topics: economic risk, financial risk management, regulatory risk, CCP alternatives and potential unintended consequences of government sponsored clearing and operational risk. The conference will address many of the risk-related issues featured in the latest issue of The Capco Institute’s Journal of Financial Transformation.
Stephen Vinnicombe, Capco Partner and UK Finance, Risk and Compliance Lead said: “Banks and investment firms are under continued pressure to monitor and improve the quality of their risk management. While significant efforts have been made in this area, Capco and Cass believe that the debate between industry practitioners and leading academics will yield further insights to the increasingly complex environment, better positioning the industry to navigate regulatory requirements and drive competitive advantage.”
Richard Gillingwater CBE, Dean of Cass Business School said: “As a leading provider of business education specialising in the financial sector, Cass Business School maintains risk management and assessment at the heart of its teaching and research. This event brings together practitioners and academics to respond to industry challenges and develop best practice ideas. The continuing partnership between Cass and The Capco Institute further establishes Cass’s reputation as a thought leader in the higher levels of financial regulation.”
The UK labour market is heading in the right direction, according to the latest Reed Job Index. Vacancies increased by 9% in the first quarter of 2012, compared with the same period last year, whilst there was a 6% increase between Q4 2011 and Q1 2012. This rise in job vacancies suggests the UK economy may be well placed to avoid a double dip recession.
The Reed Job Index report is a leading provider of up-to-the-minute insight into the conditions and trends in the UK labour market and is based on data collected from over 10,000 UK companies advertising on reed.co.uk. The report tracks the number of new jobs and salaries on offer each month against a baseline of 100 set in December 2009. The monthly report analyses data across 37 industry sectors and 12 UK regions and is a leading indicator for future economic growth.
The engineering sector registered another robust, job-creating performance after reaching its highest level in March 2012 since the index was set in December 2009. Other employment sectors driving this growth include IT, construction, motoring and purchasing.
The East Midlands was the UK’s leading region by measure of year-on-year growth, while Scotland and Northern Ireland were the only areas to report a decline in employer demand compared with February.
Commenting on the figures, Martin Warnes, Managing Director of reed.co.uk said: “The latest Reed Job Index shows that job creation has been strong during the first three months of the year. It represents a strong improvement on the same period last year and supports the growing confidence in the UK’s economic recovery which was expressed this week by both the PMI and the British Chambers of Commerce.
“Employers in technical and manufacturing sectors are driving this recovery and are taking on more staff now compared to a year ago. Led by an upbeat engineering sector, these industries are showing intent to plan sustainable futures by increasing staff. A boost to the number of new construction jobs available also gives hope that a sustained economic recovery is on the cards.
“But we mustn’t forget that, for a lot of people, finding work continues to be a real struggle, whilst the cost to business of employing staff remains a barrier to recruitment. The budget may have been seen as friendly to business, but the taxation burden of actually employing staff remains high which needs to be addressed by policy makers to assist continued job growth and a sustained job-led recovery.”
The volume of business in the financial services sector grew for the eighth quarter running, at well above the average pace, in the three months to March, according to the latest CBI/PwC Financial Services Survey.
This growth is reflected in the first rise in optimism among financial services firms (+32%) in a year and an unexpected increase in employment in the sector (a balance of +19%). Companies also plan to invest more in IT over the next year.
Of the 95 financial firms that responded, 44% saw volumes rise in the quarter to March, and 21% reported a fall. The resulting balance of +23% was well above the long-run average (+12%) and driven primarily by business with private individuals. In the coming quarter, companies expect growth to accelerate somewhat (+34%), again mostly coming from business with individuals.
The rise in incomes was driven by fee, commission, or premiums (+13%), with the value of net interest, investment or trading remaining flat (+3). Meanwhile, average spreads widened further this quarter (+11%), building on already solid growth in the previous quarter (+43%).
The growth in income more than offset the impact of the sharp increase in total costs, allowing profitability to rise more rapidly than in the previous three quarters (+21%).
Numbers employed in the financial services sector rose unexpectedly (a balance of +19% compared with an expectation of -18%). A similar increase is expected in the next quarter (+20%).
Financial services firms resumed investment in both marketing (+16%) and information technology (+47%) in the three months to March, after a slack period last quarter. Spending intentions for IT were the strongest in a year, as financial services companies looked to increase efficiency.
As has been the case over the last year, companies continue to cite uncertainty about demand (+55%) and inadequate net return (+46%) as the factors most likely to limit capital expenditure over the next twelve months. The number of firms highlighting the shortage of labour as a significant constraint increased this quarter (+35%).
Level of demand (75%) and competition (52%) continued to be the two most significant factors likely to constrain business expansion in the coming twelve months.
Ian McCafferty, CBI Chief Economic Adviser, said: “Financial services sales volumes and income continued to rise this quarter, putting the sector’s recovery on a firmer footing.
“Optimism levels and business investment intentions have also improved, in contrast to last quarter as some of the worst risks around the euro area crisis have eased.
“The unexpected rise in employment is a further encouraging sign for the sector. But with the current level of business regarded as below normal, conditions still remain challenging for financial firms.”
Analysis by sector
Banking
Banks reported a notable rise in optimism, with business volumes expanding for a second consecutive quarter, and a similar rate of growth expected in the three months ahead. However, total costs rose sharply over the past three months. Despite growth in business volumes and income values, the rise in costs prevented any growth in profitability. Numbers employed rose unexpectedly and firms expect to add to headcount further in the next quarter. Banks plans for expenditure on IT are higher than average. Statutory legislation and regulation is widely cited as an investment motive.
Building societies
Building societies were considerably more optimistic about their overall business situation compared to the last quarter. Business volumes grew at the fastest pace since June 2011 this quarter, despite predictions that volumes would remain broadly flat. However, the level of business was seen as below normal. The volume of business is predicted to be broadly flat in the coming quarter. Building societies plan to increase IT expenditure in the coming year, with increasing efficiency/speed, replacement, and statutory legislation and regulation given as the main reasons.
Finance houses
Optimism amongfinance houses increased over the last three months. Business volumes fell strongly over the last quarter, and finance houses reported the level of business as below normal. However, a solid rise in volumes is expected next quarter. Numbers employed fell in the three months to March and headcount is set to fall further over the next quarter. Expenditure on IT is set to increase in the year ahead relative to the past 12 months. Increasing efficiency/speed and replacement were the main reasons given, followed by reaching new customers.
Kevin Burrowes, UK Financial Services Leader at PwC said: “More positive economic data and a slightly more stable environment in the eurozone mean that banks are much more confident about their sector. This confidence is translating into recruitment with many banks reporting that they plan to increase headcount over the coming months. Banks are also planning to invest in their businesses, particularly in their digital offerings, and customers should reap the rewards of this.
“The picture is not so rosy for building societies which, while displaying more confidence than in the last quarter, are still concerned about asset quality and the impact of the regulatory burden. However, the relatively high level of home loan approvals in December and less turmoil in the eurozone mean that confidence among building societies is higher than in the last quarter.
“There are still choppy waters to be navigated and, as ever, stringent cost and risk management will be key.”
Life insurance
Business volumes increased for a ninth consecutive quarter, with further growth expected in the next three months. Income expanded modestly, but stronger rates of growth are forecast. Life insurers reported an unexpected rise in profitability and optimism about the business situation rose marginally. There was a rise in headcount and a further increase is expected. Investment intentions are reported to be above average.
General insurance
Optimism amongst general insurers rose very modestly over the three months to March. Business volumes expanded slightly for the second consecutive quarter, although more slowly than expected, and growth is expected to accelerate over the next quarter. Profitability rose strongly over the past three months and is expected to rise robustly in the next quarter. Average commissions, fees and premiums paid rose at their fastest rate since December 2010 and are expected to rise at a similar pace next quarter.
Insurance brokers
Optimism amongst insurance brokers rose in the three months to March. Business volumes fell for the third consecutive quarter albeit at a slower pace than in the previous two quarters. However, volumes are expected to grow strongly in the three months to June. Overall profitability rose for the first time in a year, albeit modestly, and is expected to rise again next quarter at a slightly faster pace. Insurance brokers are planning to spend more on IT in the year ahead, driven by a need to increase efficiency/speed and by replacement.
Mark Stephen, UK Insurance Leader at PwC, said: “There are a number of reasons for general insurers to be feeling positive as business levels are growing, price increases are starting to come through and claims growth is slowing at last. This positive backdrop has given insurers the confidence to start hiring again – a welcome reversal after two quarters of headcount reductions. However, the commercial sector is an area of concern as business has fallen to disappointing levels.
“Strong rises in customer demand and levels of new business has finally ended life insurers’ run of pessimism. This positive backdrop is allowing life insurers to invest heavily in IT, marketing and performance measurement to ensure they are well placed to respond to the upcoming retail distribution review and the challenges it will bring. Life insurers are also looking to boost staff numbers, although there are concerns over the availability of professional staff due to the range of investment and regulatory projects companies are tackling.”
Investment management
Business volumes rose strongly over the past three months, defying expectations of a small decline. Volumes are expected to rise at an even faster pace in the quarter ahead. Investment managers were significantly more optimistic about the business situation than they were three months ago, and profitability rose at its strongest in a year. Firms’ plans for expenditure on IT are now well above their long run average, although the proportion of firms citing uncertainty about demand as a constraint on investment is the highest since September 2009.
Securities trading
Business volumes in securities trading declined in the three months to March, and a further fall is expected next quarter. Income fell, defying expectations of growth. Profitability declined for the fourth successive quarter, despite a fall in total operating costs, as shrinking business volumes drove up average costs. Numbers employed dropped after nine consecutive quarters of growth and headcount is expected to fall again next quarter. The level of demand and competition are the main factors likely to inhibit business expansion over the next year. Overall, investment is expected to be broadly flat over the coming year, although a slight rise in IT expenditure is planned.
Pars Purewal, UK Investment Management Leader at PwC, said: “Investment managers have shown much more confidence in their sector compared with recent quarters. Growth in investment management is expected although continued cost reduction programmes across the sector mean that further headcount reductions are likely. Investment managers also need to look to the regulatory changes on the horizon and factor these into their plans and business models.
“Falling levels of business and higher costs per transaction mean that security traders have reported very downbeat predictions in the sector. The long-term outlook is negative among traders and concern about the impact of upcoming regulatory changes could depress this even further. It therefore seems likely that further job losses are inevitable.”
