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Welcome to Inside Outsourcing: The Outsourcing Week in Review
THE WEEK IN REVIEW
Hello, and welcome to a new edition of Inside Outsourcing! We know your week is incomplete without our news recaps. So, let’s get on with it!
Outsourcing giant Capita caused a stir in the United Kingdom (UK) as its IT systems went down for a weekend due to a cyber attack. According to the firm, some of their services were affected, particularly their internal Microsoft Office 365 applications. Capita said they have already restored colleague access while making good progress in restoring remaining client services in a secure and controlled manner. The outsourcing giant has about £6.5 billion (US$8.07 billion) in contracts with the UK’s public sector and employs more than 50,000 British citizens.
India is expecting more IT contracts as a result of the recent Credit Suisse-UBS merger. According to Phil Fersht, CEO of IT consultancy firm HfS Research, the merger could be good news for providers with the deepest institutional knowledge of the client — like Cognizant and TCS. ISG Principal Analyst Mrinai Rai added that large-scale mergers and acquisitions often decrease and enhance service scope for service providers. According to anonymous sources, Indian IT giants TCS, Wipro, Infosys, Tech Mahindra, and HCL Tech have around US$600 million in contracts with Credit Suisse.
Sri Lanka’s outsourcing association signed a landmark agreement last week with a major university to produce “more highly skilled and capable” talent for the IT/BPM industry. Sri Lanka Association for Software Services Companies (SLASSCOM) said that its partnership with University of Sabaragamuwa in Sri Lanka (SUSL) is “a timely and critical requirement” to maintain a “robust academia-industry ecosystem” for Sri Lanka’s evolving IT/BPM sector.
Further north, Pakistan Senator Irfan-ul-Haque Siddiqui is pushing for an upgrade in the local Business Process Outsourcing (BPO) industry. In a column, Siddiqui suggested improvements in the country’s infrastructure, technology, regulations, and global connections to attract more foreign investments. Data from the Pakistan Software Export Board revealed that the nation’s BPO industry generated US$2.1 billion in revenue during the fiscal year 2020-2021.
In a recent interview, Cloudstaff Chief Recruitment Officer Kal Kukadia said that outsourcing could help companies cast a wider net to find and recruit the right talent they would need. In the HRchat Podcast, Kukadia said the pandemic-induced Great Resignation in the United States (U.S.) and Europe made it hard for businesses to find “good people at the right price point.” Kukadia emphasized that being able to find skills offshore should be something to be considered to make one’s long-term growth strategy robust.
Several new M&A deals were signed last week. Here are the highlights:
Staffing partner Power Staffing Solutions completed the acquisition Recruitment Process Outsourcing (RPO) firm Hourglass HR to expand its footprint across Canada. According to Power Staffing Solutions Managing Partner Saye Sathiyakumar, both firms share the sectors, services, and “uncompromising passion for excellence,” making them a great fit for each other. With this takeover, Hourglass HR Co-founder Mark Cohen was appointed Vice President at Power Staffing Solutions, while Jonathan Cohen will remain at Hourglass HR and head the business as the new Director of Operations. Similarly, New York-based recruitment firm Imagine Staffing recently acquired Mary Kraft HR to expand its presence in the Mid-Atlantic region. Imaging Staffing president Brian Manley said that adding Mary Kraft HR is a major milestone in their strategic process to further scale and grow nationwide through impactful acquisitions.
Financial Technology and BPO provider Service Cops entered Ethiopia by partnering with Awash Bank. According to Service Cops Managing Director Mathias Kamugasho, the partnership will innovate other digital products across the bank’s financial value chain — including an instant microloan offering for Awash’s 12 million customers. Service Cops Executive Chairman Joseph Kiiza Ndiho called the partnership a “testimony to innovativeness,” noting that customers today “want great service and want it fast.” Awash Bank is Ethiopia’s largest privately run bank, with a chain of more than 800 branches.
Software development company VMO Holdings signed an MOU with Hong Kong-based firms Association of Blockchain Development, ACH Worldwide Limited, and Greatmeta. The deals, facilitated by the Hong Kong Trade Development Council (HKTDC), are set to open VMO to explore business opportunities in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA). During the signing, VMO Head of East Asia Markets Ted Nguyen said they would continue to expand mutually beneficial cooperation with enterprises and strive to build new connections in the GBA market.
Information systems provider GRM celebrated its growth in South America. In a press release, the firm said that it’s South American operations have successfully introduced various digital solutions previously adopted by U.S.-based clients across vertical markets. With this success, the firm plans to continue expanding its digital business among existing and new clients while strengthening its established operations in Brazil, Colombia, and Peru.
Meanwhile, workplace solutions provider ManpowerGroup Greater China attributes its revenue increase to the growth of its flexible employment unit. The firm said its revenue growth was mainly due to the increase in the number of contract employees who found jobs and the increase in average salary during the reporting period. ManpowerGroup Greater China’s CEO and Executive Director added that he is confident in the prospect of the HR market in the future. On the other hand, talent solutions provider Hudson Global’s Q4 2022 revenue fell 5.5% to US$43.6 million in constant currency, while its adjusted net revenue increased 4.8% in constant currency to US$22.2 million. Hudson Global CEO Jeff Eberwein said their strong top-line growth in the UK and Australia was partially offset by the U.S. technology sector’s slowdown and lower hiring volumes in China. However, the firm’s full-year revenue increased by 27.1% to US$200.9 million as its European operations saw a revenue increase.
The U.S. tech industry continues to grow, seeing a 3.2% increase in employment in 2022. According to CompTIA Chief Research Officer Tim Herbert, the tech labor market routinely defied expectations as employers increasingly relied on technical and digital skills. For 2023, CompTIA projects a three per cent increase — or 272,000 jobs— in the U.S. tech labor market. And future tech recruits could see salaries as high as $120 per hour despite massive layoffs in the industry. According to a Bloomberg report, tech companies are doubling down on resources in mission-critical areas like artificial intelligence (AI), engineering, and software development. The report also stated that the tech industry had significantly contributed to the U.S. economy by claiming the biggest market value share in the S&P 500, accounting for about six per cent of the country’s gross domestic product (GDP).
ChatGPT is proving popular in the workplace. In a newly-released survey, consulting firm Korn Ferry revealed that nearly half (46%) of professionals currently use ChatGPT as part of their workday. About 80% of respondents also believe ChatGPT is a legitimate, beneficial work tool that is here to stay. Korn Ferry Senior Client Partner Brad Frank said while ChatGPT is a useful tool, it should not replace people’s “personalized approach” to their daily work and job searches.
Still nice to have that personal robotic touch!
Tuesday, April 11, 2023
NEWS THIS WEEK
10 April 2023
- Imagine Staffing acquires Mary Kraft HR – read article…
- India’s MPSEDC plans for ‘plug-and-play’ IT/BPO facility – read article…
- Google CFO announces new cost-saving strategies – read article…
- SLASSCOM, SUSL to foster ‘stronger’ IT/BPM workforce – read article…
07 April 2023
- U.S. tech jobs grew 3.2% in 2022 — report – read article…
- 46% of workers are using ChatGPT, says Korn Ferry – read article…
- Tech salaries still high despite mass layoffs — Bloomberg – read article…
- Cyber attack caused Capita’s IT outage – read article…
06 April 2023
- Flexible employment increases ManpowerGroup’s revenues – read article…
- Indian IT firms to benefit from Credit Suisse-UBS merger – read article…
- VMO Holdings signs MOU with 3 Hong Kong firms – read article…
- Fintech-BPO giant Service Cop enters Ethiopia – read article…
05 April 2023
- TELUS appoints new VP of operations for Romania – read article…
- Eastvantage announces new Business Development Director – read article…
- Hudson Global releases Q4 2022, full-year results – read article…
- Power Staffing Solutions acquires Hourglass HR – read article…
04 April 2023
- GRM celebrates ‘significant growth’ in South America – read article…
- JAS Worldwide announces new Global CIO – read article…
- Senator pushes for upgrade in Pakistan’s BPO industry – read article…
- Outsourcing helps match firms with the right talent, says Cloudstaff – read article…
