Capgemini to grow Aussie headcount by a quarter

Capgemini's Australian headcount could reach almost 1700 by the year's end to support a growing "digital transformation" consulting business and a massive outsourcing deal with banking group ANZ.

The services firm last month agreed to take on 110 ANZ staff in Melbourne and 250 in Bangalore, India under a new managed services agreement for IT testing and environment management.

Capgemini’s Australian chief executive officer, Paul Thorley, expected the team to grow 15 percent in the coming six months, from 1350 as of June 30 to 1550, due to the ANZ deal.

Demand from its other customers would likely call for an additional 130 staff, he speculated, noting that the Australian team had grown by about 140 in the six months to June 30.

Globally, Capgemini’s headcount rose 14 percent in the most recent half-year to 121,026, including 46,105 “offshore employees”, of whom 37,000 were located in India.

Capgemini Group chairman and chief executive officer Paul Hermelin told investors last week that the group hoped to have a total of 80,000 offshore workers by 2015.

According to Thorley, the Australian business was supported by about 1000 IT workers in India and 50 business process outsourcing workers in China.

As-a-service market heats up

Capgemini Group last week reported revenues of €5.15 billion ($AU6.05 billion) in the six months to June 30, reflecting an 8.3 percent growth on the same period last year.

The half-year results, ending 30 June 2012, included €166 million ($AU195 million) from the Asia Pacific region, of which Australia contributed about half.

Capgemini Australia’s managing director of business development, Deepak Nangia, told iTnews that regional revenues grew 20 percent in the most recent half-year, while Australian revenues grew 27 percent.

The ANZ IT testing and environment management deal, worth an undisclosed amount and highlighted in the Capgemini’s global analyst presentation, did not contribute to the half-year results.

“[Australia] was by far the major contributor in terms of Asia Pac growth,” Nangia said.

“The industry sectors that have grown for us and had the most impact were the energy and utilities sector in Australia, followed by our public sector business — boosted by our growth within the tax business — and, of course, the financial services business.”

Of Capgemini’s service offerings, Nangia said its outsourcing business contributed a quarter of Australian revenues, while applications, licensing and technology contributed half.

Its consulting business accounted for a quarter of Australian revenues, with a particularly strong demand for its “digital transformation” program, which developed multi-channel customer engagement strategies for clients.

“Consulting has been driven, particularly in this market, by the digital transformation wave that is creating build opportunities for new platforms etc.,” Australian chief executive officer Thorley said, highlighting unnamed customers in the “multi-channel retail space”.

Australian retail giants Myer and David Jones have embarked on multi-channel projects in recent months, with the latter working closely with outsourcer IBM.

“You could almost rename our consulting practice a digital transformation practice,” Thorley said.

“It’s that important, in terms of repositioning what we actually do at the front-end of our client relationship.”

Nangia said Capgemini Australia’s outsourcing business was also transforming to focus more on software, platform and infrastructure-as-a-service offerings, with customers choosing to outsource “any of the assets that they would have traditionally owned”.

“The next stage of that outsourcing is people being far more comfortable with their assets sitting on the cloud, rather than sitting with one service provider,” he said.

“So the whole space of outsourcing is changing and [the technology business], we believe, will probably become less and less relevant as organisations start to buy services and technology will become part and parcel of that outsourced service rather than being executed as large-scale programs.”

Looking forward, the executives did not expect the changes in their business streams to call for any major restructures, because any as-a-service offerings would still rely on technology staff to manage the platforms within Capgemini.

“Even though it’s not impacting us just yet, the use of the offshore resource pool allows us to [vary] our headcount more readily,” Thorley noted.