May 2019 Services, Technology and Welcome to the May 2019 edition of Latitude Executive Consulting’s newsletter. The newsletter rounds up an eclectic mix of recent news across Consulting - the globe within the Services, Technology and Consulting sectors...which we Newsletter hope you enjoy! The material has been sourced from a range of publicly available media and business contacts/partners.
1. Amazon The organisations covered in this issue are: Amazon has announced that it’s working to offer free one-day shipping as the default for Amazon Prime customers, instead of the free two-day Prime shipping primarily offered today. “We’re currently working on evolving Prime two-day to Prime one-day,” says Chief Financial Officer Brian Olsavsky during 1. Amazon the company’s first quarter 2019 earnings call. 2. IBM The new free one-day shipping method should be different from today’s free 3. Wipro same-day and free one-day shipping, which usually require you (in the US) to order at least $35 worth of items. The free one-day shipping also won’t come 4. Slalom at an additional cost to consumers, besides the required Prime membership 5. Microsoft subscription.
6. Accenture Olavsky elaborated, “We’re already starting down this path… We’ve expanded 7. Atos the number of zip codes eligible for one-day shipping.” He did acknowledge that “it will take us a significant amount of time to achieve.” He says Amazon 8. EY was working on improving its shipping logistics over the past quarter, and will use the US Postal Service and all its other transportation partners to help make free one-day shipping the standard for Prime customers.
Amazon says it’ll tell us more about the expansion of free one-day shipping in
the second quarter of the year. Development is beginning in North America for now, but it will eventually expand globally. Olsavsky adds, “The vast majority of items are available in two days. If we cut that in half...we think it will open upE a lot of potential purchases and a lot of convenience.” x a 2.m IBM p IBMl has announced the expansion of the IBM Q Network to include a number ofe global universities with the intent to partner with IBM to accelerate joint research in quantum computing, and develop curricula to help prepare students for careers that will be influenced by this next era of computing, o across science and business. The IBM Q Network™ is the world's first f community of Fortune 500 companies, startups, academic institutions and
research labs working to advance quantum computing and explore practical applications.a
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For example, IBM is announcing Florida State University, the University of Notre Dame, Virginia Tech, Stony Brook University, and the University of Tokyo will have direct access to IBM Q's most-advanced commercially available quantum computing systems for teaching, and faculty and student research projects that advance quantum information science and explore early applications, as academic partners.
Examples of this collaboration includes:
The University of Notre Dame: As part of the IBM Q Network, the university will grow an interdisciplinary quantum-programming community, and prepare a workforce at the undergraduate and graduate levels for the development of novel quantum computing applications in chemistry, physics and engineering and the creation of tools for increasing the efficiency of quantum computers.
Virginia Tech: As a member of the IBM Q Hub at Oak Ridge National Lab, Virginia Tech will work in conjunction with the Department of Energy, and chemistry experts at the IBM Almaden Research Center on the development of new quantum algorithms specifically in the field of quantum chemistry.
Duke University: The Brown Lab, led by Dr. Kenneth Brown, which focuses on "quantum systems to build quantum information devices and sensors" will work with IBM in the area of quantum error correction, an algorithmic method for removing errors in quantum computers, which is expected to be important for future quantum computers regardless of the hardware platform.
Harvard University: Through its recent investment in a Harvard Quantum Initiative, Harvard has committed to developing a broad community of researchers and educators in quantum science and engineering, including this collaboration with IBM's Q Network. Harvard students and researchers aim to transform sensing, communications, and computation — while developing the educational platform for quantum engineering and science for the long term.
The University of Colorado Boulder: As part of the IBM Q Network, CU Boulder will seek collaborations with IBM Q scientists and engineers through its CUbit Quantum Initiative, where university, industry and government scientists conduct joint R&D, train students to contribute to the expanding quantum workforce, and engage with a range of industry partners.
The University of Waterloo: Working with IBM, the University of Waterloo will focus on accelerating collaborative research in quantum algorithms and quantum complexity theory.
"Developing practical quantum applications that drive business and scientific breakthroughs requires a diverse ecosystem," said Dr. Anthony Annunziata, IBM Q Network Global Lead, IBM Research. "Partnering with these world- leading academic and research institutions is key as we work to educate, empower, and get the next generation of students 'quantum ready' to advance the field."
Beginning this summer, IBM will host developer boot camps and hackathons for hands-on training of the open source IBM Q Experience cloud services
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platform, and the full-stack open source Qiskit quantum software platform on campus at participating universities.
The IBM Q Network provides its organizations with quantum expertise and resources, quantum software and developer tools, as well as cloud-based access to IBM's most advanced, commercially available and scalable universal quantum computing systems. In addition, the no-cost and publicly available IBM Q Experience now supports more than 100,000 users, who have run more than 10 million experiments and published more than 180 third- party research papers. Developers have also downloaded Qiskit more than 160,000 times to create and run quantum computing programs. Big numbers!
3. Wipro
The Ang-Hortaleza Corporation (AHC) and Wipro Consumer Care (WCC) have signed a Share Purchase Agreement for the sale of 100% of AHC’s stake in the Personal Care Business of Splash Corporation (SC). Splash is among the largest personal care players in the Philippine market which recorded revenues of USD 80 Mn. It has built iconic brands like SkinWhite – the number one scientific whitening lotion in the country; Flawlessly U – a fast-growing herbal beauty brand; Maxi-Peel - the leading and dominant brand in the exfoliants category; Vitress – the number one brand in hair styling aids; and, Hygienix – one of the fastest growing germicidal brands today. These brands cover a wide spectrum of personal care categories and are in leading positions in respective segments. Wipro Consumer Care forms part of Wipro Group of Companies, a US$8.4 billion company based in India and is a leading global information technology, consulting and business process services company. It also has operations in consumer care and lighting, infrastructure engineering and medical systems. The transaction strengthens Wipro’s Consumer Care portfolio in personal care and completes its South East Asian footprint. Mr. Nagender Arya, Regional Director, Wipro Consumer Care says: “This is an exciting milestone for us, given our Vision of being amongst the top 3 players in Personal Care in Asia. This transaction gives us a market leading position in the Philippine market, which is one of the strong economies in the region and a formidable personal care market. This is our 11th acquisition and reinforces our commitment to continue to invest in emerging markets and build a strong portfolio of local jewels in terms of brands catering to strong niches in each of the markets Brands of Splash overlap with our portfolio in the region and I see tremendous opportunity to further leverage the strengths of our manufacturing, R&D, and sourcing for Splash brands.” Dr. Rolando B. Hortaleza, CEO and Founder of Splash Corporation says: “I am very glad that Splash is becoming part of the Wipro group. This gives us immediate access to resources that will help us fuel faster growth in our business, and enable us to unlock the true potential of our brands. Furthermore, Wipro shares our focus of building strategy with local consumer insights as well as in driving operational efficiency." Dr. Hortaleza will stay on as an advisor in the areas of marketing, innovation, and the overall transition of the business.
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Additionally, Mr. Neeraj Khatri, Incoming CEO (Splash Corporation) states: “This acquisition enables us to grow in Philippines market by leveraging Splash’s distribution strength across market segments. Splash’s brands can be expanded further to other international markets where Wipro has strong footprint and brands have latent equity. These brands are not only strong in the Philippines, but also have strong equity in multiple international markets like Indonesia, Vietnam, Hong Kong, Middle East, and Nigeria.”
4. Slalom Consulting
Slalom Consulting, a large management and technology consultancy in North America with some 4,000 consultants and revenues of more than $550 million, is opening an office in Manchester, UK. Founded in Seattle in 2001, the advisory firm spent its initial 13 years of business focusing on domestic expansion. While many fast-growing firms in Europe seek to expand across borders to open up new markets, Slalom’s positioning in the world’s largest and most mature consulting market meant that by the start of 2014, the firm had grown its revenues to around $480 million with offices solely in the US. It was then that the firm decided the time was finally right to go global, opening an office in London. Run by Alex Qatsha – formerly a consultant at Unisys, Accenture and Deloitte – the London operation has since enjoyed a growing track record across the UK and European clients and industries. Through its London office, Slalom has established a reputation in the UK for successfully delivering impactful projects to private and public sector clients across numerous industries. In the following four years, Slalom has grown into more new markets, including Canada – where it opened an office in Toronto – and launched a new software and tech 'building' offering. Amid growing demand in the UK, the consultancy has turned its attentions back to British shores once more. The UK represents the world’s second largest individual market for consulting services, and with the Northern Powerhouse project seeing business boom in the North-West in particular, Slalom has opted to launch a new Manchester office. While the move to a fast-growing region is understandable, it comes after venture capital funding fell by 30% in the North West in 2018. The haul was worth £122.2 million, down from £173.4 million in 2017, while the North as a whole saw the same 30% venture capital drop. Despite that, Slalom hopes its second UK location at Peter House, in the heart of Manchester’s innovation and academic district, will allow it to tap into the city’s deep talent pool, while investing in the development of its existing team members to strengthen its UK reputation. The company plans to employ 200 people in Manchester by 2025. Dave Williams, UK Country Managing Director, said, “Manchester is a city of digital enterprise with a wide range of strengths across industries including manufacturing, healthcare, utilities and consumer services – which perfectly complements Slalom’s breadth of expertise. We’re looking forward to collaborating with clients to shape their internal capabilities, building a team and making an impact on the local community.”
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5. Microsoft
Microsoft has said that it turned down a request from law enforcement in California to use its facial recognition technology in police body cameras and cars, reports Reuters. Speaking at an event at Stanford University, Microsoft President Brad Smith said the company was concerned that the technology would disproportionately affect women and minorities. Past research has shown that because facial recognition technology is trained primarily on white and male faces, it has higher error rates for other individuals. “Anytime they pulled anyone over, they wanted to run a face scan,” said Smith of the unnamed law enforcement agency. “We said this technology is not your answer.” Facial recognition has become a controversial topic for tech companies in recent years, partly because of its biases, but also its potential for authoritarian surveillance. Microsoft has been one of the loudest voices in this debate, repeatedly calling for federal regulation in the US. “‘Move fast and break things’ became something of a mantra in Silicon Valley earlier this decade,” Smith wrote in an open letter earlier this year. “But if we move too fast with facial recognition, we may find that people’s fundamental rights are being broken.” In China facial recognition has been integrated into sunglasses worn by police. Speaking at Stanford this week, Smith said the company had also turned down a deal to install facial recognition in cameras in the capital city of an unnamed country. He said doing so would have suppressed freedom of assembly. Activists worried about the malicious uses of facial recognition often point to China as a worst-case example. The Chinese government has deployed facial recognition on a huge scale as part of its crackdown on the largely Muslim Uighur minority. Activists say the result has been a digital surveillance network of unprecedented reach, which can track individuals across a city and produce automated warnings when Uighurs gather together. But despite concerns, facial recognition is also becoming more common in the West, even if it’s not part of a centralized system, as in China. The technology is being installed in airports, schools, and retail stores, and retrofitted into existing surveillance systems.
6. Accenture
Accenture has announced the acquisition of Irish consultancy Enterprise System Partners. The deal further strengthens Accenture Industry X.0, on the back of two other deals for the manufacturing-centred arm of the firm. The Irish consulting market is worth just under €700 million, and has seen strong growth in recent years, as businesses look to insulate themselves from potential Brexit headwinds. (Although it must be noted that during the current political impasse, there has been quite considerable business growth both sides of the Irish sea). Digital technology is increasingly seen as vital for companies looking to grow and adapt to changing business arrangements and systems, benefitting a range of Technology Services organisations.
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In March 2019, this saw Meritsoft, a Dublin-based specialist financial services software company, acquired by Nasdaq-listed IT services group Cognizant for an undisclosed sum. The move came as another part of Cognizant’s continued shift toward focusing on cloud computing, cyber security and analytics. Cognizant is aggressively pursuing new acquisitions, as it is competing with companies more than willing to supplement organic growth with new purchases. These include the major Indian IT companies such as Tata Consultancy Services, Wipro and Infosys, as well as Dublin-listed Accenture. In 2017, Accenture announced plans to spend a huge $1.8 billion on acquisitions to strengthen its global outfit – significantly more than what its biggest rivals have spent in the past years combined. In both years prior to that, the global consultancy spent more than $900 million buying companies, driven by an upsurge in demand from Fortune 1000 clients for digital and IT solutions. Indeed, 2019 looks set to continue the trend, with the firm having already spent roughly $515 million on acquisitions in fiscal year 2019. According to Interim CEO David Rowland, the firm expects to spend $1.5 billion overall on deals, an estimate revealed during the consulting company’s Q2 fiscal 2019 earnings call. The deals align with “The New” – an Accenture strategy that pushes the company deeper into digital, cloud and security services.
With an eye toward those particular markets, the company has acquired 15 businesses for a combined $515 million in the first half of fiscal 2019 (about $34 million per deal, on average). This includes seven acquisitions in Accenture Interactive; three in Industry X.O; and four in Technology – including an emphasis on SAP and Oracle platforms. It is worth noting that this leaves Accenture with roughly $1 billion of its war chest still to play with.
Rowland remarked of the deals, “If you look at Technology, three of those were directly tied to deepening our skills and the platforms. So I think there were a couple in Oracle and one SAP, as an example. There was another one around data and analytics. And then we had several vertical specific acquisitions, several in financial services, as an example.” Accenture’s latest purchase is Enterprise System Partners (ESP). Founded in 2003, ESP boasts 200 professionals with manufacturing, process, and IT knowledge. The firm, based in Cork, Ireland, will join the Accenture Industry X.0 team in a move aimed at bolstering its manufacturing capabilities for pharmaceutical, biotech, and medical device clients globally. ESP is a key purchase for Accenture, as it brings niche expertise in manufacturing execution systems (MES) and serialisation. MES is used to digitally track and document the production process, providing the groundwork for more automated and analytics-driven manufacturing and supply chains. Serialisation allows life science companies to digitally track each saleable unit from the packaging line all the way to the patient. It is the latest of several deals Accenture has made to expand its Industry X.0 wing in Europe and North America, having acquired Mindtribe and Pillar Technology in August 2018 to help with the growth. Ben Salama, a Managing Director who leads Accenture Industry X.0 in the United Kingdom & Ireland, said, “Digital technologies are fundamentally transforming the factory floor. With ESP’s manufacturing solutions and our Industry X.0 capabilities, we can help clients take advantage of engineering
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and product life cycle management, advanced analytics, and artificial intelligence for a flexible, efficient, and cost-effective production process.”
7. Atos
Atos has joined forces with CloudBees and Google to help customers modernise their application cloud development practices on Google Cloud. The solution will look to supply a holistic service which can provide clients with a managed platform for the software delivery process. As today’s IT industry continues to expand thanks to innovative new technologies including cloud-based solutions and Blockchain technology, making digital transformation indispensable for companies in every industry, development and operations (DevOps) has come to be seen as indispensable in bettering communication and collaboration between product managements, software development and IT operations. As a result, DevOps toolsets already constitute a multi-billion dollar industry. As businesses look to get the greatest levels of agility and scalability from DevOps, while reducing IT spend to build and automate development pipelines, a collaborative effort from technology leaders has yielded a service aimed at helping clients do just that. Designed for enterprise customers, Atos and CloudBees have created a solution to bring a unique set of capabilities to organisations in their digital transformation journey. Based on the Google Cloud Platform, Application Transformation Services helps teams modernise applications, as well as the way they are deployed and managed. The solution will include a number of application and data services, including Atos’ Application Transformation Services, CloudBees Core, and Google’s Cloud platform, and through this new partnership, Atos plans to build a DevOps platform on Google Cloud that’s powered by CloudBees Core. Michael Kollar, Senior Vice President for cloud engineering at Atos, said of the move, “As a global digital transformation leader, we look forward to working closely with CloudBees and Google Cloud, two acknowledged leaders in their respective fields. We ultimately help organisations better harness the power of DevOps and transform application development methods from a traditional approach to a model that enables hybrid / multi-cloud development.”
“As forward-looking organisations continue to focus on digital transformation initiatives, they are increasingly seeking assistance from trusted service providers for the management of their DevOps operations,” added Francois Dechery, Chief Strategy Officer at CloudBees. “By combining the power of a large managed service provider and a leading global cloud provider with our CI/CD solution, we’re helping customers to more effectively and efficiently modernise.”
Kevin Ichhpurani, Corporate Vice President of Google Cloud’s global partner ecosystem, concluded, “We’re proud to work with both Atos and CloudBees to help enterprises modernize through DevOps. Our work together makes the best of CloudBees available on GCP, which customers can deploy seamlessly across on-prem and public cloud platforms. This collaboration is a great example of how we’re able to create new value for customers through our partner ecosystem.”
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8. EY
EY has struck a deal with Thomson Reuters to purchase its Pangea3 business. The acquisition will significantly strengthen EY’s global legal offering, with all of the Big Four currently making major headway and looking to exploit the lucrative legal services market in earnest in 2019. The Big 4 already boast larger headcounts than many traditional law firms and offer a more holistic, end-to-end service. As various consulting firms’ forays into the advertising world have similarly shown – an enlarged workforce is one major route to winning over new clients. KPMG is rapidly developing its offering in the sector, moving to launch its UK legal presence in 2019. Meanwhile, PwC boasts a global total of 3,500 lawyers, and Deloitte has around 2,000. EY has also been working diligently to expand its legal offering, recently striking a deal to purchase Riverview Law. The acquisition was intended to assist and scale the EY Law legal managed services offering, while helping EY clients to increase efficiency, manage risk, improve service transparency and reduce the costs of routine legal activities. Now, amid booming demand from multinational organisations for legal services, EY has announced an agreement for the acquisition of Pangea3 Legal Managed Services from Thomson Reuters. Pangea3 offers global legal managed services, with more than 1,000 legal professionals across eight service delivery locations on three continents. The firm leverages legal, technical and business-process talent in quality, cost- effective centers, working to assist clients in mitigating legal risks, reducing burdensome costs and providing continuity and scale to budget-strapped legal teams. The transaction is expected to close in the second quarter of 2019, subject to the satisfaction of various closing conditions, at which point it will bolster the ability for the practices of EY Law to help clients transform their operations and deliver meaningful value to their businesses. The move strengthens EY Law in three core areas: lifecycle management; regulatory risk and compliance; and investigations and litigation. It also offers a welcome boost to the headcount of EY’s legal wing, which comprises more than 2,400 lawyers in 84 countries.
Commenting on the move, out-going EY Global Chair and CEO Mark Weinberger said, “This new enhanced offering will make EY one of the leading professional services organizations for global legal advisory services and legal operations services, including legal function advisory, managed services and technology. The acquisition is an example of how EY is working to provide clients with holistic solutions, which are enabled by technology.”
Kate Barton, EY Global Vice Chair – Tax, added, “The EY Law practices will connect the practice of law with the business of law globally. Legal departments recognize that the future lies in aligning more closely with broader business transformation and we are uniquely positioned to offer a globally consistent, leading approach across the enterprise.”
The above information has been sourced from a range of media publications and statements made in public company announcements. Latitude Executive Consulting acknowledges all copyright and trade names. The information does not represent Latitude Executive Consulting’s view or opinions. Copyright, Latitude Executive Consulting, 2019.
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