Capgemini NL: disruptive, desperate, or both?

Capgemini has made headlines in the last past months, starting July 2012. Dutch headlines, that is, as Capgemini NL decided to start a large reorganisation that involves laying off hundreds of people and restructuring the organisation so it can meet the current challenges any system integrator faces: a changing market, and shifting revenues

This post will show you why Capgemini is desperate, and whether it is disruptive. It is innovative for sure, and maybe leading the way for others, or just postponing the inevitable in the longest way possible

The Netherlands exit the rusty labour market

Yesterday, our new government finished negotiations. The two parties that together form a majority, VVD and PvdA, have reached agreements on their mutual policies for the next four years. It's a challenging combination of right-wing (VVD) and left-wing (PvdA).
Even though these definitions vary considerably across the globe, I think I can suffice by saying that VVD generally favours the rich, while PvdA favours the poor

But, all that doesn't matter. The topic for this post is the definitive decision that severance pay will be maximised at 75 thousand euros - period. Where it currently would be double, triple or even more of that

Independents flood the NL labour market

Brace yourself for 9 years of labour population make up in the Netherlands. It's a long yet short story.
We Dutch have always been great entrepreneurs. Disregarding the consequences of our actions over the last centuries, and the actions themselves, objectively put we have left an enormous footprint in the world for such a small country

In the 1600’s the Dutch East India company was the largest private company in the world with 50,000 employees. We have been entrepreneurs ever since - although one would claim differentl;y given the figures of our labour population. Those have changed over the last decade, as you can see in the figures above

Microsoft, the bleedin' advertisers

This week Microsoft produced their annual report for 2012. It's been commented on by many and the main theme seems to be that they've reported their first quarterly loss since ages (or ever).
Well, yes. And so what?

The Online Services Division, a eufemism for "we wanna go where Google went" has been a bleeder for years. Its mission:

Online Services Division (“OSD”) develops and markets information and content designed to help people simplify tasks and make more informed decisions online, and that help advertisers connect with audiences. OSD offerings include Bing, MSN, adCenter, and advertiser tools. Bing and MSN generate revenue through the sale of search and display advertising, accounting for nearly all of OSD’s annual revenue

The graph above reflects revenue (straight line) and operating income (dotted line) from 2007 till 2012. Where the other divisions flourish, it's clear that OSD doesn't.
However, OSD has changed quite a lot over the years. Here are the figures for the historic OSD up from 1999 till now:

Apple Q3 2012 - for better or worse?

Yesterday Apple announced its figures for Q3 2012.I decided to have a good look at them, given the news and blog posts that flew around. Here are the clean stats:

2012 Q3

Revenue of $35.0 billion
Net profit of $8.8 billion
Gross margin 42.8%
26.0 million iPhones - 28% growth
17.0 million iPads - 84% growth
4.0 million Macs - 2% growth
6.8 million iPods - 10% decline

2011 Q3

Revenue of $28.6 billion
Net profit of $7.3 billion
Gross margin 41.7%
20.3 million iPhones - 142% growth
9.25 million iPads - 183% growth
4.0 million iMacs - 14% growth
7.5 million iPods - 20% decline

Good or bad, or anywhere in the vast grayscale in between? Let the data and graphs tell the truth...

2004-2011 financial analysis: Non-traditional SI (Indian players and IBM)

Yesterday I published my financial analysis of 4 traditional system integrators: Accenture, Atos Origin, Capgemini and Logica.
In a conversation I got asked why IBM wasn't on the list, and my answer was somewhere along the line of "it's not a pure player". Also, I hadn't published my Indian friends yet, so here are another 3 "service providers" if you may: IBM, Tata and Wipro. Different worlds? Try universes

Traditional system integrators 2004-2011 financials

Traditionally, 31st of March is the date that all my favourite system integrators (SI) have released their annual report for the previous year.
Oddly, however, I've seen some strange changes this year - for the first time. I could -and will- even say that traditions have been broken with

Wanted dead or alive: any Facebook user, $ 125 reward

With the upcoming IPO of Facebook this week, I got a little worried. I told a few people "Mark my words, this IPO is going to blow the Social Media bubble once and for all" and even "Wouldn't be surprised if FB's IPO is going to start the final leg of this crisis and finish everything off".
A bit gloomy, I admit. But I really need to get something off my chest here: you could put a value on people, but not in this context, and certainly not at a price like this

Amounts have been predicted as low (yes, "low") as $ 10 billion, and as high as $ 100 billion for Facebook's IPO. At their claimed amount of 800 million users, who miraculously seem to be logging on every second day at the least, that would mean at least $ 12.5 per user, at maximum $ 125.
A maximum amount of one hundred and twenty five dollars per Facebook user, dead or alive - would you offer such a ridiculous amount of money if it were your own? Of course not

Apple margin per device - expressed in Chinese

[Image by Sven Teschke]

An article in the New York Times published 2 days ago suddenly gained a lot of traction and got discussed, reposted and reblogged today: Apple making money off of the United States, while directly employing "only" twice as many employees in the US than overseas - but indirectly more than ten times those combined, none of which in the US

I've published on Apple's revenue and profit a few times now, last of which was two months ago. A historical year for Apple: it surpassed Google on profit per employee - operating profit so before taxes, by the way

Consumer and enterprise IT company analysis

In January this year I did an analysis of "classical" US IT companies: Google, Microsoft and Apple, which are targeting consumers, and Oracle, SAP, IBM and HP, which are targeting companies.
Yes that's a fairly big generalisation but please allow me to do so...

This is the update which includes the next year, I need to find a good moment to do so because they have different book years and being US-based or European also means different publication dates for the same results.
Anyway, I took revenue and operating profit (also known as operating income, earnings from operations, income from operations, income before income taxes), and here are the absolute figures for "GMA":

Innovation - today's Golden Calf

This week I had a conversation about Innovation and IBM. Vijay Vijayasankar wrote a follow-up post on that as he was forced to "leave early" - this is my reply to that. I think the three of us usually agree pretty much on pretty much everything. And this was an awkward one really

Does Google get enterprise? No - so what?

After a small conversation with Frank Scavo - whom I hold highly - it struck me: we old enterprise boys that keep kicking the #socmed chins might be on our way to retirement. Not saying that Frank's one of them, but I certainly count myself to the pack as I've only been around multinationals and global companies for the past 15 years. I've never consulted a national company - save governmental agencies - let alone SMB or even smaller

Capgemini is rising to the occasion

It's May, the time for most "calendar-reporting companies" to release their annual reports. Capgemini is one of them.
Although the link to their 2010 Consolidated Financial statements on their investor page results in a 404, I managed to lay my hands on some partial reports in the meantime, giving me the figures for 2010

A new kind of Capgemini Consulting, errrrr attrition

I was alerted on Twitter to this thoughtless, clumsy, mindless piece by Peter Sayer on PCWorld:

Capgemini Consulting, a specialist in strategy and transformation, is about to transform its own strategy for the second time in two years. To cope with the change, the company plans to recruit up to 1,000 staff this year, predominantly younger workers with social media and "digital transformation" skills, although it expects other staff to leave

Its title? Capgemini Consulting Readies 'a New Kind of Consulting'

Twitter delegates the monetisation strain to its developers

On the Twitter Development Google Group, Twitter announced today that they'll stop whitelisting. Whitelisting basically lifts an application developer's limitation of 150 Twitter requests per hour, that mere mortals suffer from

Beginning today, Twitter will no longer grant whitelisting requests.
We will continue to allow whitelisting privileges for previously
approved applications; however any unanswered requests recently
submitted to Twitter will not be granted whitelist access

Unfortunately, my TwUniverse will be one of the latter - filed a request twice in the past months now, and never got a response

Gamification - yet another one-size-fits-all?

[Image courtesy of Johnny Mr Ninja]

I got into discussions today about gamification:

Gamification is the use of game play mechanics for non-game applications (also known as "funware"), particularly consumer-oriented web and mobile sites, in order to encourage people to adopt the applications. It also strives to encourage users to engage in desired behaviors in connection with the applications. Gamification works by making technology more engaging, and by encouraging desired behaviors, taking advantage of humans' psychological predisposition to engage in gaming. The technique can encourage people to perform chores that they ordinarily consider boring, such as completing surveys, shopping, or reading web sites

While making some pun statements about feeding dogs biscuits to make them obey, and rewarding them for doing a trick, along with some serious ones, Alan Berkson made a great statement:

Real Profitability Part V: The Aftermath

[Picture: Aftermath of San Francisco earthquake, 1906]

After the last 4 posts on the subject (1, 2, 3, 4), this is the final one
I had a few chats with respected and "bearded" analysts in the field, and realised that my unorthodox calculations would be fine as long as they'd make sense - the average analyst is only interested in earnings per share (EPS), it seems

I have a confession to make: my entire working life was spent as an expert in Systems Integration for a company commonly labeled as System Integrator. Of course I started off as a tester / programmer, but I ended up integrating any system with any other system - regardless.
System Integrators, or Consulting firms, make money by selling people: consultants. Those have hourly rates and thus can easily calculate their revenue - very few do by the way. Even if it's not on a strictly Time & Material basis, but rather project-wise, still their rates affect the project price so it's easy math.

Real Profitability Part IV: The Verdict

In yesterday's post I showed the absolute and relative revenue, profit and R&D figures of Tata Consulting Services and Wipro
The day before that, I showed the absolute and relative revenue, profit and R&D figures of Accenture, Atos Origin, Logica and Capgemini
The day before even that, I started this series by showing the absolute and relative revenue, profit and R&D figures of The Big Three Google, Microsft and Apple and The Big Four Oracle, SAP, IBM and HP

Today, it's time to pass the verdict - that is, make up my mind, and see what's on yours

Real Profitability Part III: Indian players

Part III and second-to-last of this series, at least this one will be the last one with lists of figures
In the first I gave you the Big Three
(Google, Microsoft and Apple) and Four (Oracle, SAP, IBM and HP) and there was a big difference between them. Where the Big Three make an operating profit of hundreds of thousands of dollars per employee, for the Big Four this is tens of thousands - but I'll save all conclusions for my last post.
In the second I presented the classical System Integrators (from my European PoV): Accenture, Atos origin, Logica and Capgemini

In this last post, I present Wipro and Tata Consulting Services - I have to admit it was a lot of work making heads and (sic) tails of the different layouts, the rupee, and it was nice to find out that reporting in Crores means you have to multiply by 10 million, not just one million

Real Profitability Part II: classical System Integrators

In my previous post I gave away financial stats on The Big Three and The Big Four, showing their revenue, profit and R&D - for the company as a whole but also calculated relatively for each employee

As Wim Rampen marvelously noted, the real drooling stats would be in measuring all that by customer, rather than employee - but these figures would be hard to come by, and remember this is just a one-size-fits-all calculation, not subdividing all that in hardware, software, services, licenses etcetcetc...

Still, the quest continues, and this post contains the same calculations for the classical system integrators: Accenture, Capgemini, Logica and Atos Origin. This is from my / a European point of view, I promised to do this post today and have little time but it'll give you an impression - or should I say shock?