When I left Microsoft at the end of 2005, I joined Capgemini. And lasted all of 6 months. A re-org nuked the job I was hired for and, whilst a good alternative position was offered, I decided to jump ship. The re-org didn’t make much sense. It seemed to have been done more to satisfy internal politics than to improve business prospects. My parting thought was that Capgemini would be lucky to last five years in its current form. The I.T. services market was looking too competitive to allow for profits to finance egos. Companies like Wipro and Infosys didn’t appear to have the same baggage and were making higher margins on lower rates. Both were committed to increased growth in European and US markets. Fast forward 2 years and, catching up on news over Xmas, it appears that both have been having a go at taking over a reluctant Capgemini:
- Wipro Reported Seeking To Acquire Capgemini (Forbes, Dec 07)
- Capgemini ‘not talking to Wipro’ (The Register, Dec 07)
- Infosys Rumored To Eye Bid For Capgemini (Forbes, Jun 07)
I never thought a take-over would be on the cards. To marry old school with new school usually puts the divorce lawyers on standby. It looks like I.T. services could get a little bumpy in 2008. I don’t think Capgemini is alone in its traditions.
A few years ago, I was presenting to a young financial services company. They were committed to leveraging the Internet to increase revenue and lower operating costs. Their CIO outlined the business strategy and included the comment: ¨We’ve given up on management consultants – they all say we must have a mainframe computer because we are a bank. We will never buy a mainframe.¨ The market value of that business grew 80% over the following year. As industries undergo transformation, the consultants servicing those industries need to change too.