Capgemini Europe

A winning combination

Capgemini is a global consultancy engaged in information technology, management consulting, outsourcing and professional services.  Headquartered in Paris, it employs over 92,000 people through offices in over 30 countries.  The company's clients are active in the automotive, consumer products, distribution, energy, chemicals, financial services, health care, life sciences, manufacturing, retail, media and telecoms industries, as well as the public sector.

The company underwent something of a shift in identity in April 2009, creating a new strategic business unit known as Capgemini Consulting, a move that brought all of its worldwide strategy and transformation operations consulting operations under one banner, and installed the company as the largest European consulting outfit at a stroke.  The Capgemini Consulting unit employs over 4,000 consultants worldwide and contributes some 8 percent of total revenue. Headquartered in London, Capgemini Consulting is headed by Pierre Yves-Cros, and has three practice areas, each dedicated to business transformation: strategy and transformation, operations transformation (which includes marketing, sales and service, finance and employee transformation, and supply chain management), and technology transformation (where services include "technovision," accelerated IT restructuring and consulting for CIOs).  According to the company, this new structure allows it to better utilize its global standing to benefit clients through sharing of best practices and experience across the company.

Names, more names and acquisitions

Capgemini was founded by Serge Kampf in 1967 as Sogeti, a boutique provider of IT services targeting only local French markets.  It was too successful to maintain a low profile for long, however, and by 1975, with the acquisitions of the larger companies CAP and Gemini Computer Systems, the company had a presence in 21 countries.  Kampf toyed a bit with the corporate name, working for a while as Cap Gemini Sogeti, then opting for Cap Gemini.  The company merged with the consulting unit of Ernst & Young in an $11 billion megadeal in 2000 and, apparently abandoning the earlier lessons of superfluous nomenclature, became Cap Gemini Ernst & Young.  This was short-lived, though, as a 2004 rebranding not only shortened, but compressed the name to Capgemini.  

While the company may have settled on its new slim-line branding, its taste for monster-sized acquisitions hasn't abated; in 2007, it paid $1.2 billion for Kanbay International, a global IT services outfit with a significant foothold in India.  That market has been the focus of increased attention by Capgemini in recent years, as the company has sought to establish its footprint, and a significant outsourcing presence, in the country.  The focus is an understandable one, as around 37 per cent of the company's revenue is generated through outsourcing.  Capgemini's technology unit is its largest component, meanwhile, contributing almost 40 per cent of revenue.

The right stuff

 

Through its business divisions around the world, Capgemini can legitimately claim to have a consulting empire on which the sun never sets.  That's something it puts to good use through its Rightshore global delivery model, utilizing its network of international centers to provide specialist services around the clock for accelerated delivery, applications management service, business process outsourcing and infrastructure management.  The model provides cost benefits for clients as well, translating into savings the lower cost of doing business in markets such as India, China and Eastern Europe.  The company is investing heavily in the method as well, with plans to increase the number of employees it has in India to 40,000 by the end of 2010.  This will result in Capgemini having more employees in India than in any other country, making up 40 per cent of its total workforce.

THE LATEST ON CAPGEMINI

Culling talent
July 2009

In a move to further the company's global expansion and established expertise, Capgemini announced the recruitment of Ranjan Tayal as vice president and head of its India practices.  Tayal came from among the top brass at troubled Satyam, where he operated as VP and business head for India and South Asia, and was reportedly responsible for 4 per cent of Satyam's revenue over the past four years.

Bench-pressing the EU
July 2009

The European Commission extended its contract with Capgemini Consulting (through Cap's Nederland B.V. practice) to provide eGovernment supply-side benchmarking to the EU.  Previously, the company had operated on a seven-year contract with the commission to conduct benchmark studies, which surveyed the effects of eGovernment online services to transform the public sectors of EU member states.  The new agreement extends that contract by another four years.

Moving into Romania
June 2009

The firm opened a new outsourcing centre in the Romanian town of Iasi. Part of the company's plan to expand its outsourcing presence throughout Eastern Europe, the new centre is situated in one of Romania's largest University towns, giving Capgemini easy access to a deep pool of qualified and (ideally) skilled labour. Initially, the centre will offer service desk support for Capgemini clients, although where those clients may be (and hence the languages required) was unclear.

Energy expertise
January 2009

A Capgemini study highlighted the problems facing the long-term implementation of renewable energy into national energy grids.  According to the report, many utilities companies are being put off by the complex integration of large-scale wind farms and their variable power loads, hampering the development of green energy projects.

Also in the energy field, a November 2008 Capgemini report provided a startling assessment of the state of the U.K.'s energy production.  The report claimed that, without significant increases in investment in power generation in the next decade, the country will not be able to meet demand for power.  What's holding it back?  The paper blamed dwindling North Sea gas reserves, a move toward less effective renewable technology and the closure of around one quarter of the country's energy plant capacity. 

Opening the Czech book
November 2008

In a move that reinforced its position in the emerging Eastern European market, Capgemini entered into an agreement to buy Czech IT services and consulting company Empire.  The buyout, which includes a majority stake in Empire's subsidiary Sophia Solutions, a local business intelligence and data warehouse expert, significantly increases Capgemini's client base in the Czech Republic.  Among those new clients are some of the leading players amongst the financial services and telecom industries, as well as several major Czech public-sector institutions. 

Heading for the clouds
November 2008

Recognizing a trend that seems likely to become a standard of business life in future years, Capgemini added a new option to its suite of IT consultancy options in November 2008: cloud computing.  Not that it's going to be doing anything like hosting software, running data processing or storing clients' data itself, the company's UK wing signed an outsourcing deal for all of that with Amazon Web Services, a subsidiary of retailer Amazon.com.

Capgemini's role in the cloud sphere will be limited initially to a new cloud computing center of excellence, which will be staffed with a team of Amazon Web Services-trained professionals.  Located in North America, Europe and India, they will help Capgemini's clients evaluate and implement the appropriate web service offerings.  Those, meanwhile, will initially come in three major areas of technology: Microsoft Sharepoint in the cloud, Oracle ERP in the cloud and cloud-based development and testing of applications.

Public-sector success
October 2008

In the UK, Capgemini was chosen to carry out operational service and IT improvements by West Sussex Council.  The aim of the project is ultimately to find cost savings for the council that can be passed on to residents in the form of reduced council tax bills.

The company won a similar contract from Dorset County Council in August 2008, while in April of that year London's Croydon Council signed a five-year contract extension with Capgemini to continue the ongoing transformation of its local government services.  The longest running private finance initiative agreement of its kind in the UK, the five-year extension is worth £83 million and covers IT and telecommunications support, which Capgemini has provided for the council since 2003.  

Going Dutch
July 2008

Capgemini announced a â'¬255 million deal to purchase Getronics PinkRoccade Business Application Services BV, a division of Getronics PinkRoccade.  The company is one of the top IT services providers in the Dutch public sector, offering solutions that address the entire applications life cycle, from applications management consulting to project development, integration and implementation.  Its clients include planning agencies, state administrations and social security bodies, plus insurance and banking corporations outside of the public sector.

Shuffling the exec deck
May 2008

The company unveiled Olivier Picard as its new development director.  Picard joined the company from Alcatel Lucent, where he had served as a member of the executive committee, leading the Europe and South region as president.  His appointment is the latest in a string of senior-level appointments at Capgemini in recent years. In February 2007, for example, the company named Lanny Cohen as CEO of the North American project and consulting operations.  Cohen's predecessor, Salil Parekh, became executive chairman of Capgemini India, taking on responsibility both for overseeing growth in the region and for smoothing the transition following the Kanbay International acquisition.  Another change in 2007 was the appointment of Henk Broeders as head of Asia Pacific and Continental Europe, which covers Benelux, Scandinavia, Germany, Italy and Eastern Europe.  

Applying some (Uni)leverage
April 2008

Capgemini extended its contract with Unilever to acquire and manage the company's financial centres in Chile and Brazil.  The deal increases the consultancy's outsourcing foothold in South America, following the opening of its first centre in Buenos Aires in November 2007, and will see 400 professionals from Unilever come into the Capgemini fold.

Where it falls down

Sources are unimpressed with the remuneration packages on offer at Capgemini, with many citing it as one of the main downsides of the company.  To make matters worse, they expect 2009's bonus packages to be less than healthy due to the faltering economy.  Perks aren't raved about either, with one consultant describing them as "nothing out of the ordinary".  Laptops, mobile phone compensation, company cars at a favorable lease, gym membership, restaurant tickets, health and life insurance, and broadband at home are some of the benefits respondents mention.  New mothers also get "90 per cent pay on maternity leave for at least six months", and those who near burnout can opt for "career breaks" or buy more holiday if they want.  

Focusing on the positive, the consultancy does offer a "great social life", sources say, and puts on a lot of events.  "I have played in two UK versus France company rugby matches, one in Paris and one in Biarritz.  These provided a great networking opportunity and were fully paid for by the company," explains a respondent.  In Norway, the company provides "cabins in the mountains" for its staff to use, and every quarter, the firm holds what are known as "Gold Wings awards to recognize project deliveries and exceptional work", which are described as "very encouraging".  And of course, if you like your fruit, you'll fit in at Capgemini, as the company has it delivered fresh to the office door every morning. Capgemini also supports a number of charities, including the Prince's Trust, in the UK and the Naandi Foundation.

Pushing a coaching culture

Respondents also report that Capgemini has a "large training budget per employee", as well as its own university and academy where official training takes place.  The firm "actively encourages as much training as is possible, without interfering with client commitments".  Every staffer has between eight to 10 days allocated to official training per year, from an "extensive training curriculum".  We're also told that the "corporate training facility in Paris is first class".

Sources feel Capgemini promotes a "great feedback and coaching culture", made possible through "mentoring and on-the-job training" by means of a "dedicated coach".  They describe their supervisors as "very approachable", "very accessible and hands on" more so than at competitor companies, insiders argue.  "I feel like we are one family, where no conversation is taboo and everyone has time for you if needed," states a London-based consultant.

No panic, yet

There is a "sense of realism, rather than pessimism, pressure or panic", when it comes to Capgemini's chances of coming through the recession unscathed.  The London office is particularly confident in its ability to keep revenue up, due to the large amount of public-sector work it carries out.  "We seem well placed, partly due to the amount of government work we have," says a consultant there.  Across the Channel, consultants are also quietly confident, saying the outlook is "OK, due to the strong relationship with clients and the broad expertise on a large scale of sectors not deeply impacted by the crisis, such as energy, utilities and life science".  Others are not so optimistic.  "Business is still strong, but sales opportunities are decreasing rapidly, employee morale is moderate, but fear of losing your job is increasing," an insider in Utrecht reports, while a colleague in Frankfurt states, "We will need to adapt and lay off some people if the situation does not change.  Even new methodologies, tools or topics will not help if industry is not willing to spend money for consulting."  And respondents tell us that the Stockholm office has stopped rehiring when people leave.  

Across the board, consultants agree that one of the main problems the company faces is that it "is still perceived as an IT company", and less of a management and strategy shop.  In the strategy arena, insiders admit to "witnessing a general decline in capacity over time", and believe that, in this field, the firm will have "to fight an uphill battle against stronger brands".

Better than the norm

"Where are the women partners?" asks a Paris-based source.  We're there is no discrimination when it comes to hiring women, and "female consultants are regarded in the same way as male consultants" at the company.  That said, it continues to be a "very male" consultancy, more so than other consulting firms I have worked in", says a staffer, and the "policy doesn't seem to be aimed at promoting more participation".  "There are special events on international women's day, special forums for women and the like, but nobody, especially the women, really cares about it," a source claims.  Even the Stockholm office, which has a good gender split lower down the ranks, and a female country manager to boot, only has a 20:80 ratio of women to men at partner level.  Most other offices, we're told, have lower proportions.

The spread of minorities throughout the consultancy depends on the office in which you are based.  In Utrecht, we're told that for "a consulting firm, the diversity in minorities is probably about right, but for a modern firm, it is quite low".  In fact, that office is described at "mostly white".  The same goes for the Paris office, where there is little minority representation, according to insiders.  And while sources claim the company is "very receptive to minorities", it takes a "fair approach to equality and doesn't positively discriminate just to try and meet targets".  The London office, however, is a different animal and the makeup of the office staff "seems representative of London as a whole".  "We are hugely multicultural, with 19 languages between the 35 of us," says one consultant.  But there are still fewer minorities in the management ranks, we're told.  

The same cannot be said for GLBT employees, who have attained positions at the "most senior level" of the firm, and consultants' sexual preferences are not an issue at Capgemini.  One insider tells of a transgender, former colleague and describes the support they received from top management as "absolutely first class".

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Capgemini Europe


Place de l'Etoile
11 rue de Tilsitt
Paris 75017
Phone: 33 (0)1 47 54 50 00
www.capgemini.com

STATS


  • Employer Type: Public
  • Stock Symbol: CAP.PA
  • Stock Exchange: Euronext Paris
  • CEO: Paul Hermelin
  • 2009 Employees: 92,000

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