Accenture Settles Rille Qui Tam Suit with US DOJ for $63.675 Million Monadnock Research (Vol IV, No 29) - 18 Sept 2011 MR - Accenture has agreed with the U.S. Department of Justice to settle a whistle-blower suit filed in 2006 for $63.675 million. The Qi Tam lawsuit was originally filed by Rille and Roberts alleging that Accenture submitted false claims for payment under contracts with US federal agencies for IT consulting and services. The Justice Department characterizes the settlement as Accenture agreeing to resolve the claims that it received kickbacks for recommendations of hardware and software to the government, fraudulently inflating prices and rigging bids. Accenture continues to vigorously deny the allegations and says that the firm and the Justice Department have settled only to avoid the additional time, inconvenience and expense that would come with protracted litigation. The Accenture kickback allegations were part of a larger investigation of government technology vendors that has resulted in numerous settlements to date with firms that include IBM, PwC, CSC, Oracle, Hewlett-Packard, EMC, and Cisco. The total of the settlements paid by IBM, PwC, and CSC were around $6.5 million. That aggregated total was just a fraction of that paid by each of the firms that waited to settle. So there was clearly a significant premium charged to Accenture and the other firms that refused to address the risk early. Accenture's settlement, as well as that of Oracle, were in the range predicted by Monadnock Research in a September 2010 publication. This Research Note includes MR analysis and perspective on: the cost to firms of waiting to settle; why clients need to better understand firm partnerships, since acting in the client's best interest is often not in the firm's best interest; related case settlements and supporting documents, including complaints; and recommendations on what clients and firms should do to mitigate associated risk. (2 graphics, 1,950 words) . . . More
And in other news: Infosys, FTI, Capgemini, BearingPoint, Porsche, IBM, and Navigant Monadnock Research - 29 July 2011 (MR) Infosys says whistleblower's allegations inaccurate; Announces quarterly results. FTI Consulting launches international arbitration service in Singapore. BearingPoint Directors to face $1.88 billion suit. Capgemini introduces social media IT service to complement its "Social Insight into Action" consulting. Navigant announces results that beat analyst estimates. Navigant acquires Ignited Discovery. Porsche Consulting to establish US subsidiary in Atlanta. IBM Announces New Innovation Lab Dedicated To Technology Services. (1040 words) . . . More
Consulting Leadership News: Ernst & Young, KPMG, Accenture, Capgemini, PwC, NERA, Deloitte, BearingPoint, Navigant, and BCG Monadnock Research - 29 July 2011 MR - Ernst & Young announces 548 new partners worldwide; Appoints Herb Engert as the new Americas Leader of Strategic Growth Markets. KPMG International Chairman-elect, Michael Andrew, appoints global leadership team. Accenture names Paul Daugherty as Chief Technology Architect and Gavin Michael Chief Technology Innovation Officer. Accenture has also named Jorge Benitez managing director -- North America and Chief Executive. Capgemini will train 1,500 architects and developers globally on the Windows Asure cloud platform to support new partnership. Aon Appoints Greg Besio as Chief Human Resources Officer. BCG named former ING Group COO, Thomas J. McInerney, as Senior Advisor. PwC US Appoints Robert W. McCutcheon as New Industrial Products. Leader. Energy Expert Scott Bloomberg Joins NERA Economic Consulting. BearingPoint appoints 6 new Partners. Deloitte appoints Chris Harrop to lead nuclear capital programs. Navigant appoints William Hardin within Disputes & Investigations practice. Navigant appoints William Hardin within Disputes & Investigations practice; Adam Borison, PhD, has joined the firm's Energy Practice as a Director; Names Adam Borison, PhD, as Energy Practice Director (4,800 words) . . . More
IBM Introduces Business Process Management Consulting Practice Monadnock Research - 11 Apr 2011 MR - IBM has introduced a new global consulting practice to help clients improve core business process performance, including marketing, human resources, and finance, and industry-specific business processes. The practice will draw upon the expertise of IBM consultants from around the world. Consultants will provide services across all phases of process transformation, from enterprise strategy and governance to specific process solutions. IBM says it is experiencing double-digit BPM software sales growth and growth in consulting engagements across several major industries. The new practice will be part of IBM's GBS Application Innovation Services practice. (530 words) . . . More
Oracle Reaches $46 million Settlement with U.S. Justice Department in 2004 Sun Systems Integrator Whistleblower Suit Monadnock Research (Vol. IV, No. 4) – 12 Feb 2011 MR - Oracle has agreed to pay $46 million to the U.S. to settle claims that Sun Microsystems, who completed its merger with Oracle a year ago, independently and in complicity with systems integrators, submitted false claims to the General Services Administration (GSA) and other federal agencies on its behalf. The settlement resolves allegations under the False Claims Act and Anti-Kickback Act that Sun paid systems integrators kickbacks to recommend the purchase of Sun products by federal agencies. It was also in the range predicted by MR in September 2010. According to the allegations in the original qui tam whistleblower suit, Sun executed agreements with consulting firms that provided for the payment of related fees. The suits were filed by Norman Rille and Neal Roberts in September 2004, and were intervened by the U.S. Justice department in April 2007. The settlement also resolves claims that Sun's 1997 and 1999 GSA contracts were improperly priced because Sun misrepresented information to GSA contracting officials during negotiations. It also settles claims that incomplete and inaccurate information submitted by Sun resulted in defective pricing of its contract with the U.S. Postal Service and GSA contracts held by two Sun resellers. The Sun kickback allegations are part of a larger, ongoing investigation of government technology vendors that has resulted in six settlements to date with firms that provide consulting and systems integration services. (Research Note includes copies of second amended qui tam complaint, DoJ intervention complaint, and historical perspective and documents detailing complaints and settlement of related matters. 1,830 words) . . . More
Expert Network "Consultants" Charged in Alleged Insider Trading Scheme Monadnock Research (VIII N62) - 17 December 2010 MR - Consultants working as independent contractors and other employees of a Silicon Valley "expert network" firm have been indicted in an alleged scheme that channeled inside information from executives at some of the world's largest technology companies to hedge funds and other financial firms. The firm, Primary Global Research (PGR), is based in Mountain View, California and its early leadership team previously worked for IBM, Intel, Bell Labs, the Gerson Lehrman Group, Bear Sterns, Alex Brown, CSFB, AMD, and numerous other financial and technology firms. PGR itself was not indicted in the scheme, and five executives at financial and technology firms are cooperating in the investigation. PGR consultants also worked for some of the technology industry's leading firms, including Apple, Research In Motion, AMD, Dell, and Seagate. Monadnock Research co-founder, Mark O'Connor, coined the "Expert Network" service category for legal and ethical uses in his knowledge management research at the Yankee Group in the late 1990s. (Research Note includes complaint, MR insights, 925 words) . . . More
Accenture to Purchase Ariba Sourcing Services and BPO Operation Monadnock Research (VIII N46) - 7 October 2010 MR - Accenture has reached a $51 million agreement to purchase the sourcing services and business process outsourcing (BPO) assets of Ariba. Under the terms of the deal, Accenture will enhance its sourcing and procurement services offering by acquiring Ariba's category management and sourcing process expertise, and strategic sourcing execution resources. Ariba's sourcing technology and Global Services software implementation organization are not part of the deal. Around 160 Ariba consultants and staff are expected to join Accenture when the transaction is concluded. (390 words) . . . More
HP $55 Million Settlement with U.S. DoJ for Alleged Procurement Process Violations Highlights Stiff Penalty for Denial of Allegations Monadnock Research (VIII N39) - 3 September 2010 MR - The U.S. Department of Justice (DoJ) has reached an agreement with Hewlett-Packard where HP will pay $55 million to settle allegations that it defrauded the General Services Administration (GSA) and other federal agencies. Previous guidance by HP estimated the amount at $47 million. HP has denied that it violated any laws in its settlement. The agreement, and the recent $87.5 million settlement involving EMC in an associated case, highlights the stiff penalty the DoJ is imposing on firms when they deny their failure to comply with Federal procurement guidelines for products and services. Research Note includes: HP settlement details; Summary of allegations and settlements involving numerous other consulting firms in associated litigation; Copies of civil complaints, related documents, and results of government study on whistle-blower lawsuits. (1,515 words) . . . More
Hewlett Packard Settles with U.S. Justice Department Over Alleged GSA Contracting Violations Monadnock Research (VIII N28) - 2 August 2010 Monadnock Research Note - Hewlett-Packard has reached a settlement in principle with the U.S. Department of Justice to resolve an investigation into HP's GSA Multiple Award Schedule contract and civil charges associated with the "Rille" complaints and alleged kickbacks involving HP. The settlement awaits approval of the U.S. Justice Department, the Arkansas Federal Court, and Federal agencies involved in associated procurements between 1997 and 2007. Several other firms also charged in Rille complaints that resolved their matters years ago, settled for aggregated amounts that were 7 times less than the amount HP appears poised to pay. HP admits to no improper conduct in the settlement. Research Note includes a copy of the HP complaint, filed under seal in April 2007. (635 words) . . . More
SAP Acquisition of Sybase: Consulting Client Implications Monadnock Research (VIII, N17) - 14 May 2010 MR - In a new escalation of the SAP Oracle enterprise application war, SAP has agreed to acquire Sybase for $65 per share, valuing the company at approximately $5.8 billion. The transaction is expected to close in the third quarter of 2010. This research note offers MR's perspective on the consulting client implications of the Sybase acquisition. (745 words) . . . More
IBM to Revamp U.S. General Services Administration's Acquisition and Procurement System Monadnock Research - 18 February 2010 MR - The U.S. General Services Administration (GSA) has awarded IBM a services contract to modernize the system that federal agencies and their suppliers use to source equipment, supplies, information technology (IT), and telecom services. The award has a contract value of $74.4 million over eight-years. Northrop Grumman, Vertex Information and Computer Consulting Services, and Collins Consulting will work with IBM on the project. (300 words) . . . More
IBM Global Business Services Revenues Down 10 Percent for 2009, but Margins Up Monadnock Research - 21 January 2010 MR - IBM's Global Technology Services revenue was down 4.9 percent in U.S. dollar terms to $37.35 billion, but GTS gross margins increased by 2.4 percent to 35 percent. Global Business Services revenues decreased by 10.1 percent to 17.65 billion, with GBS gross margins increasing by 1.5 percent to 28.2 percent. Total revenues for IBM were down by 7.6 percent from $103.63 billion to $95.76 billion. Despite the revenue declines, in services revenues in particular, IBM managed to increase net profit margins by 8.8 percent to $13.43 billion, primarily driven by its shift to higher margin products and services and execution of strict expense management. Net margins were 14 percent, up 2.1 percent over fiscal '08 levels. (300 words) . . . More
Fourteen More Professionals, Executives, and Financial Institution Leaders Charged in Ongoing Insider Trading Scandal, Including Former Ropes & Gray Attorney Monadnock Research (VII N48) - 5 November 2009 MR - Criminal charges were filed against 14 more Wall Street professionals and attorneys related to an ongoing investigation into a large U.S.-based insider trading ring. Civil charges were also filed by the SEC against 8 of those individuals, including Arthur Cutillo, an attorney and (now former) Associate at law firm Ropes & Gray. Cutillo allegedly passed along confidential client information on Avaya, 3Com, Alliance Data Systems, and Axcan Pharma. Five of those charged have already pleaded guilty to insider trading in a scheme that allegedly netted around $20 million in illegal profits beyond the $20 million alleged in the October complaints against 6 others, including prominent executives at McKinsey and IBM. (Includes copies of criminal and civil complaints) . . . More
IBM Introduces New Sustainable Supplier Information Management Consulting Service Monadnock Research - 20 October 2009 MR - A new IBM consulting service proposes to help clients develop methods to collect, manage, and analyze supplier information for energy use, environmental impact, quality, safety, cost, efficiency, and labor practices. The service proposes to help clients improve supply chain efficiency, lower costs, and reduce waste and environmental impact, and report sustainability information to business partners, regulators, and other key stakeholders. . . . More
McKinsey Director, IBM Executive, and Four Others Face Criminal and Civil Charges Monadnock Research (VII N46) - 19 October 2009 MR - The Manhattan US Attorney's office and the FBI have charged six prominent executives with multiple counts of securities fraud and conspiracy for their alleged involvement in an illicit information cabal. Authorities say this is the largest hedge fund insider trading case in US history. Related civil charges were also brought by the SEC. Among those charged was McKinsey Director Anil Kumar, a senior firm principal, capital markets practice leader, and KPO thought leader. Kumar is also an Indian Business School founding director. IBM Senior Vice President Robert Moffat Jr. was also among those implicated in the scheme. Moffat had been responsible for IBM's Systems and Technology Group, including global procurement, until the allegations surfaced last week. Moffat was quickly placed on leave. McKinsey has also put Kumar on indefinite leave. The investment firm at the center of the probe, Galleon Management, internally announced plans to wind down its hedge fund operations. Gallium is a large investor in Huron Consulting Group, a firm in the midst of its own financial crisis. (Research Note includes full-text of criminal and civil complaints) . . . More
IBM Expands Analytical Consulting Capabilities in China Monadnock Research – 4 August 2009 IBM launched its China Analytics Solution Center, part of a global network of centers addressing what IBM says is growing demand for advanced analytics capabilities to help clients build smarter business systems and improve decision-making. The Beijing center will be staffed initially by up to 300 consultants, software specialists, and mathematicians, with plans to retrain or hire an additional 300 as demand grows. . . . More
Consulting Client Insights: IBM Transformation Monadnock Research (VII N39) - 25 July 2009 IBM's consulting revenues were hit hard in its most recent fiscal quarter. While profitability has increased, those increases have been driven largely by expense reductions as a result of changes in IBM's global delivery model; and the company has no plan to pass those savings along to clients in reduced fees. This Research Note explores the impact of IBM's strategic transformation and shifts in consulting resources on the company's ability to deliver on its promise to provide higher quality services to clients, while simultaneously providing higher margins to investors. Our Note offers perspective on IBM's Q2-2009 financial results for services, along with recommendations on what clients should do to assess the ongoing transformation at IBM and potential impacts on strategic sourcing initiatives for consulting, IT services, and outsourcing. . . . More
IBM GBS Launches Management Analytics Consulting Practice Monadnock Research - 14 April 2009 IBM Global Business Services has launched a new consulting organization that focuses on advanced business analytics and business optimization services, drawing on the firm's deep expertise in industry, research, mathematics, and information management. The organization launches with 4,000 consultants and proposes to help clients improve the speed and quality of business decisions, and to better understanding the consequences and business outcomes of those decisions. . . . More
IBM Introduces Sustainable Procurement Consulting Offering Monadnock Research – 9 April 2009 A new IBM consulting service proposes to help clients establish sustainability standards for labor practices, safety, the environment, and global supplier networks, helping clients reduce costs, and ensure suppliers are green, ethical, and safe. . . . More
Management and IT Consulting Industry Trends 2009 Monadnock Research (VII N12) - 6 March 2009 Monadnock Research has identified ten key trends that will impact buyers and providers of consulting services in 2009 and beyond. This Research Note provides details on those trends, including: shifts in distribution of category and industry spending on consulting services; increasing client focus on consulting category management; contractor/subcontractor relationship trends; innovative staffing models; flight to quality; crackdowns on sham consultancies; nationalistic sentiments; international consulting network trends; and alternatives to consultants. (subscription required) . . . More
Indian Firms Prepare for H1-B Visa Restrictions Monadnock Research - 23 Feb 2009 The current wave of U.S. domestic protectionism and political momentum is prompting India's largest technology firms to prepare to hire American consultants. Four of the top five H1-B recipient companies are headquartered in India. . . . More
Climate Change Consultants in the U.S. Face a "Make or Break" Year Verdantix (3 February 2009) Consulting firms that fail to establish their climate change expertise during 2009 will miss out on the biggest opportunity in the consulting market in the past 20 years, according to research conducted by Verdantix. CH2M Hill and McKinsey stood out -- even among the leaders -- due to the breadth and depth of their capabilities and proven track records over the last 2 years. Two Big Four firms, Deloitte and PwC, and environmental consultancies ENVIRON, ERM and ICF International, are also positioned in the leaders quadrant. . . . More
Consulting Leadership News: IBM, Satyam, KPMG, FTI Consulting, BDO, Alvares & Marsal, Navigant, Craford, vcfo, and TCS Monadnock Research - 23 January 2009 MR - IBM swaps responsibilities of global services and sales leaders; Layoffs of approximately 4,000 likely. Satyam investigators say the firm over-stated headcount by 32.5 percent, and allegedly diverted salaries to family-controlled entitles to purchase thousands of acres of land; Firm denies this, and media reports that top executives fled India to avoid interacting with investigators. KPMG names Chief Information Officer. FTI Consulting appoints Chief Human Resources Officer and Chief Administrative Officer. BDO Stoy Hayward appoints Risk Management Director within its Financial Services Group. Alvarez & Marsal appoints healthcare sector Managing Director. Navigant appoints new board member. Craford Benefit Consultants names Managing Director. vcfo appoints new Consulting CFO. TCS to freeze lateral hiring and maintain 2009 hiring plans for college grads. . . . More
IBM Introduces New Security Services After Firm Research Finds Dramatic Uptick in Cybercrime (8 December 2008) There has been a 30 percent increase in network and web-based security events over the last 120 days, with the total number rising from 1.8 billion to more than 2.5 billion worldwide per day, according to data pulled from IBM's managed security services client base of approximately 3,700 organizations worldwide. In response, IBM has introduced a set of security services to help clients reduce expenses and navigate the "perfect storm" of online cybercrime threats. . . . More
IBM Launches Cloud Consulting Services (24 November 2008) IBM announced a new suite of consulting services to help organizations take advantage of the cloud computing model, which has been gaining in popularity as a more economical and scalable alternative in some business situations. . . . More
'Most Admired Global Companies' In Contract Management IACCM - 23 October 2008 (23 October 2008) The International Association for Contract and Commercial Management (IACCM) has announced the results of a study highlighting the top 25 most admired global contract management performers. Five of the organizations ranked in the top 10 are large international providers of consulting and IT services, with IBM topping the list. . . . More
IBM GBS: Majority of Organizational Change Projects Fail IBM Global Business Services (22 October 2008) IBM recently announced the results of a study of more than 1,500 change management executives from 15 countries, which reveals that nearly 60 percent of projects aimed at achieving business change do not fully meet objectives. . . . More
VendorRate: Clients at Oracle OpenWorld Fault Consulting Partners for Poor Service VendorRate MR - Clients attending the recent Oracle OpenWorld 2008 Conference in San Francisco gave low customer satisfaction ratings to a number of leading IT services firms that implement and consult on Oracle technology and application platforms according to technology vendor performance and comparison rating firm, VendorRate. . . . More
New IBM Consulting Offering Helps Clients Make "Greener" Products (24 September 2008) IBM's new Environmental Product Lifecycle Management consulting offering helps clients make products more eco-friendly, from development and manufacturing through delivery and use, and end-of-life reclamation and recycling. The service offering addresses a broad range of products from cars and electronics to consumer products. . . . More
IBM Introduces "Green Sigma" Consulting Offering (19August 2008) IBM has introduced a new consulting offering that can help clients lower their environmental impact, increase efficiency, and reduce costs by applying Lean Six Sigma principles to energy and water usage throughout their organizations. . . . More
Former HP and IBM Global Services Executive Pleads Guilty to Federal Trade Secret Theft Charges (17 July 2008) A former vice president of imaging and printing services at Hewlett Packard (HP) pleaded guilty to U.S. Justice Department theft of trade secret charges for distributing confidential pricing information shortly after leaving IBM Global Services to join HP. HP reported Atul Malhotra's actions to federal authorities after he attempted to distribute the IBM information to HP executives. Officials from both companies fully cooperated in the investigation. . . . More
Verdantix: Buyers Beware in the Climate Change Business Consulting Boom Verdantix The embryonic climate change business consulting market is set to boom, but buyers must beware of untested offerings and gaps in consulting firms' expertise, according to a new report from Verdantix. The report applies 74 evaluation criteria covering carbon footprints, carbon management strategy, corporate strategy for climate change, global carbon markets advisory and cleantech consulting to help buyers compare the climate change offerings of 16 leading consulting firms including Deloitte, EcoSecurities, ERM, ICF International, KPMG and McKinsey. . . . More
IBM Introduces New Consulting Offering to Improve Ethics and Social Responsibility (2 July 2008) IBM has introduced a new set of consulting offerings that it says can help clients understand and improve corporate social responsibility, from carbon management to labor practices, improving competitive positioning, and appeal to consumers and other stakeholders. IBM says that it can help clients improve corporate social responsibility, and increase revenue and market share simultaneously. . . . More
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