Hackers Target Brazilian Government

Just one week after Brazillian IT buff Mark Hillary posted an article on IT Decisions expressing concern over Brazil’s lacking cyber security measures, the country experienced its largest cyber attack in history.  

The worst part of this attack occurred Friday, when hackers briefly posted an ominous message on the IBGE (Brazil’s main statistical institution) website:

“This month, the Brazilian government will suffer the highest number of virtual attacks in its history.  These attacks are a protest by a nationalist group that desires to transform Brazil into a better country.”  

Apparently, hackers from Fail Shell and the Brazilian arm of LulzSec took down the government site through use of robotic computers, using billions of access requests to bombard the site until it finally shut down.  The Brazilian government reported no evidence of data loss, but websites that have suffered attacks include the Brazilian Tax Authority, the IBGE, the Brazilian Senate, and the Ministry of Sports.  

Displayed below, LulzSec won a hacking competition and placed its mascot on the Black & Berg Cybersecurity Consulting homepage.

Brazil received below average marks from the Global Competitiveness Report in the Cyber Security and IP Protection category, ranking 89th out of the 139 scored countries. To date, all attacks have been directed towards governmental agencies, but such vulnerability in Brazil’s cyberspace could mean trouble for the country’s reputation for world-leading financial and banking software.  

Read more on the attacks from the Wall Street Journal.

Indian IT Companies Outsource Jobs to US?

Outsourcing has truly come full circle.

One of President Barack Obama’s most popular promises was his commitment to stop the outsourcing of American jobs to India. In a unique twist, some of the Indian companies he targeted are now hiring unemployed Americans by the thousands for BPO jobs, as the escalating unemployment rates have made US hires financially attainable for Indian providers.  However, it’s not cost savings but the “local knowledge, efficiency, and increased socialisation” provided by US workers that has Indian IT companies hiring from within the US.

For one, Aegis (the BPO branch of the Mumbia-based Essar Group) currently employs 5,000 US citizens with plans to hire 10,000 more by 2013.  According to an Aegis spokesperson, clients appreciate having local US agents attend to their calls, so Aegis plans to respond by increasing the number of local agents.  Other companies, including Infosys, India’s second largest IT company, Genpact, TCS, and Wipro either have large centers developed in the US or have plans to develop one within the year.  

Many industry leaders including Ameet Nivsarkar, spokesperson for IT provider Nasscom, argue that this trend is a very logical step for the growing IT market in India.  “Most of the multinational hire locally to strengthen their base.  As Indian IT companies look at larger markets and move up the value chain, it makes sense to include local people,” Nivsarkar said.

Read the full story here from Business Today.

Is TPI the latest advisory firm “on the block”? Is Deloitte on the prowl?

We recently blogged about Equaterra and KPMG and we hear that talks are continuing.  Now the grapevine says that Deloitte may be close to a deal to buy TPI. ISG acquired TPI with the intent to acquire other services firms but that has not worked out.  With no acquisitions, the stock in the doldrums, and advisors leaving, investors must be getting restless.

The key to the success of any transaction is the retention of people (good ones anyway). It will be interesting to see how the compensation model of Deloitte fits with TPI advisors and partners.  With smaller, aggressive firms like ThinkSolutions, SourcingBoard, and others out there, the landscape is changing and it looks like that will only accelerate in the next few months.  Stay tuned……

Obama Talks Outsourcing While in India

During Obama’s recent visit to India, he spoke about outsourcing and his comments are sure to anger his political base in the U.S. and give those of us in the industry some encouragement. After recent moves that had some concerned that there may be some legislation or attempts to restrict offshoring and or outsourcing, these comments were significant:

“The perception that Indian call centers and back office operations cost U.S. jobs is an old stereotype that ignores today’s reality that two-way trade between the U.S. and India is helping create jobs and raise the standard of living in both countries,” U.S. President Barack Obama told some business executives in Mumbai on Saturday.  President Obama said that “More than 20 deals worth about $10 billion were announced on the first day of his visit.”

http://bit.ly/b7O5Ge

Tony Mataya Speaker/Panelist at Upcoming NESCON

Tony Mataya will be a speaker and panelist at the upcoming NESCON on October 4, near Boston, MA.  The topic is Nearshoring in Latin America – India & China Are So YESTERDAY! NESCON is the New England Supply Chain Conference and Exhibition and is a great place to get an update from experts on sourcing and supply chain related topics.  For a list of topics and speakers, go to: http://bit.ly/cqVkho

(Source: nescon.org)

Is KPMG buying Equaterra?

Karl Flinders reported on computerweekly.com that the consulting firm KPMG may be buying the sourcing advisory form Equaterra.  We have spent time at both large consulting firms and a sourcing advisory firm so we have some thoughts on this….

A few comments: 1) Equaterra almost merged with TPI (the largest advisory firm) several years ago but it fell through; 2) The KPMG delivery and compensation model may not be compatible with Equaterra; 3) It will be interesting to see how equity is exchanged; 4) Valuation is difficult and often the value is in the people, so retention will be critical; 5) Sometimes the advisory firm overstates the value of their methodologies; 6) Much of the revenue streams at the advisory firms tends to be project based and thus needs to be replaced each year, not ongoing revenue contracts; 7) A consulting firm brings in a lot of potential client leads which can be great for the advisory side; 8) Having an advisory practice in the fold can complicate matters if the consulting firm wants to bid on projects that the practice is advising on; 9) Normally the revenue stream from the potential sourcing work is more lucrative (although maybe not as profitable) than the advisory services.

We asked around and this story does seem to have legs, so stay tuned.  Rumors of a potential suitor for TPI have been out there for some time and with their stock in the doldrums, you may want to watch for future developments.  Here is the link for the computerweekly story:

http://bit.ly/dfVecK

tony.mataya@thinksolutions.net

(Source: computerweekly.com)