Microsoft Outsources Its Back Office, Boosts Dividend

[OhioChick]

Source: Information Week

The software maker has been quietly outsourcing its back office operations to service provider Accenture over the past several months, Accenture disclosed Thursday.

September 13, 2007 10:32 AM


Microsoft (MSFT) is doing some internal house cleaning.
The software maker has been quietly outsourcing its back office operations to service provider Accenture over the past several months, Accenture disclosed Thursday.

The two companies struck a seven-year deal earlier this year, Accenture said. Under the pact, worth $185 million, Accenture will handle a range of finance and accounting functions for Microsoft, including accounts payable and travel and expense management and general ledger maintenance.

Accenture also is providing Microsoft with a number of procurement services, including requisition-to-purchase order processing.

Microsoft chief accounting officer Frank Brod said in a statement that the companies are "a few months into the program." Brod said he is "pleased with the progress and speed of the transition."

Accenture did not specifically disclose the location from which it's providing the services, but the company has been aggressively building up its footprint in India in order to tap the country's army of low-cost, white-collar workers. Accenture will have more employees in India than in the U.S. by year's end, company officials have stated.



Read more: http://www.informationweek.com/news/showArticle.jhtml?articleID=201806124

[Deja Q]

1. Fewer Indians starve, more Americans starve.

Bigger Indian middle class. Smaller American middle class.

Code quality drops more. Who's going to want to fix it at that point?

Bill Gates can say "The dollar is going to go down!" all he wants. His actions seem to help contribute to its decline.

:shrug:

[aquart]

2. A corporation that declares a profit that debits the nation is a parasite.

A parasite will kill its host if not rigidly controlled. All the income from those jobs is now debit. Not spent here. Not enriching this nation's people. We are expected to buy the products, but they provide no benefit to us in terms of jobs.

An economic model that does not include jobs is one that actively works against the prosperity of a nation.

[Deja Q]

3. Philanthropic, actually.

On the flip side, Bill Gates is helping Indian and Chinese economies (Indian right now, but he's trying to make lucrative deals in China too). As nobody in those countries is screaming "WE'RE BEING EXPLOITED!!!!!!!!", it's quite clear they are in an equitable situation.

Pity the quality's crap, but nobody's perfect...

If the US cost of living matched India's, I'd suspect there'd be a lot less offshoring.

Still, in some ways, globalization isn't all that bad. Right now, the world appears to be everybody except America.

I'm just glad programming isn't my forte... or fortran...

[wug37]

4. Hey, come on now

I work for Accenture in the Wilmington De. office doing application development work. I'm not on this Microsoft project, but I did know that they were a client of ours.

I may not much like working here, and in fact am looking to move on, but they're certainly not a parasite. Accenture has thousands of employees in the US. They have thousands of employees in many other countries too, including Spain, England, Hungary and so on.

The fact is, every large corporation has employees worldwide. If a company does international business, they'll need an international workforce. Just because a company isn't based entirely in one country doesn't make them a parasite.

Look at it this way - the profits still come back here. And that's after the investments made in other parts of the world.

Edited to add that the 7yr 185 million dollar contract is a rather small contract. I'm currently on a 10yr billion dollar project by comparison.

[Double T]

6. Accenture's 'product' is outsourcing American jobs to foreign nations...........

which is and will continue to be the dismantling and destruction of America. Accenture is epitome of a corporate traitor. Both YOU and Tiger Woods should find NEW pro-American employers.

[wug37]

10. Accenture's 'product' is to provide a technical service

to those companies that hire them. Other companies outsource work to Accenture. That's what makes Accenture an outsourcing company. Not the fact that some work is done overseas.

They are certainly not trying to dismantle or destroy America. They are just running a business that fills the needs of other companies.

I will admit however, that Accenture did first develop the global work model where work is spread out over the entire world, in effect having people on 24 hours a day during local normal working hours. This model has been adopted by many other companies, and will probably continue to be a dominant force in the world economy.

Additionally, I hate tiger woods and wish he wasn't shilling for Accenture. Go on, be a tiger is the most ridiculous corporate slogan ever.

[Double T]

13. corporate ANTI-america is ALWAYS attempting to declare........

that THEY are NOT dismantling and destroying America; the trade deficit is one gage that definitively refutes their absurd claims. When 50% of the entire world's manufacturing is done in china and every time you pick up a phone to call customer service for EVERY product or service and are talking to india, INC., one can easily identify there is a serious problem. Accenture is the reformulated child of the diseased criminal arthur anderson company and we know the rotten apple does not fall far from the infested tree. I wish YOU better employment with a respectable company in the future; DON'T BE A TIGER!

[wug37]

18. Destroy America? Then there goes their income and profit!

Thank you for your wish of better employment. I am working toward being employed with a different company by the end of the year. But not because Accenture isn't a respectable company. I just don't feel that they can fill my long term goals.

However, you too (you and someone else on this topic) are pitching guilt by association which itself is quite anti-American. Just because Accenture was spun off from Arthur Anderson does not mean that they run their business using those same corrupt practices. In fact, Accenture believes they are held to a higher standard because of Arthur Anderson and do their best to run their business as ethically as possible. There have been several high level (and low level) people fired for breaking those ethics. It is something Accenture takes very seriously.

The reason that so much work is going offshore to India and China is because the workforce is so much cheaper there because they are emerging markets, whereas we are already established. Currently in India, the standard of living is going up, and therefore the wages are going up. It's getting more expensive to do business there, so within probably 10 years, they will be affected by the same loss of jobs that we are as companies look to move their workforce elsewhere in search of lower costs. This is how business works in this modern economy. It's not Accenture's fault, nor is it any other businesses fault. It's just how it works. Eventually things will change in the future, but what that change is, I don't know.

[melm00se]

14. point of fact

per hoovers, Accenture employs approximately 140K people. Approximately 30K are here in the US, 35K in India.

[Deja Q]

7. That was a good response.

But how come American jobs have to be lost in "globalization", if the goal of economics is expansion (which means more peoples' involvement, period)?

[wug37]

11. That is a question I cannot answer

You'll need to refer to an economics person for that answer. I'm just a computer programmer trying to defend my employer from being called a parasite or a blight on America.

[LanternWaste]

9. Are there any large American corporations that don't do that?

Are there any large American corporations that don't do that?

:shrug:

[onehandle]

5. Accenture is a terrible company that is an enemy of the American Worker.

They have HUGE outsourcing centers in India and other parts of Asia. And are building even more.

Their CEO publicly stated that, "Our main business is outsourcing", a few years back.

Lou Dobb's refers to them as a "foreign company" because they moved their "headquarters" to a Carribean island specifically to dodge taxes.

They have done a lot of business with such fine firms as Halliburton, Enron, and many other Bush supporting entities.

They are a spinoff of Arthur Andersen (Enron's accountants) and that should tell you Plenty about them right there!

[wug37]

8. A few explanations and corrections

The main business of Accenture is outsourcing, as that means that other companies hire Accenture to perform various tasks and services. For example, AT&T outsourced some tech/system development work to Accenture because Accenture is an outsourcing company. That is what they do. They do work that other companies don't want to do in house.

Accenture has a long list of clients that include companies such as DuPont, Verizon, the US Defense Department, Dell, Nissan, Lyondell and so on. They're not a political company by any stretch of the imagination.

Accenture is a spinoff of Arthur Anderson, but was it's own legal entity several years prior to the Enron scandal. Accenture had nothing to do with that at all and was not connected to Enron at all at the time.

[onehandle]

15. Explanations and corrections?

I think you mean Excuses and Camouflage.

Doing the hands-on dirty work of corporate America is no excuse.

Accenture may not have had current contracts with Enron at the time of the break of the scandal (likely because Enron didn't have the funds to pay them), but they did do business with then and a laundry list of other Bush/Cheney clients. Time does not Camouflage association.

Nice try.

[wug37]

17. You're pitching guilt by association

and then expect me to take you seriously?

Since you seem so opposed to corporations, I take it you don't use any products that can be associated with one. No cars, no electronics, no public transportation, no cell phone or cell phone plans, no food, no utilities and so on. Of course, since you're obviously using a computer, you've already broken that.

What makes you so angry?

[ChairmanAgnostic]

12. anyone wanna bet that Accenture is NOT using MS software for that stuf?

they probably want to use programs that have few glitches.

[fasttense]

16. Let's out source all US jobs.

Up the HB1 visas to 100 million. Get all those starving folks into the US to do those jobs Americans wont do. Outsource what is left. There isn't a job in the US that can't be done for half the wages by someone from a more impoverished nation. You need an advance degree for doctors and engineers? Don't worry many of the world's poor have strong educational credentials.

Corporations will make hundreds of billions of dollars and create more jobs to outsource or in-source. Millionaires and billionaires will get even richer. The US middle class, well there wont be much of a middle class. But who cares? Maybe a few doctors, maybe a few mid-level bureaucrats will remain in the US middle class. But for the most part the US middle class will shrink as they sink into poverty. Then they will be glad to be getting a job at half the wages they use to make.

Let's get all the poor from all the world to work in the US. That will free up everyone to....well, US citizens wont have jobs. Maybe they can all get rich off the backs of the new temporary workers. You never know, let's get rid of all US jobs, Now.

[Double T]

19. 'aGREED!' The robber barons at the turn of the last century, the CONservatives in the 1920's and...

NOW the corrupt criminal corporate ANTI-american psychopaths and their henchmen BIG investors are out to acquire ALL the world's wealth while leaving everyone else to literally fight over the crumbs. Revolution in America and around the world is inevitable, as history will once again repeat itself.