Wave Tata, Capita: You've lost mega-contract to rival outsourcer

Financial services slinger Prudential is to kick Capita to the curb, cutting short a 15-year mega deal and switching the administration of its life and pension policies to Tata Consultancy Services. The initial £722m agreement – one of Capita's largest to date – started in early 2008 when Capita took on 1,750 of Pru's people …

[getHandle]

"Capita ... said it still administers 15 million policies"

And bloody useless they are at it, by most accounts! https://www.bma.org.uk/connecting-doctors/the_practice/b/weblog/posts/capita-and-the-nhs-pension-fiasco-what-is-going-on

[Steve Davies 3]

Re: "Capita ... said it still administers 15 million policies"

And is TATA going to be any better except that it will cost the Pru 30% less than Crapita and it will all be done in the sweatshops of Mumbai or wherever in India.

In the light of the Carillion fiasco when will these companies learn that... oh never mind, the beancounters rule and to hell with the real people.

[AMBxx]

Re: "Capita ... said it still administers 15 million policies"

Regardless of what they say, this has nothing to do with service levels, just price.

Another company to add to my 'do not use' list.

[unwarranted triumphalism]

Re: "Capita ... said it still administers 15 million policies"

I bet you still pay your TV licence like a good boy.

[Anonymous Coward]

Pru CEO John Foley today talked up a shiny new "10-year partnership" with TCS to "enhance my bonus, severance package and golden parachute when I inevitably piss off elsewhere for 'to spend more time with my family'"

There - fixed it for 'em.

[John G Imrie]

s/family/money/

[Lysenko]

So essentially, they decided that if they were outsourcing most of the actual work to the subcontinent they might as well outsource the useless parasite "MBA" functions as well? I can't fault their logic.

[phuzz]

Poor spelling

This is the second story today where elReg has forgotten the 'R' in Crapita.

[Doctor Syntax]

Just checking...no, no policies with the Pru so that's OK.

[djstardust]

Hmmm

Frying pan > Fire

[Anonymous Coward]

And a few years down the line

When it goes badly they outsource to someone else.

The sub-contracting merry go round continues.

You would hope a pensions company might that, long term, having your own dedicated internal team / solution might be a good idea rather than (in the overall scheme of things) miniscule "savings":.

Bear in mind savings may not be all they seem, e.g. to save costs "my" bank closed local branches I used, result I changed bank to one with local "bricks & mortar" presence and my old bank lost a profitable customer - mortgage "switched" to new bank, so old bank lost out on lots of cash they would have received over the mortgage lifetime.

Other people similarly affected by the closures did the same.

I'm willing to bet the net "saving" of branch closure was actually a loss of money long term

[Doctor Syntax]

Re: And a few years down the line

to save costs "my" bank closed local branches I used, result I changed bank to one with local "bricks & mortar" presence

This is getting harder. I ran out of banks in my preferred location. The next best was one with in-store premises with extended opening hours. That closed. I've been pondering another change & decided on the next one but the bar stewards have decided to pre-empt me and announced the closure of the relevant branch of that bank.

I can't help hoping that when they've all completed the race to the bottom (who said "they already have?") some bright spark will have the idea of differentiating themselves by offering local branches.

[David Lawton]

Re: And a few years down the line

All i can suggest is Tesco Bank? I don't see them going anywhere, you just go to the customer services desk to do things you would use a physical branch for like paying a cheque in.

[Anonymous Coward]

I guess it's bonfire of the "CA"s ...

first Carillion,

now Capita.

What ? You think they're rock solid ? Think again.

[peterm3]

Brands built on white boxes

It seems these days our money is managed by outsourced contractors. Perhaps it is relevant to ask "who have you outsourced your back office to" when thinking of who to bank with.

I've been with Nationwide for 20 years - I think they use Capita?

Coincidentally I had an Egg savings account 20 years ago back in the very early days of internet banking. Prudential managed to take the money from my current account but forgot to transfer it to my savings account at the other end. Egg no longer exists ...

[wolfetone]

Re: Brands built on white boxes

"I've been with Nationwide for 20 years - I think they use Capita?"

In terms of their IT and branch cleaning, they use Carillion.

Well, used to.

[amanfromMars 1]

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Have a nice day, y'all.

cc ... Embassy of Ecuador

[amanfromMars 1]

Re: Create Futures .... Lead Presents with NEUKlearer HyperRadioProACTive IT

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[Anonymous Coward]

Re: Create Futures .... Lead Presents with NEUKlearer HyperRadioProACTive IT

What the fuck are you on about?

[steelpillow]

...and thanks for the fish

they didn't even bother to say to the 3,000 staff they had originally herded off onto Crapita, before cutting the raft adrift.

[Anonymous Coward]

Tata?

Fuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuck

[SVV]

Not like Carillion at all.......

I mean, it's too bad those dinner ladies and builders and prison guards didn't get paid, but it doesn't necessarily mean that the basic principle of outsourcing on the basis of "cheapest wins, always" is a bad idea, as inefficient and poorly run firms will naturally fail due to competition in the marketplace,and the government can't be expected to be propping up private HOLY SHIT, MY PENSION!!!!! WHAT HAS HAPPENED TO MY PENSION!!!! MAN FROM THE PRU MY ARSE YOU THIEVING GITS!! GET THE GOVERNMENT TO PAY IT RIGHT NOW!!!!!

[wolfetone]

Re: Not like Carillion at all.......

If there's profit to be made, it should be held in the private sector.

If there's a debt and a bail out is needed, then that should be held by the public sector.

Simpleton.

[James Anderson]

1000 jobs tranferred

Isn't that what used to happen when the plantation got sold?

Not to minimise the horror and suffering of the victims of slavery, but, TUPing, zero ours contracts, offshoring jobs to the third world, offshoring manufacturing to countries without labour, health and safety or environmental protections, how long before slavery is just another tool to enhance shareholder value?

[Lars]

Re: 1000 jobs tranferred

"how long before slavery is just another tool to enhance shareholder value?".

Just wait for Brexit. Icon just for polite I am.

[CrazyOldCatMan]

Re: 1000 jobs tranferred

how long before slavery is just another tool to enhance shareholder value

Well - the US is well on the way to bringing indentured servitude back in so, since we follow them like little lambs to the slaughter, not long..

[Terry 6]

maths

Is it my imagination, but is the whole outsourcing concept built on the mathematical idea that somehow a+b<a where a=realistic cost of providing a service and b=aggregated total of supplier costs, fees, additional administration, liaison, senior management bonuses and shareholder dividends?

Or do the outsourcering companies' beancounters somehow think themselves incapable of managing that component of their own business? Which then begs the question* as to whether they are able to manage the remaining aspects.

-----------------------------------------------------------------------------------------------------------------------------------------

*Please don't respond by defining what "begging the question" is meant to mean. That usage is gone, buried -because this usage is so much more.....useful. This is how just about everyone uses it,

[Robert Forsyth]

Re: maths

I think the (broken) idea is,

In House services costs get bloated with tea breaks, career progression training, workers' Xmas party, pension schemes, sick pay, health & safety, etc. that these execs do not care about.

Also 'Accounts' have to deal with many suppliers of things use by the In House staff. All those extra account staff to check your 20p expenses claim was filled in correctly...

Also the (broken) idea of with no competition there is no drive to efficiency - sending things 1st class instead of second or in A4 envelopes - keeping useless staff because it is more expensive to fire them.

I worked for a global co. we had locally source cleaners who were happy and caring. Then HQ makes a deal with a Crapita type which costs the same locally, but may be cheaper in central London. We get the same actual people doing the cleaning, but now they are miserable and uncaring because their (hours and hence) pay has been cut.

[Terry 6]

Re: maths

Well yes. We used to employ a cleaner and periodically pay a local windows cleaner. But then it got outsourced via a central corporate contract. Soon we couldn't see out of the windows, lots of surfaces were never cleaned properly because the miserable, underpaid staff didn't have time for more than a quick swipe with a cloth and all sorts of cleaning jobs that the cleaner used to do for a bit of paid overtime- like periodically deep cleaning special child-safe surfaces- had to be negotiated and paid for as an expensive extra ("our" beancounters don't want to know about that stuff).

[Cloud, what..... Sorry... Um... - you just made that up.]

Re: maths

Its easy. A is always less as the service level is less. So when you outsource its always cheaper but you are getting a worse service.

[Mage]

Idiots

If your business is about managing information (which Pensions, Insurance, Banking, Morgages etc is), then you have nothing to outsource. Except maybe the high street branches. You COULD outsource those to petrol stations, post-offices, convenience stores. Except the beancounters have no vision, the business perishes because the managing the information IS the core business and expertise.

Anyone doing it cheaper is lying about the quality and/or exploiting / underpaying their workers.

Same about Cloud. Put your online retail on it (elastic, good internet speed etc) but do the databases and backoffice on your OWN iron with own experts and own backup. See book "No Silver Lining" by Ray McCarthy.

Things are going to get worse. I spoke to an IT manager in Capita. "Oh we just do management, we don't have to know anything about actual IT. Never heard of Linux or MySQL or Wordpress or LibreOffice."

It's all going to crash and burn!

[PAULPRY]

Delighted to see such an awful company getting another kicking. Lowest share price since 2005 as at today, CEO gone, out of the footsie, profit warnings etc. They need to clear out the senior team - been there too long and not impressing with their performance. Why is the govt still giving them contracts?

[bonerp]

Another offshoring exercise to line the fat cats pockets

Another firm I won't deal with. UK Firms offering to india only creates wealth for those firms and the fat cats at Pru. All the UK staff losing jobs is appalling and these firms should be avoided to send a message.