Accenture: Environment Primed For IT Comeback

"There is an environment now that is more conducive to the comeback," said Joe Forehand, chairman and CEO of Accenture, at a strategy briefing Tuesday in New York.

For the 2004 fiscal year ending Aug. 31, 2004, the services company expects new bookings of $16 billion to $18 billion, said Accenture CFO Harry You. For each of the 2002 and 2003 fiscal years, the company recorded approximately $16 billion in new bookings.

For its fiscal year 2003, the services company recorded revenue of approximately $11.8 billion.

Forehand said one factor driving companies and agencies in the public sector to renew spending on information technology is the need to better manage existing applications and infrastructure investments. As an example, the emerging field of RFID will play a major role among businesses looking to improve their supply chains, he said. Among other things, executives must use IT to act more quickly and differentiate their companies during the recovery.

id
unit-1659132512259
type
Sponsored post

"I've yet to find an executive that will tell me that he or she has all the right information at all the right times to run their business," Forehand said.

Accenture executives believe companies' continuing need to rationalize costs while bringing more insight and discipline into the decision-making process will help drive its burgeoning business-process outsourcing practices. Accenture's consulting revenue was off 10 percent in fiscal year 2003, but revenue related to overall IT outsourcing activities rose approximately 37 percent, according to Accenture's latest financial report.

Accenture has developed eight different services that bring a standardized approach to deployment and maintenance of certain operational functions and to help it gain traction in the midmarket. They span the gamut from Accenture Finance Services, an offering for handling accounting, billing and other related functions, to Accenture Connection to eBay, a service for managing excess inventory that the services firm developed in conjunction with the online auction community.

Another major bright spot for Accenture is its government business, which experienced growth of about 20 percent in fiscal year 2003.

Stephen Rohleder, group chief executive, government, at Accenture, said 31 of the 50 states are running at a deficit and are seeking ways to create new revenue sources through IT infrastructure. Like some of its rivals in the government sector, Accenture is structuring its government contracts differently than in years past, basing how it is paid for services on whether its firm is able to create certain measurable "outcomes" for its clients.

Factors affecting the spike in Accenture's government business included the previously mentioned revenue crisis, shifting perceptions of the services that agencies should offer to their constituents and the fact that close to 50 percent of the government workforce will be eligible for retirement within the next three to four years, Rohleder said.