It's all about service delivery...

Services companies and those involved in outsourcing and offshoring are behind some of this year's key Agenda Setters, as Andy McCue finds out...

Outsourcing and IT services was conspicuous by its absence from last year's Agenda Setters poll. Save for Sam Palmisano at IBM and, to a lesser extent, Carly Fiorina at the helm of the then newly-merged Hewlett-Packard and Compaq, Serge Kampf (30), chairman of Cap Gemini Ernst & Young, was the only representative from the services field in the top 50.

But it's still hard times out there for most CIOs and IT directors and as the bite on IT budgets continues outsourcing, and it's associated cost-savings, has emerged as one of the few bright spots in the technology sector. Ironically, Kampf has crashed out of the chart completely this year, perhaps reflecting the difficult year CGEY has had but there are a number of significant brand new entries from the services field picked by our expert panel.

The rise and rise of low-cost offshore IT services, dominated by India, sees Indian Prime Minister Atal Bihari Vajpayee (8) break straight into the top 10. Vajpayee, with generous tax concessions and a vast pool of highly-skilled IT workers, has helped guide the subcontinent from a niche position as a location for cheap offshore application development, to the first choice low-cost offshore location for a wide range of IT services, including the burgeoning business process outsourcing market. With increasing competition from places like South Africa and China and continued pressure on price, the next year is likely to be vital for India.

Richard Allan, IT spokesman for the Liberal Democrats and panellist, said that while the price of Indian IT services is key, cost is not necessarily the determining factor, a fact backed up by Richard Sykes, chairman of sourcing consultancy Morgan Chambers, who vouched for the "strong emphasis on quality" in India.

Indian offshore services is just one way the IT services market is changing and there is a widespread acceptance that the so-called 'mega-deal' - so long the preserve and staple revenue generator of the big players such as IBM, led by Sam Palmisano (7), and EDS - is on its last legs.

Sykes said: "IBM and EDS - those megas are doomed to death. EDS' deal-based model is just too unworkable and will fall apart in two or three years. IBM will come later. No-one can cover all the waterfront. I'm convinced that over the next five years [the big players are dead meat] and EDS is the first example of that."

The panel generally praised HP's Carly Fiorina (10) for her work seeing through the HP and Compaq merger but expressed concern at her ability to build HP's services business up into a serious force that could take on the likes of IBM Global Services.

Sykes said: "History is going to say that she's got the strategic position wrong. She's in a very difficult position versus Dell, and services versus IBM."

But Certus' David Taylor warned that Fiorina may yet still surprise us all. "Let's not underestimate her. She has incredible leadership qualities and only time will tell," he said.

Another surprise new entry straight into the top 10 is Peter Gershon (9), the chief executive of the government's purchasing watchdog the Office of Government Commerce (OGC), charged with addressing the government's diabolical track record of high-profile and costly IT failures.

Because of Gershon's strategic position at the gateway of government buying decisions and his ability to implement strict controls on projects from tender through to delivery, the panel felt him to be the person who wields the most power in the public sector. In fact there is already talk his role could be merged into a new government CIO position.

Allan said: "This is probably where all the real power lies, because all the NAO reports are saying get your purchasing sorted out and that will effectively transfer power into the OGC. The power on the government side is definitely the OGC."

Gershon has put a rocket up both the suppliers and the government departments when it comes to big IT projects and his legacy will be long-lasting, said panellist Sykes.

"When the history books are written we're going to find he's had more substantial impact on how things are done and in actually getting the vendor community to perform as it promises it will. He has set in place a very determined revolution to how the government approaches managing projects. Very powerful, very effective and [though without] much publicity, highly respected," he said.

With major government outsourcing projects due to be awarded over the next year, including the £4bn Inland Revenue Aspire contract and the £4bn MoD Defence Information Infrastructure contract, Gershon is likely to have his work cut out.

One UK company that has benefited from a raft of high-profile public sector contracts is Capita, and its chairman and CEO, Rod Aldridge (26), was another high-placed new entry in this year's poll.

Despite criticism over its performance with the Criminal Records Bureau, Capita continues to win major government contracts and this year has seen it implement and run the controversial London Congestion Charge scheme. Again it has come under fire for its performance and rising costs but with a host of other UK and world cities sat in the wings waiting to introduce similar schemes, Aldridge is poised to take advantage.

Capita's success is down to the fact that its focus is service and not technology, according to Sykes.

"The key thing is it is not a technology company but a blue collar-white collar people process service delivery organisation that knows where to go to get the technology. Capita redefined the type of company that goes into outsourcing," he said.

The prominence of services in this year's Agenda Setters is a reflection of the tough times we live in, and the choices of our panel highlight the fact that success is still all about delivery and not just the technology.