About ninety minutes in, we decided to take a bio break, refill on caffeine and nosh on any remaining donuts.  Turning toward the coffee station, I spotted an older man walking aimlessly up and down the miles of cubicles.  Suddenly he stopped, picked up one of our crullers and started munching away.  ”Hey!”, I yelled, rushing toward him.  ”Those are ours!”, I cried, “And what the hell are you doing in the building?”  My voice shrilled as I all but snatched the remaining crumbs from his wrinkled paw.

“I’m so sorry young man, I had no idea.”, said the man, turning his eyes upward.  He wiped his hands on his pants and extended a handshake.  ”My name is Dave Packard.  I hope I didn’t disturb your meeting.  Nothing like a strange old man to throw off your concentration, is there?”  He grinned wryly and had a little chuckle at my expense. 

As I nervously smiled and slowly backed away from the “P” of HP, I realized what a moron I had been.  His picture was on the wall.  His initials were everywhere.  Holy crap…I had just verbally abused the Chairman of HP in his own building.  What else to do but dig in a little deeper and hope he’s a good sport, right?

“Don’t let it happen again!” escaped my lips as I wagged an accusatory finger.  ”I’ll be keeping an eye out for you.  And try not to hire any brash young idiots, okay?”  I fake-scowled, smiled and he had a good laugh, waved and moved on.  Whew…that was ugly.

My point in sharing that story is that I have embarrassed myself in literally hundreds of ways over the years (just ask my wife).  But guess what?  So has everybody else.  In my experience, one of the keys to success is to truly and sincerely admit that you are human, you make mistakes and can recognize your own shortcomings.  Self-deprecation is one of the things I enjoy most.  It’s much nicer than making fun of others and typically serves as a good way to draw people into a conversation.  

But what about when self-deprecation is false?   This is the feeling some had (myself included) from this weekend’s Saturday Night Live appearance by Sarah Palin.  There is a fine line between allowing people to mock you in your presence and actually mocking yourself.  Palin did the former and should have done the latter.

Self-deprecation is not new to the campaign trail.  To that end I’ll leave you with a story from “Mirth of a Nation” by humorist Mark Katz.  Let’s keep the conversation going and I’ll look forward to seeing some of you in Las Vegas tomorrow.

In 1958, then-Senator Kennedy was already leading the pack for the Democratic presidential nomination, but many in Washington still dismissed him as the brash son of a wealthy and unscrupulous man, a father too eager to bankroll his son’s upcoming bid for the White House. Speaking at the Capitol Hilton before an audience of such skeptics, Kennedy held up what he said was a telegram from his “generous daddy” and read it aloud: “Jack, Don’t spend one dime more than is necessary. I’ll be damned if I am going to pay for a landslide.”

Input Variable A) HP

HP has been an uncharacteristic dabbler in and around HRO for many years.  They had been rumored to be entering the market via asset acquisitions ranging from ACS, Convergys, and Hewitt for some time now, but I must say that few (myself included) would have imagined EDS as the target.  Within HR service delivery, HP does have a few arrows in it’s quiver:

1. Announces Nestle as it’s only public HRO Engagement (2006) – Scope includes European payroll with options for benefits administration, including call center administration and some back office operations.  Serves as an extension to the existing finance and accounting outsourcing agreement with Nestle.
2. HP and SAP Alliance – 50% of SAP applications globally run on HP platforms, and HP is one of SAP’s largest clients.  HP also offers SAP consulting and integration services including operations, implementation, upgrades, support and end-to-end outsourcing.
3. HP and Oracle Alliance – More than 100,000 joint customers across every line of business globally, including JDEdwards, PeopleSoft and Oracle HR applications. 
4. HP’s HR Department – Supports 156,000 employees in 170 countries.  In a recent presentation for the Conference Board, HR EVP Marcela Perez de Alonso speaks her efforts to rationalize global HR into functional Centers of Expertise such as total rewards and learning.

Input Variable B) EDS

EDS’ creation of the ExcellerateHRO joint venture in 2005 allowed the firm to move directly into the race for tier one HRO transactions.  However, many have questioned the structure and strategy of the JV and whether it is sustainable in light of formidable competition and increased price pressures.  Here’s how EDS adds up:

1. Current ExcellerateHRO Portfolio – According to published data, 400 clients across nearly all geographies (except APAC) servicing more than 33 million active and retired employees.  Notable clients include CIBC, Total (UK), Bank of America and 7-Eleven Stores.  No new client wins announced since April of 2007.
2. Towers Perrin Joint Venture – Powers the full HR transformation and consulting side of the Excellerate relationship.  Provides global reach in 24 countries and outsourced IT to EDS as part of the initial venture structure.
3. EDS and SAP Alliance – 220 implementations with more than 850,000 users in nine languages and 54 countries.  Over 2,000 certified professionals on staff.  Their internal implementation of SAP is one of the largest in the world. 
4. EDS and Oracle Alliance – Emphasis on applications management, outsourcing, modernization and development services under the brand of the Agility Alliance.  Applications are primarily focused on CRM and HR BPO with 500 professionals on Oracle and 270 on PeopleSoft.

Does A + B = HRO Domination?

In my opinion, it does not.  There is no question that the combined entity will be formidable as a global provider of BPO and ITO solutions, and no one can argue with the depth and breadth of their technological acumen and ability to configure, manage and deploy SAP and Oracle solutions in any location in the world.  However, the one hole that remains is that neither entity brings forth deep and meaningful HR domain and consulting expertise.  Thus, I feel that continued codependency on Towers Perrin will be required to present a credible HR transformation story to the market.  This puts HP/EDS/Towers Perrin next to the likes of Convergys/Deloitte in the HRO landscape.  Competitors such as Accenture, IBM and even ACS (with it’s Buck and Mellon assets) will maintain some advantage with wholly owned and internalized HR consulting capabilities.

This could be resolved with one additional tactical acquisition.  With BearingPoint trading at $1.61/share and lowering its 2008 outlook, I’d see them as one possible candidate for such a takeover.  Suffice it to say that the next 12 months in the market should be quite interesting.

Let’s keep the conversation going.