KAZ Group has restructured its operations into two distinct arms to fully incorporate Aspect Computing and offer customers a single point of access to the full range of its services.
Managing director, Peter Kazacos, said the changes had led to “tens rather than hundreds” of redundancies since Aspect was taken over in April 2002, as KAZ seeks to reduce administration, financial and HR costs.
He also claimed the company expected to save up to $1 million a year in real estate as lease arrangements were finalised over the next 12 months.
The restructure sees Aspect and the former KAZ Computer Services division combined into a new body, KAZ Technology Services, that will offer facility management and outsourcing as well as managed infrastructure, technical, application development, consultancy and education services.
IT services accounted for 70 per cent of the group’s revenue in the second calendar half of 2002.
The new KAZ Business Services, incorporating the former Ausdata business and Business Process Outsourcing (BPO) division, will offer customer contact solutions, claims management and processing, document management, client administration and transaction services.
Australian Administration Services, that provides superannuation administration services for about 3.5 million Australians, will operate as part of KAZ Business Services with its name and focus unchanged.
BPO currently accounts for about 26 per cent of KAZ Group revenues but has been highlighted by Kazacos as the company’s biggest potential growth area.
“There’s a continued move towards selective sourcing rather than the all or nothing approach that’s been there in the past,” Kazacos said.
Citing KAZ’ recent replacement of IBM in a $15 million ING win, Kazacos said strategic acquisitions had left KAZ in a position where it no longer had to deal with external partners and had become cost aggressive in the BPO space.
He highlighted government contracts as a key growth area for KAZ but said possible contracts were thin on the ground at the moment.
“There will have to be some [government contracts] that don’t rollover to the [multinational] incumbent because the Government is under a lot of pressure in that respect at the moment,” Kazacos said.
“The selective sourcing approach will be used to let other [Australian] players get large chunks rather than the crumbs that have been left on the table. We will be prepared to engage and win these contracts.”
The remaining 4 per cent of KAZ business comes from product development and sale in conjunction with IBM. Kazacos said the company would look to exploit export opportunities for these products, particularly into the US market.
While he was bullish about growth within the BPO space, Kazacos was less confident in his predictions for the IT industry as a whole.
“In general, the IT downturn won’t pick up to any great extent until the end of the next calendar year,” he said.
“People are spending but nowhere near the levels they were in the past. We have to work out if where we are now is the new normal level.”