Caspari needs to come clean

The first task on new EDS Australia and New Zealand vice president David Caspari's plate should be to come clean on exactly what the local consequences of HP's acquisition of the Texan IT outsourcing giant will be.
Written by Renai LeMay, Contributor on

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Renai LeMay

commentary The first task on new EDS Australia and New Zealand vice president David Caspari's plate should be to come clean on exactly what the local consequences of HP's acquisition of the Texan IT outsourcing giant will be.

The pair have provided Australian staff, customers and the general public with virtually no information about what their marriage might look like locally since the nuptials were announced in May this year, despite the fact that virtually the entire IT industry can't stop talking about the deal.

The most obvious and unanswered question is, of course, who will steer the pair's operations in the region?

On paper, and as their spokespeople have repeatedly been at pains to tell me, HP and EDS are operating as separate companies and are responsible for their own destinies. Caspari reports to Michael Coomer, the former Westpac Bank IT chief who jumped the fence late in 2007 to lead EDS's financial services business.

Coomer, now EDS's senior vice president of the Asia-Pacific and Japan region, reports directly to EDS's global chief executive Ron Rittenmeyer. On the HP side, nothing's changed; the company's Australian office is still run by Paul Brandling, vice president of HP's south pacific region.

There's just one problem with this set-up ... customers such as the Australian Taxation Office say the pair have already started working together. So the big question is: what degree of separation really exists?

Will Caspari and Brandling casually meet each other for coffee like passing ships in the night, to disinterestedly discuss the details of each others' separate businesses?

Clearly not.

The appointment of Caspari, one of HP's high-fliers, is a clear signal that the integration of HP and EDS in Australia is about to kick off for real ... probably just after he starts work on 1 November.

We're not just talking about the 75 local redundancies that EDS grudgingly admitted had occurred last week as part of the 24,600 planned globally.

Caspari, and Brandling, need to outline to clients what the integration of HP's Technology Solutions Group (from which Caspari hails) will mean on the ground; how many staff will shift to the EDS side of the fence, and will any EDS staff head the other way?


David Caspari
(Credit: EDS)

These sorts of shifts not only have massive implications for staff (and unions like the Association of Professional Engineers, Scientists and Managers Australia, which represents EDS staff), they also have profound implications for customers.

Then there's the question of hardware and software independence. EDS has previously supported technology from a range of vendors ... for example, will its new close HP ties compromise its ability to support kit from IBM, HP's biggest rival?

On the flip side of the fence, outsourcers like CSC, which partner with HP, must be wondering if their relationships with the hardware giant will shortly change dramatically due to HP having its own in-house IT outsourcer.

The potentials for conflict of interest are not unlike those involved in Telstra selling wholesale services to telcos on one hand, while its retail arm is fighting them tooth and claw. And we all know how well that scenario has panned out.

These are just some of the issues associated with the deal, which the local IT industry needs to get its head around.

Of course, even if the HP acquisition hadn't happened, Caspari's job wouldn't be an easy one; EDS is facing heightened competition from smaller IT outsourcers in a multi-sourcing climate where CIOs are no longer interested in signing billion-dollar deals, the likes of which were common in the late 1990s. And, of course, the global economic crisis makes things that much harder.

My advice to the executive would be that he and his HP compatriots need to make a clear and consistent message to Australian customers, staff and everyone else (the press included) about what to expect.

If they don't, the two companies will lose credibility at a time when they need it most.

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