Brendan McDonagh, who once was HSBC Bank USA's top officer in Buffalo, has been named chief executive officer of HSBC North America Holdings Inc.
The unit is London-based HSBC Holdings PLC's banking and consumer finance businesses in the United States and Canada McDonagh, a 28-year veteran of international banking with HSBC, also becomes a group managing director of HSBC Holdings PLC and joins the Group Management Board.
In 2004-2006, while based in Buffalo, he was chief operating officer of HSBC Bank USA NA and oversaw the significant expansion of the bank¹s brand and its U.S. consumer and commercial network.
For the past year he has been chief executive of Illinois-based HSBC Finance Corp.
credited by bizjournals.com.com
2008-02-25
2008-02-23
Google Goes to the Doc's Office
The U.S. health-care system is the most costly in the world. Yet it's also remarkably antiquated. The medical records of as many as 90% of patients are hidden away in old-fashioned filing cabinets in doctors' offices. Prescriptions are scribbled on paper. Most Americans need to fill out separate medical histories for each specialist they visit. "We are trained, like Pavlov's dogs, to repeat the same information 17 times," says Scott Wallace, chief executive officer of the National Alliance for Health Information Technology, a not-for-profit alliance of health care providers, information technology vendors, and health and technology associations. The result: mistakes, duplicated tests, botched diagnoses, and billions of dollars in unnecessary costs and lost productivity.
Many providers, including Kaiser Permanente and Cleveland Clinic, have invested millions of dollars in information technology systems and creating electronic medical records for patients. Here's the rub: Much of that information can't be shared from one doctor or hospital to the next. As a result, blood-test results in the database of an Arizona doctor, for instance, are of little use when the patient is visiting a doctor halfway across the country. Linking systems "is the real challenge in this industry," says Dr. C. Martin Harris, chief information officer at the Cleveland Clinic.
Pilot Project Kicks Off
In an effort to meet that challenge, the Cleveland Clinic and Google (GOOG) on Feb. 21 announced a project to give patients and doctors better access to electronic medical records. "It is clear that one of the big needs is assembling health records from a variety of places and giving people control of those records," explains Marissa Mayer, vice-president for search products and user experience at Google. And while the Cleveland/Google project may revolutionize medical record-keeping and improve how hospitals and physicians provide care, it also raises concerns over patient privacy and the security of sensitive information.
Here's how the pilot project, officially begun on Feb. 18, works. The Cleveland Clinic already keeps electronic records for all its patients. The system has built-in smarts, so that it will alert doctors about possible drug interactions or when it's time for, say, the next mammogram. In addition, 120,000 patients have signed up for a service called eCleveland Clinic MyChart, which lets patients access their own information on a secure Web site and electronically renew prescriptions and make appointments.
The system has dramatically cut the number of routine calls to the doctor and boosted productivity, though it has yet to effectively deal with information from an outside physician, Harris says. Those records are typically still on paper, and have to be laboriously added to the Cleveland Clinic system. It is a big problem, especially for the clinic's many patients who spend winters in Florida or Arizona, where they see other doctors.
Adding Google's technology lets patients jump from their MyChart page to a Google account. Once on Google, they'll see the relevant health plans and doctors that also keep electronic medical records. That means the patient can choose to share information between, say, the Arizona doctor and the Cleveland Clinic.
The system is still fairly primitive compared with sophisticated electronic information-sharing systems such as an ATM network. The information being shared is limited to data on allergies, medications, and lab results. That's because this data is more easily put in a standard form that can be read by different computer systems.
Paring Health-Care Costs
For the health-care system as a whole, though, it's an important move forward. "What Martin [Harris] has done is revolutionary," says Wallace of the National Alliance for Health Information Technology. "It may not be the perfect solution, but it is a better solution than we have now." Over time, more information can be added, and more patients and doctors will be able to access the records. And if the pilot program works, Google intends to roll out a comparable service for the general public.
One payoff: cutting health-care costs. "There's a real potential to affect the slope of the health-care cost curve," Harris says. "I believe this kind of exchange is the way we will get the total value out of an electronic medical record."
Projects like the one started by Cleveland and Google could also have big implications for business. Companies want employees to take greater charge of their health care. Experts say employees can do a better job of that by gaining control over -- and access to -- records, and that they'll get a leg up, technology-wise, from the participation of such players as Google and Microsoft (MSFT). "I think Google is spectacular on this," Wallace says. "Health care is a mainstream issue, and getting the purveyors of information involved in this is a brilliant step."
What's In It for Google?
How the e-health program plays out for Google is less clear. Mountain View [Calif.]-based Google is not the first high-tech giant to dip a toe into health care. Microsoft, for example, launched a health records and information service, HealthVault, in October [BusinessWeek.com, 10/4/07]. The company has more than 100 partners including the Mayo Clinic, a nonprofit medical practice and large online health-information network, and hopes to use its large health software business to help bring new players on board.
On Feb. 20, the company released source code to help outside organizations and developers integrate their information and build programs around the HealthVault platform. "We think that we are the best health search out there, and we think more and more we are going to convince people of that," Sean Nolan, HealthVault's chief architect.
Being late to the game has hurt Google in the past. The company's finance site, launched May, 2006, has failed to gain much traction. It ranks 16th in the business information category of Hitwise, a company that measures Web traffic. Yahoo's (YHOO) much older finance site has remained No. 1 for much of the past three years. Similarly, Google's payment service Google Checkout [BusinessWeek.com, 7/10/06], launched in June, 2006, has failed to grab market share from eBay's (EBAY) leading payments service, PayPal .
Thorny Privacy Issues
When it comes to online health information, the obvious prize is the estimated $500 million to $1 billion health search advertising. Google won't admit to aiming for that market, though, and those familiar with the project suggest revenue could come from other sources. "They aren't wedded to advertising," Wallace says. "Their attitude is that this is such a nascent area, they can play around for a while and find a way to make huge amounts of money." It's not yet clear how that might happen. "The unanswered question is what is the business model that justifies the investment of these big players," says David Lansky, senior director of the health program at the John and Mary R. Markle Foundation, a nonprofit dedicated to improving information technology in health care.
One worry is that the companies might be tempted to sell personal information. While strict laws govern patient privacy at hospitals and health-care providers, "there is no federal regulation of what these middle-layer players can do with your data," Lansky explains. And while consumers might trust Google or Microsoft now, what might happen in years or decades? "This is deeply personal information that is being collected about you and your family," says Jeff Chester, executive director of the Center for Digital Democracy. "There is unease about marketers being able to access that vast range of information."
credited by: BusinessWeek.com
Many providers, including Kaiser Permanente and Cleveland Clinic, have invested millions of dollars in information technology systems and creating electronic medical records for patients. Here's the rub: Much of that information can't be shared from one doctor or hospital to the next. As a result, blood-test results in the database of an Arizona doctor, for instance, are of little use when the patient is visiting a doctor halfway across the country. Linking systems "is the real challenge in this industry," says Dr. C. Martin Harris, chief information officer at the Cleveland Clinic.
Pilot Project Kicks Off
In an effort to meet that challenge, the Cleveland Clinic and Google (GOOG) on Feb. 21 announced a project to give patients and doctors better access to electronic medical records. "It is clear that one of the big needs is assembling health records from a variety of places and giving people control of those records," explains Marissa Mayer, vice-president for search products and user experience at Google. And while the Cleveland/Google project may revolutionize medical record-keeping and improve how hospitals and physicians provide care, it also raises concerns over patient privacy and the security of sensitive information.
Here's how the pilot project, officially begun on Feb. 18, works. The Cleveland Clinic already keeps electronic records for all its patients. The system has built-in smarts, so that it will alert doctors about possible drug interactions or when it's time for, say, the next mammogram. In addition, 120,000 patients have signed up for a service called eCleveland Clinic MyChart, which lets patients access their own information on a secure Web site and electronically renew prescriptions and make appointments.
The system has dramatically cut the number of routine calls to the doctor and boosted productivity, though it has yet to effectively deal with information from an outside physician, Harris says. Those records are typically still on paper, and have to be laboriously added to the Cleveland Clinic system. It is a big problem, especially for the clinic's many patients who spend winters in Florida or Arizona, where they see other doctors.
Adding Google's technology lets patients jump from their MyChart page to a Google account. Once on Google, they'll see the relevant health plans and doctors that also keep electronic medical records. That means the patient can choose to share information between, say, the Arizona doctor and the Cleveland Clinic.
The system is still fairly primitive compared with sophisticated electronic information-sharing systems such as an ATM network. The information being shared is limited to data on allergies, medications, and lab results. That's because this data is more easily put in a standard form that can be read by different computer systems.
Paring Health-Care Costs
For the health-care system as a whole, though, it's an important move forward. "What Martin [Harris] has done is revolutionary," says Wallace of the National Alliance for Health Information Technology. "It may not be the perfect solution, but it is a better solution than we have now." Over time, more information can be added, and more patients and doctors will be able to access the records. And if the pilot program works, Google intends to roll out a comparable service for the general public.
One payoff: cutting health-care costs. "There's a real potential to affect the slope of the health-care cost curve," Harris says. "I believe this kind of exchange is the way we will get the total value out of an electronic medical record."
Projects like the one started by Cleveland and Google could also have big implications for business. Companies want employees to take greater charge of their health care. Experts say employees can do a better job of that by gaining control over -- and access to -- records, and that they'll get a leg up, technology-wise, from the participation of such players as Google and Microsoft (MSFT). "I think Google is spectacular on this," Wallace says. "Health care is a mainstream issue, and getting the purveyors of information involved in this is a brilliant step."
What's In It for Google?
How the e-health program plays out for Google is less clear. Mountain View [Calif.]-based Google is not the first high-tech giant to dip a toe into health care. Microsoft, for example, launched a health records and information service, HealthVault, in October [BusinessWeek.com, 10/4/07]. The company has more than 100 partners including the Mayo Clinic, a nonprofit medical practice and large online health-information network, and hopes to use its large health software business to help bring new players on board.
On Feb. 20, the company released source code to help outside organizations and developers integrate their information and build programs around the HealthVault platform. "We think that we are the best health search out there, and we think more and more we are going to convince people of that," Sean Nolan, HealthVault's chief architect.
Being late to the game has hurt Google in the past. The company's finance site, launched May, 2006, has failed to gain much traction. It ranks 16th in the business information category of Hitwise, a company that measures Web traffic. Yahoo's (YHOO) much older finance site has remained No. 1 for much of the past three years. Similarly, Google's payment service Google Checkout [BusinessWeek.com, 7/10/06], launched in June, 2006, has failed to grab market share from eBay's (EBAY) leading payments service, PayPal .
Thorny Privacy Issues
When it comes to online health information, the obvious prize is the estimated $500 million to $1 billion health search advertising. Google won't admit to aiming for that market, though, and those familiar with the project suggest revenue could come from other sources. "They aren't wedded to advertising," Wallace says. "Their attitude is that this is such a nascent area, they can play around for a while and find a way to make huge amounts of money." It's not yet clear how that might happen. "The unanswered question is what is the business model that justifies the investment of these big players," says David Lansky, senior director of the health program at the John and Mary R. Markle Foundation, a nonprofit dedicated to improving information technology in health care.
One worry is that the companies might be tempted to sell personal information. While strict laws govern patient privacy at hospitals and health-care providers, "there is no federal regulation of what these middle-layer players can do with your data," Lansky explains. And while consumers might trust Google or Microsoft now, what might happen in years or decades? "This is deeply personal information that is being collected about you and your family," says Jeff Chester, executive director of the Center for Digital Democracy. "There is unease about marketers being able to access that vast range of information."
credited by: BusinessWeek.com
2008-02-17
Capgemini: 'Building a Global Powerhouse'
Paul Hermelin has seen both sides of the offshoring phenomenon. When he took over as chief executive of Capgemini (CAPP.PA) in 2002, Europe's largest information technology services outfit was still struggling to get past its 2000 merger with Ernst & Young Consulting while facing competition from upstart Indian firms. Now, thanks to a lot of hard work by Hermelin and his executive team, the company is benefiting from the massive shift in outsourcing to lower-cost countries -- where Capgemini's staff has more than doubled over the past four years, to 20,000 people.
On Feb. 14, Capgemini turned in a stronger-than-expected earnings report. Revenues rose 13%, to $11.9 billion, and net income nearly doubled, to $602 million. The company's operating profit margin came in at 7.4%, and Hermelin expects it to hit 8.5% this year. Because of the restructuring of a major contract with the British government, however, Capgemini is forecasting only a 2% to 5% revenue increase in 2008. After the quarterly update, Hermelin discussed the company's strategy with BusinessWeek senior writer Steve Hamm.
Capgemini had a strong 2007, both in revenue growth and operating margin improvement. How do you account for that?
We are probably the one Western company, along with Accenture (ACN), that has truly embraced a global delivery model. You can see the speed of growth of our offshore head count. It helps us to be more and more competitive. We now have people in several countries. We're mastering multishore delivery. Now, in the U.S., if there are 100 people working for an outsourcing client, probably 45 of them are based in India. That makes us a hybrid animal between the Indian pure player and the traditional Western player.
You say Capgemini and Accenture are the Western companies that have most embraced the global delivery model. What about IBM (IBM), which employs 70,000 people in India?
Nearly half of them work for IBM software and hardware departments. If you look at the number of IBM people in India who are actually servicing Western customers, as a proportion of their revenues, they are behind us. I do not see them as often with customers with global delivery as I see Accenture.
You have dramatically increased your offshore workforce, both by acquiring India's Kanbay and through hiring, giving the company 5,000 employees in India. What are the biggest challenges you have faced, and how have you overcome them?
What worked very well was to use offshore skill groups initially as sort of offshore subcontractors. I could say to my Dutch guy or French guy, "You own the customer and you're rewarded for the revenue generation, and you keep the profit." It was a good way to awaken our onshore people to the offshore model. But that's not a sustainable model, because if I do that, I contain the Indian employees in a role they don't like, and I can't retain the best talents.
We are moving now to a model where there's a seamless organization that integrates on- and offshore people in a consolidated business unit. It's a little more difficult, but it's far more rewarding. It [offers] the customer a kind of embedded interface between offshore and onshore that they don't have to build. We won back some contracts from the pure players, be they Tata or Infosys (INFY). We can do this because of the multicultural nature of our organization. They are global players, but they're Bangalore-centric. There are other global players, like IBM, but they're Armonk [N.Y.]-centric.
We are the only global player that's truly multicultural and distributed. That's because the last time Paris was the center of the world was when Louis XIV reigned, 300 or 400 years ago. We can't do that now. So our only chance for building a global powerhouse is to combine many cultures and have a global company based on entrepreneurship and multiculturalism.
Do you expect this rapid growth in offshore workers to continue?
The plan is to go from 20,000 to 45,000 in two years.
Is there any truth to the reports that India's Reliance Communications is seeking to buy Capgemini?
There's a journalist in India, from the Economic Times, who loves this kind of story. It's the third time he has written about us talking with an Indian company. I don't know why he has a Capgemini obsession. The thing is, Reliance closed a major alliance with Accenture. So if there's one Indian company that would never even talk to us, it's Reliance. The guy is not aware.
You have been working hard to get your outsourcing contract with Schneider Electric (SCHN.PA) on the right track. Where did that deal go wrong, and what are you doing to fix it?
It was a long process of renegotiation that was closed on [Feb. 8]. The initial contract was flawed. They had one obsession, which was building a globally integrated system, based on nearly every module of SAP's (SAP) software, to create the backbone of their company. That we knew. But it's a company with many baronies, and when we tried to build the system in order to overcome the resistance of some of their baronies, we had to design something significantly more complex than we had at first planned. To get buy-in of the different business lines, we agreed on something more complex and comprehensive, and we thus delayed the savings that we both hoped to achieve. The whole contract became unbalanced.
We now have a new contract. The system is nearly ready. We have delivered the first pilot in India. We'll deliver the second pilot in Europe about midyear. We're rolling out the solution, and the contract is more flexible to acknowledge some adaptation. We took some adjustments on price points, but if there are adjustments on volumes, it will be their responsibility. If they have more PDAs and BlackBerrys, for example, we'll track the volume of hardware and applications, and make adjustments. Both parties are happy.
Why have business consulting services been relatively weak for Capgemini? Your revenues there only rose 4.5% last year. What are you doing about that?
In Europe, we had a nice ramp-up; it was 9% in the second half. In the U.S., we're lagging behind. We created a dedicated consulting entity in the U.S., which can be attractive for talent, and we may buy a company. It's a big differentiation against the Indians, because they don't have any consulting. In Europe, we're No. 1. We're big in France, Germany, and growing in the U.K. So I'm quite pleased. But in the U.S., we can't be at the level we need without an acquisition.
What new business initiatives will Capgemini launch in 2008?
It's still back on the onshore transformation. We don't want to make the Indians into a back office. We have to get our front-end people to understand that with a truly global delivery system they can gain market share. We have a program we're working on. This is the most demanding thing we're working on.
The other part is to monitor a quite unstable economic environment. If there is a downturn, the first thing people cut is consulting. The second is IT programs. We're exposed to a downturn. We're highly cyclical. We're in the people business, so we have to monitor this very carefully. In a recession, companies will try to get savings from handing over operations to a big outsourcer. They'll keep some projects that target cost savings. But they'll stop all projects that are related to their customers. Today there are a lot of customer management and marketing support projects. That will probably be frozen or sliced or delayed in a recession. In the last recession, people kept investing in their systems -- upgrading applications. But they delayed things like new supply-chain engineering. That can be delayed a few quarters without harming the business.
credited by: BusinessWeek.com
2008-02-15
Florida, other states settle with Caremark
Florida will receive at least $1.7 million from a settlement with Caremark Rx involving 28 other states and the District of Colombia, state Attorney General Bill McCollum's office says.
Caremark Rx, a subsidiary of CVS Caremark, will pay $41 million to the states as part of a settlement. Of the $41 million, $2.5 million will be paid in direct reimbursements to consumers and $22 million -- including the $1.7 million -- will be paid into a fund to be used in various pre-determined ways to benefit prescription medication patients. The attorney general's office says the state is still determining how consumer reimbursements will be distributed. Of the $41 million, $16.5 million will be used to reimburse states for legal costs.
Benefits management companies such as Caremark process claims for prescription drugs.
The attorney general's office said Caremark engaged in deceptive business practices by encouraging doctors to switch patients to brand-name drugs and misleading the doctors about what that would entail. Specifically, Caremark did not tell doctors that it would be pocketing the savings from such switches instead of passing them on to a patient's health plan.
As part of the settlement, CVS Caremark denied the charges.
credited by: bizjournals.com
Caremark Rx, a subsidiary of CVS Caremark, will pay $41 million to the states as part of a settlement. Of the $41 million, $2.5 million will be paid in direct reimbursements to consumers and $22 million -- including the $1.7 million -- will be paid into a fund to be used in various pre-determined ways to benefit prescription medication patients. The attorney general's office says the state is still determining how consumer reimbursements will be distributed. Of the $41 million, $16.5 million will be used to reimburse states for legal costs.
Benefits management companies such as Caremark process claims for prescription drugs.
The attorney general's office said Caremark engaged in deceptive business practices by encouraging doctors to switch patients to brand-name drugs and misleading the doctors about what that would entail. Specifically, Caremark did not tell doctors that it would be pocketing the savings from such switches instead of passing them on to a patient's health plan.
As part of the settlement, CVS Caremark denied the charges.
credited by: bizjournals.com
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