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Accenture plc (NYSE: ACN, ISIN: BMG1150G1116) is a global management consulting, technology consulting and technology outsourcing company. It was previously incorporated in Bermuda but since 1 September 2009 has been incorporated in Ireland.[2] It is said to be the largest consulting firm in the world.[3] Accenture is a Fortune Global 500 company[4] with more than 186,000 people in 52 countries. For the fiscal year ended 31 August 2008, the company generated net revenues of US$23.39 billion. Accenture's clients include 96 of the Fortune Global 100 and more than three quarters of the Fortune Global 500.[5]
[edit] History[edit] Formation and early yearsAccenture originated as the business and technology consulting division of accounting firm Arthur Andersen. The division's origins are in a 1953 feasibility study for General Electric. GE asked Arthur Andersen to automate payroll processing and manufacturing at GE's Appliance Park facility near Louisville, Kentucky. Arthur Andersen recommended installation of a UNIVAC I computer and printer, which resulted in the first commercially owned computer installation in the United States in 1954. Joe Glickauf was Arthur Andersen's project leader responsible for the payroll processing automation project. Now considered to be the father of computer consulting, Glickauf headed Arthur Andersen's Administrative Services division for 12 years. [edit] Splitting from Arthur AndersenIn 1989, that division split from Arthur Andersen and began using the name Andersen Consulting. Both Arthur Andersen and Andersen Consulting consisted of groups of locally-owned independent partnerships and other entities around the world, each in a contractual agreement with Andersen Worldwide Société Coopérative (AWSC), a Swiss administrative entity. By 2000, Andersen Consulting had achieved net revenues exceeding US$9.5 billion and had more than 75,000 employees in 47 countries,[6] whereas Arthur Andersen had revenues of US$9.3 billion with over 85,000 employees worldwide in 2001. Through the 1990s there was increasing tension between Andersen Consulting and Arthur Andersen. Andersen Consulting was upset that it was paying Arthur Andersen up to 15% of its profits each year (a condition of the 1989 split was that the more profitable unit - AA or AC - paid the other this sum), while at the same time Arthur Andersen was competing with Andersen Consulting through its own newly established business consulting service line called Arthur Andersen Business Consulting. This dispute came to a head in 1998 when Andersen Consulting claimed breach of contract against AWSC and Arthur Andersen. Andersen Consulting put the 15% transfer payment for that year and future years into escrow and issued a claim for breach of contract. In August 2000, as a result of a conclusion of the International Chamber of Commerce, Andersen Consulting broke all contractual ties with AWSC and Arthur Andersen. As part of the arbitration settlement, Andersen Consulting paid over the sum held in escrow (then $1.2 billion) to Arthur Andersen, and was required to change its name, resulting in the entity being renamed Accenture. Perhaps most telling about who had "won" the decision was that four hours after the arbitrator made his ruling, Arthur Andersen CEO Jim Wadia suddenly resigned. Industry analysts and business school professors alike viewed the event as a complete victory for Andersen Consulting.[7] Jim Wadia would provide insight on his resignation years later at a Harvard Business school case activity about the split. It turned out that the Arthur Andersen board passed a resolution saying he had to resign if he didn't get at least an incremental $4 billion (either through negotiation or via the arbitrator decision) for the consulting practice to split off; hence his quick resignation once the decision was announced. Accounts vary on why the split occurred — executives on both sides of the split cite greed and arrogance on the part of the other side, and executives on the Andersen Consulting side maintained breach of contract when Arthur Andersen created a second consulting group, AABC (Arthur Andersen Business Consulting) which began to compete directly with Andersen Consulting in the marketplace. Many of the AABC firms were bought out by other consulting companies in 2002, most notably, Hitachi Consulting and KPMG Consulting, which later changed its name to BearingPoint. Andersen Consulting's change of name proved to be fortunate as it avoided the taint when Arthur Andersen was effectively dissolved as a result of its role in the Enron scandal. [edit] Emergence of AccentureOn January 1, 2001 Andersen Consulting adopted its current name, "Accenture". The word "Accenture" is supposedly derived from "Accent on the future". Although a marketing consultancy was tasked with finding a new name for the company, the name "Accenture" was submitted by Kim Petersen, a Danish employee from the company's Oslo, Norway office, as a result of an internal competition. Accenture felt that the name should represent its will to be a global consulting leader and high performer, and also intended that the name should not be offensive in any country in which Accenture operates. [edit] IPO On July 19, 2001, Accenture offered initial public offering (IPO) at the price of $14.50 per share in New York Stock Exchange (NYSE); Goldman Sachs and Morgan Stanley served as its lead underwriters. Accenture stock closed the day at $15.17, with the day's high at $15.25. On the first day of the IPO, Accenture raised nearly $1.7 billion.[8] [edit] Place of Incorporation ChangeAccenture announced on May 26, 2009 that its Board of Directors unanimously approved changing the company’s place of incorporation to Ireland from Bermuda and would become Accenture plc.[9]. The company cited several reasons for the change:
The change was approved and became effective on September 1, 2009, the beginning of the company's 2010 fiscal year. While Ireland is the company's headquarters for tax and legal purposes, much of the administration actually occurs in New York City and Chicago, two of its largest offices worldwide. [edit] Controversy and criticism[edit] Tax Haven HeadquartersIn October 2002, the Congressional General Accounting Office (GAO) identified Accenture as one of four publicly-traded federal contractors that were incorporated in a tax haven country.[10] The other three, unlike Accenture, were incorporated in the United States before they re-incorporated in a tax haven country, thereby lowering their U.S. taxes. Still, critics have panned Accenture's incorporation in Bermuda, generally because they viewed Accenture as having been a U.S.-based company trying to avoid U.S. taxes.[11][dead link] The GAO itself did not characterize Accenture as having been a U.S.-based company; it stated that "prior to incorporating in Bermuda, Accenture was operating as a series of related partnerships and corporations under the control of its partners through the mechanism of contracts with a Swiss coordinating entity." [edit] Movement of jobs outside the U.S.Accenture has been criticized repeatedly by Lou Dobbs of CNN and others for moving many jobs outside the U.S., resulting in loss of work and employment for some U.S. citizens. This is because Accenture utilizes a network of Global Delivery Centres around the world (seven in Europe, seven in Southeast Asia, seven in North America, and one in Africa on the island-nation of Mauritius[12]) to reduce cost and increase profit margin in outsourcing deals such as software development, application maintenance, and call center support. Its technology services competitors such as IBM also heavily leverage this model and face similar criticism. [edit] Loss of sensitive dataIn September 2007, Accenture was implicated in a high-profile case of loss of sensitive data (sometimes referred to as a "data spill") on individual American citizens. Consulting companies Accenture and Compuware had been developing the Ohio Administrative Knowledge System (OAKS), an information system for the state of Ohio. The lost information was being used in the development of the system and was on a backup computer tape stolen on June 10, 2007..[13][14] The stolen tape contained the names and Social Security numbers of: every Ohio state employee; more than half a million people who were owed tax refunds by the state of Ohio; 602 Ohio Lottery winners who had not cashed their winnings; 84,000 welfare recipients; and tens of thousands of other individuals. It also contained taxpayer identification numbers for Medicaid providers and bank account information for school districts and local governments.[15] The tape also contained sensitive information related to the state of Connecticut, also an Accenture client, that was being used in Ohio to develop a similar state government information system.[13] The tape was stolen from the car of 22 year old Jared Ilovar, an intern in the Ohio Office of Budget and Management, who had been assigned to nightly take home a backup tape and return it the next day, as part of a data security program. Ilovar's car and four others were broken into outside his apartment complex. He was fired by Ohio governor Ted Strickland during the storm of public indignation after the theft became public.[16] In a statement to the Columbus Dispatch, Ilovar said:
[edit] Subsidiaries
[edit] Visual identityThe typeface used in the Accenture wordmark is Rotis Semi-sans. The right-pointing carat character over the t is intended to indicate the company's orientation to the future. The character is similar to an accent mark in music. The corporate descriptor for Accenture is "High performance. Delivered.", which replaced the previous slogan "Innovation. Delivered." in 2004. Until December 2009, Tiger Woods had been a celebrity spokesperson for the company, whose advertising used the service mark "Go on, be a Tiger" and the ancillary statement "We know what it takes to be a Tiger." The company terminated Woods' six-year sponsorship deal on 13th December 2009 and removed references to Woods from its website.[18][19] [edit] CompetitorsAccenture's competitors in most of its business arenas are Deloitte, Tata Consultancy Services, Wipro, Infosys and primarily IBM. [edit] See also[edit] References
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