Cap Gemini Profile

CAP GEMINI ERNST & YOUNG
COMPETITIVE VENDOR PROFILE
Prepared for
IBM CORPORATION
AMERICAS MARKET INTELLIGENCE
WHITE PLAINS, NY
Prepared by
Renaissance Group International, Inc.
495 Wheeler Road
Ashby, MA 01431
(978) 386-5858
January 30, 2002
FOR INTERNAL USE ONLY
Renaissance Group International, Inc. (RGI),
495 Wheeler Road, Ashby, MA 01431
978-386-5858
TABLE OF CONTENTS
Page
PREFACE
EXECUTIVE SUMMARY
BUSINESS STRATEGY
A.
B.
C.
5
6
7
Group Ownership Model

Company Operations
Services Delivery
PRODUCT STRATEGY
A.
B.
C.
D.
E.
F.
G.
H.
I.
Applications Management Outsourcing

B2B Supply Chain
Critical Technologies
Customer Relationship Management
DareStep
Extended Enterprise Applications (EEA) and
Enterprise Resource Planning (ERP) Services
MCommerce
Strategy and Transformation
Support Services
8
10
13
17
19
21
24
25
25
MARKET STRATEGY
28
A.
B.
C.
D.
E.
28
30
31
31
32
Customers and Company Size

Account Marketing Approach
Pricing
Advertising Strategy
Competition
ORGANIZATION STRUCTURE
34
A.
B
34
35
Top Level Management

Field Presence and Headcount
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TABLE OF CONTENTS (CONT.)
Page
ALLIANCES/JOINT VENTURES/PARTNERSHIPS
38
FINANCIALS
43
A.
B.
45
46
Market Segmentation
International Results
CORPORATE STRENGTHS AND WEAKNESSES
49
INDUSTRY FOCUS
50
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
51
58
59
60
63
65
67
67
68
69
Financial Services
Health
High Growth
High Tech
Telecom, Media & Networks
Life Sciences and Chemicals
Consumer Products, Retail, and Distribution
Manufacturing
Utilities and Energy
Transportation
CUSTOMER SUPPORT
72
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CHARTS
Page
CAP GEMINI ERNST & YOUNG CAPITAL STRUCTURE
CAP GEMINI ERNST & YOUNG 1H/FY00 REVENUE BY GLOBAL MARKETS
28
CUSTOMER/INDUSTRY CHARACTERISTICS
29
SELECTED CAP GEMINI ERNST & YOUNG CLIENTS BY INDUSTRY
29
WORLD IT SERVICES AND CONSULTING COMPANIES
32
CAP GEMINI ERNST & YOUNG INTERNATIONAL PRESENCE
35
CAP GEMINI ERNST & YOUNG PRO FORMA REVENUE AND NET INCOME
44
CAP GEMINI ERNST & YOUNG REVENUE AND NET INCOME BEFORE
ACQUISITION
45
CAP GEMINI ERNST & YOUNG 1HFY01 REVENUE BY GLOBAL MARKETS
45
CAP GEMINI ERNST & YOUNG REVENUE BY LINE OF SERVICE
46
CAP GEMINI ERNST & YOUNG PRO FORMA REVENUE BY GEOGRAPHIC AREA
47
CAP GEMINI ERNST & YOUNG PRO FORMA PROFIT AND LOSS
47
CAP GEMINI ERNST & YOUNG REGIONAL EMPLOYMENT
48
CAP GEMINI ERNST & YOUNG REVENUE PERCENTAGE BY INDUSTRY
50
CAP GEMINI ERNST & YOUNG SUPPORT CENTERS
72
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CAP GEMINI ERNST & YOUNG: MARKETING STRATEGY REVIEW
PAGE 1
Prepared by RGI and by IBM Americas Market Intelligence
Preface
IBM Americas Market Intelligence has been preparing marketing strategy reports with the
assistance of independent consulting companies since 1987. All reports follow the same
standard outline; however, the level of depth and topics covered vary depending on the markets
served by the profiled company. Market Intelligence, through an assigned point of contact, works
with the independent research company during the research phase of the report.
Market Intelligence intends the report to provide a general overview of the vendors marketing
and selling strategies, with sufficient detail to cover company policy and modes of operation.
Individuals requiring specific or related information are encouraged to contact Pat SchuettLuccarelli on 8-224-4064 or pdschue@us.ibm.com.
The following report on Cap Gemini Ernst & Young has been prepared by IBM Americas
Market Intelligence and by Renaissance Group International, Inc. (RGI) of 495 Wheeler Road,
Ashby, Massachusetts (978) 386-5858.

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Executive Summary
With Cap Geminis acquisition of Ernst & Youngs consulting business having been finalized
in May 2000, the combined entity, Cap Gemini Ernst & Young, represents one of the largest
management and IT consulting firms in the world. In fact, the latest ranking provided by the
Groups estimations, based on its 2000 revenue, places it as the fifth largest IT Services and
Consulting company, following IBM Global Services, EDS, Andersen Consulting, now known as
Accenture, and CSC. Overall, Cap Gemini Ernst & Young offers management and IT consulting
services, systems integration, and technology development, design, and outsourcing capabilities
on a global scale. The company helps businesses to implement growth strategies and leverage
technology in the new economy.
Before the Ernst & Young acquisition, Cap Gemini formerly had been referred to as Cap
Gemini Group. This group was formed from the 1975 merger of three information technology
services and consulting companies -- Sogeti, set up by Serge Kampf; CAP, formed in 1962; and
Gemini Computer Systems, formed in 1973. The group initially focused on developing its IT
services business in Europe and the U.S. and then established its management consulting
business under the name Gemini Consulting. In general, the company categorizes the period
since 1990 as years of expansion, helped by various strategic acquisitions that include three
management consulting companies and several IT services companies. More specifically, Cap
Gemini purchased two U.S.-based management consulting companies -- United Research and
the MAC Group -- as well as Gruber, Titze & Partner in Germany. As it relates to the companys
IT services, Cap Gemini purchased Hoskyns in the U.K., Programator in Scandanavia, and
Volmac in Benelux. In the past few years, Cap Gemini merged the activities of the Bossard
Group with those of Gemini Consulting, acquired Beechwood -- a U.S.-based company
specializing in IT services for telecom operators -- and acquired a 50% share in Twinsoft Benelux
companies previously held by Compaq. Ernst & Young Consulting units most recent acquisition
nearly doubles the companys revenue and significantly increases its U.S. consulting presence.
Gross margin gains

Cap Gemini faced strong margin pressure during 1992, 1993, and 1994, posting
negative net margins for each of the three years. Over the past few years, Cap
Gemini has benefited steadily from cost containment efforts, raising its operating
margins from 6.1% during 1HFY96 to 10.5% on FY00 on a pro forma basis. While
the operating margin shows sign of decreasing significantly for FY01, company
management and analysts alike appear confident that the Group again will realize
margins in the 10% neighborhood. In fact, CGE&Y posted a 6.1% operating margin
for 1HFY01,which compares to an operating margin of 10% for the same period one
year ago. The Group says that this decrease was due in large part to difficulties
encountered in the telecommunications sector. Looking again to increase its
operating margins, during mid-year 2001, the Group announced a restructuring plan
that includes a goal of increasing operating margins in 2HFY01 to roughly 9%.
Subsequently, CGE&Y provided further indication that the events of September 11
pushed back the hope of a growth recovery by at least one to two quarters. In this
event, RGI believes that the Group may not realize its initially anticipated increase in
operating margins until 2002.
Product/services offering

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Cap Gemini Ernst & Young provides a core range of revenue- generating consulting
and IT services. Its management consulting and IT services offering includes full
lifecycle services, based on industry specific expertise in areas of applications
management, enterprise resource planning, electronic commerce customer
relationship management, and management consulting. Looking at the Ernst &
Young component, the company rounds out the companys presence in the U.S. and
significantly contributes e-commerce and e-business consulting capabilities.
Global geographic presence

The completed purchase of Ernst & Young Consulting in May 2000 significantly
strengthens Cap Geminis position in the U.S. and Germany. In addition, as
companies require advice on developing an Internet business, the purchase of Ernst
& Youngs consulting unit not only reinforces Cap Geminis management consulting
business, but it also profits from installing the required systems. In general, it has
long been considering a means of strengthening its presence in the U.S., the largest
software and consulting market in the world. In addition, Cap Gemini Ernst & Young
touts its size as a core strength in its ability to serve global customers.
Despite these strengths, Cap Gemini exhibits some weaknesses and faces some risks, as
follows:
Balance sheet intangible assets

Cap Gemini Ernst & Youngs latest balance sheet carries $1.8B of intangible assets,
which the Group describes as market share arising from its various company
purchases. If this sum had been classified as goodwill at the time of each
acquisition, it would have been charged against profit. The Group considers the
acquired companies market share resulting in multiyear contracts durable in time
and earnings potential.
Pricing climate
The pricing climate for the U.S. consulting and systems integration markets appears
tough due to ongoing economic weakness. Some analysts estimate that Cap Gemini
Ernst & Young has reduced its prices for these service by close to 15% as of midyear 2001 in the U.S.. In fact, some believe that the pricing environment has
worsened in the U.S., as well as in Europe during the latter half of CY01. Given the
state of the IT labor market, analysts say that they see minimal chance of price
stability in this sector over the short term.
Continued competition
The industry consolidation of Cap Gemini and Ernst & Young increases the
competition among a defined few. The merger of Price Waterhouse and Coopers
and Lybrand, as well as the split of Andersen Consulting, now known as Accenture,
from Arthur Andersen certainly played a role in the Cap Gemini and Ernst & Young
acquisition decision.

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While the purchase of Ernst & Young Consulting Services remains the largest transaction in
the industry, the combined operations faces a greater level of uncertainty than it did a year ago.
During the past year to a year and a half, Cap Gemini not only completed the Ernst & Young
integration, but also now faces a weakened economy. Once estimating a combined Groups
revenue increasing 14% over FY01, the Group has subsequently posted a nine-month 2001
revenue increase of just 5% on a pro forma basis. In fact, the Group currently refuses to project
revenue for the near term. Instead, it takes a cautionary stance, outlining several scenarios that
range from a moderate growth continuation to a reduction in global volume of business activity
due to the persistence of a generally depressed climate. Although the near term appears a
challenge for Cap Gemini Ernst & Young, analysts and Group management continue to tout the
successful operations integration and the synergies of the Ernst & Young acquisition. Taking
some corrective measures, Cap Gemini Ernst & Young appointed Group COO, Paul Hermelin, to
the additional role of CEO and announced a restructuring that includes a workforce reduction, as
well as multiple cost containment efforts. The organization reached approximately 60,000
employees as of December 2000, with reported pro forma 2000 revenue approaching $8B. It
now claims roughly 56,000 people worldwide.

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Business Strategy
Cap Gemini Ernst & Young realized its fair share of change since purchasing Ernst &
Youngs consulting arm in May FY00. Once billed as one of the most promising and largest
acquisitions during 2000, the combined companys year-over-year net income likely will fall by
more than one-half on relatively flat revenue. While the overall structure and solutions offering of
the organization appear strong, analysts point to weak economic conditions and poor timing for
CGE&Ys shortcomings. In particular, the purchase of Ernst & Young Consulting Services
significantly built the Groups North American presence at a time when the U.S. economy showed
signs of faltering. Looking to again boost revenue, Cap Gemini Ernst & Young appointed its
COO, Paul Hermelin, to the added role of CEO, replacing Geoff Unwin in early January 2002. It
also announced cost containment efforts, including staff cutbacks, reductions in spending, and
the postponement of several initiatives. In general, CGE&Y realized a slowing of revenue
throughout the U.S. and many markets overseas in core industries. These range from
telecommunications and financial services to the high-tech and manufacturing sectors.
Instead of increasing its combined revenue, some analysts estimate that the combined FY01
revenue may fall short of its $7.6B posted the year before. This purchase strengthens Cap
Geminis offering by adding e-business capabilities, while building on its market presence in the
U.S. and Germany, as well as throughout the rest of Europe and the Asia/Pacific region.
Finalized in May 2000, Cap Gemini acquired nearly all of the Ernst & Young consulting business,
with headcount of roughly 18,000 and FY99 revenue of nearly $3.5B. The combination of the two
companies yields mutual benefits. The SEC had pressured Ernst & Young to separate its audit
functions from its consulting practice and Cap Gemini. With revenue increasing just 9% in FY99,
analysts thought that the company could become a peripheral player if it had not increased its
presence in the U.S. Further defining the transaction, the purchase enables the combined Group
to:
Become a major player in the U.S. (the U.S. represents more than one-third of its
revenue) and strengthen its position in Germany;
Realize an expanded industry coverage and, therefore, become the firm of choice for
major worldwide organizations;
Significantly expand in consulting, a high added-value segment of critical importance

that provides clients with a range of services; and
Implement on a larger scale all skills required to help its clients face the challenges of
the connected economy -- strategy consulting, innovation, deployment of new
technologies, knowledge management, human resources, and marketing.
A. Group Ownership Model

Three information technology services and consulting companies originally formed Cap
Gemini Group in 1975 and, with the Ernst & Young Consulting acquisition in May 2000, is now
referred to as Cap Gemini Ernst & Young. At this time, it changed its capital and management
structure, reverting to a Board of Directors and an Executive Committee. Overall, the Cap Gemini
Ernst & Young still has three core shareholders: CGIP, a French-owned industrial group; Serge
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Kampf, Founder and Executive Chairman; and Ernst & Young U.S. LLP. The remaining shares
are publicly traded with no shareholder owning more than 5% of the Group. The capital structure
does change from time to time. For example, Daimler-Benz InterServices (DEBIS) divested its
shares from the Group during 1997. Similar to the structure of Electronic Data Systems and
General Motors, GM at one point held an ownership share in EDS. RGI notes that DEBIS held a
24% share as recently as March 1997. As of December 2000, CGIP held 13%, Founder and
Executive Chairman, Serge Kampf held 5%, and Ernst & Young held 6%. The remaining stake of
76% is public.
Cap Gemini Ernst & Young Capital Structure
CGIP
(13% Share)
Serge Kampf
(5% Share)
Public
(76%)
Ernst & Young

US LLP (6%)
CAP GEMINI S.A.
Operating Companies
Source: Cap Gemini Ernst & Young
B. Company Operations
Cap Gemini Ernst & Young operations consist of a combination of Global Units and Centers
of Excellence, focusing on key markets and industries addressed by the Group. More
specifically, it has five Global Sector Units: Consumer Products, Retail and Distribution; Energy
and Utilities; Financial Services; High Technology and Automotive; and Life Sciences and
Chemicals. In addition, the companys Telecom, Media, and Networks business unit in alliance
with Cisco Systems targets the telecom industry. The Group also has several Centers of
Excellence. These not only focus on solution areas, including ERP and mobile commerce, but
also several industries such as automotive.
The Groups structure also includes various Service Centers that cover application areas,
including Applications Management, Enterprise Management, Integrated Supply Chain
Management, and Customer Relationship Management. Other operational areas include
technology labs. It launched its Netherlands-based Mobile Technology Lab, which is dedicated to
developing mobile Internet technologies and, in an effort to help enterprises with continued
innovation, CGE&Y established the Center for Enterprise Creation. The Center provides services
covering all aspects of an enterprise launch, including strategic planning, technology architecture,
operations definition, organization design, systems development, user experience design,
temporary office space, and administrative support with a co-creation mindset.

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C. Services Delivery
To deliver its services, Cap Gemini Ernst & Young consultants utilize PERFORM, the firms
ISO-9001 compliant quality system. PERFORM acts as a transnational set of standards, guides,
templates, and best practices. The Group has been ISO 9001 certified since 1994 and covers
Cap Gemini areas such as study, design, implementation, and maintenance of information
systems.
RGI notes that CGE&Y uses On Time and Above Customer Expectation" (OTACE) to
measure how its teams perform against client expectations and against the project timeline. At
the beginning of each engagement, it meets with the client to determine the metrics that will be
used to define success. For 2000, CGE&Y says that it had an OTACE measurement of 93% -meaning that it met or exceeded client expectations 93% of the time during the year.

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Product Strategy
Cap Gemini Ernst & Young represents one of the largest management and IT consulting
firms on a worldwide basis. In fact, the Group claims to be the number one IT consulting services
provider in North America and to be ranked in the top five for professional services. The new
company combines the resources of Gemini Consulting, Cap Gemini IT Services, and the recent
acquisition from Ernst & Young LLP, Ernst & Young Consulting Services. Overall, the Group
offers management and IT consulting services, systems integration, and technology
development, design, and outsourcing capabilities on a global scale. It helps traditional
businesses and Internet-based companies to continue to explore growth strategies. RGI further
defines its solutions offering as follows.
Management Consulting -- Cap Gemini Ernst & Young offers services that focus on
business strategy, operations, and people and information management. The firms
management consultants help clients make decisions about where to allocate
resources to deliver the maximum return on their investments. From improvements
in production and distribution, including e-business strategies, to better reporting and
quality control, clients develop roadmaps that help them gain a competitive
advantage over rivals and sustain that advantage over time.
Systems Transformation -- The firms services in this area fall into two categories,
including development of customized software or hardware for a specific client. It
also covers systems-integration projects, conducted in partnership with hardware
manufacturers, software companies, and other partners. Cap Gemini Ernst & Young
drafts specifications, designs the architecture, and handles the development and
implementation of the new system.
Information Systems Management, Outsourcing -- Information Systems Management

(ISM) oversees the day-to-day operation of the clients business. The firm assumes
responsibility for all or part of customers information technology resources through
the following service offerings: Applications Management (AM) and Infrastructure
Management (IM).
A. Applications Management Outsourcing

Cap Gemini Ernst & Young claims to be the leading European provider of Applications
Management (AM) services. When delivering AM services, CGE&Y assumes contracted
responsibility for the continuous management and execution of activities related to the support,
maintenance, enhancement, and evolution of applications. The company goes on to say that its
U.S. operations offers an extensive portfolio of outsourcing services that deliver the results that
companies look for in business focus, technology improvement, cost management, and access to
resources. It developed an approach to outsourcing service delivery that combines best-in-class
tools, industry leading processes and methodologies, and teams of specialists that help clients
focus on the strategic imperatives that position them for competition.
These services have several key characteristics:

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A global network of Applications Management Service Centers (AMSCs) that deliver

economies of scale through industrialized processes and mutualized resources;
A methodology that integrates the Carnegie Mellon Software Engineering Institute's

Capability Maturity Model (CMM) into its ISO-9001-compliant PERFORM processes
and leverages global best practices;
Measured delivery through customized, adaptive Service Level Agreements (SLAs)

based on its clients' specific and evolving requirements and priorities; and
Flexible delivery options that provide a solution to meet specific business needs.
A. 1. Applications Management Service Centers
CGE&Y deployed a global network of dedicated Applications Management Service Centers

(AMSCs offering a standardized alternative approach to applications management. With
operational and financial benefits, remote delivery increasingly has become the model of choice
for its customers. CGE&Ys AMSCs deliver on improved efficiency and reduced cost by adhering
to several key principals:
Mutualization of resources -- Leveraging and sharing skilled expertise and resources

across multiple clients to increase flexibility, lower risk, reduce cost, and improve
service;
Industrialization of processes -- Standardizing the methodologies and processes to

implement a factory approach engineered for high productivity and low cost; and
Automation of tools -- Integrating and automating the tools to deliver improved

productivity and enhanced reliability.
A. 2. Rigorous Proven Methodology
Cap Gemini Ernst & Young U.S. uses its propriety, ISO9001-compliant methodology,
DELIVER, developed over more than 10 years, for the transition and delivery of its Applications
Management services. The DELIVER AM module comprises the best practices, methods,
techniques, and tools for the management of all phases of the lifecycle of applications
management. The Group also integrated the Carnegie Mellon Software Engineering Institute's
(SEI) Capability Maturity Model (CMM) into its ISO9001-compliant disciplines to provide clients
with improvements in software development, service delivery, speed, productivity, and cost.
A. 3. Measured Delivery

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Cap Gemini Ernst & Young U.S. LLC implements, delivers, measures, and reports on a full
compliment of performance metrics designed to meet the service needs of its customers:
Statement of Work (SOW): sets out the "what" of service delivery.
Service Level Agreements (SLAs): its "living" SLAs define the "what, how much, and
how well" of the engagement and allow the service to evolve throughout the life of the
engagement.
Operating Level Agreements (OLAs): defines the "how much" and "how well" among
multiple service providers to ensure seamless, undisrupted delivery and minimize
"finger pointing."
Service Quality Plan: defines the roles and responsibilities, process flows, and
communication and reporting among clients, CGE&Y, and third-party vendors by
outlining how it will deliver expected client results and key deliverables.
OTACE (On Time and Above Customer Expectations): defines how the Group
continually measures and improves customer satisfaction, based on criteria
individually defined by its clients.
A. 4. Flexible Delivery Options
In addition to responsive, measured service, Cap Gemini Ernst & Young U.S. blends a mix of
services and delivery options to craft a solution that will best fit its clients' needs.
Manage a portfolio of applications or selected ones.
Deliver services from a site or from its Applications Management Service Centers
(AMSCs).
Deliver a full-service solution, working in conjunction with the Groups alliance

partners, or a custom solution that focuses on specific service components, including
AM, infrastructure management, business process management, and help desk.
Offers a full service help desk capability in support of a clients applications that can
improve levels of problem resolution and optimize operations.
Supplies the necessary staffing resources or implements established procedures for

the transition of existing staff into CGE&Y.
Offers a service-based pricing model with both fixed and variable components that
can be controlled, based on the predefined levels of service.
B. B2B Supply Chain

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With specialists based in the Americas, Europe, and Asia Pacific, Cap Gemini Ernst & Young
U.S. is a leader in B2B Supply Chain consulting. In addition, it provides solutions across
Customer Relationship Management, Information Technology, and Strategy Transformation
designed to deliver value across the enterprise. The Group helps clients build adaptive supply
chains by enabling them to get closer to customers, collaborate more effectively with suppliers,
leverage digital marketplaces, and optimize the use of information. Overall, its suite of supply
chain management services ranges from supply chain strategy and architecture development, to
business and technology integration, to full-service process and technology outsourcing. In
addition, it has developed new offerings to address the market's customer-centric business
challenges and to help companies build dynamic, adaptive supply chains. CGE&Ys specific
service offerings include the following.
Supply Chain Transformation This offering determines a company's customer

target market, core competencies, manufacturing and purchasing opportunities,
organizational structure, and connectivity options. Based on a technology
framework, the Supply Chain Transformation approach focuses on matching supply
and demand through fulfillment execution. Its Supply Chain Transformation services
utilize the Networked Value Chain (NVC) solution as the core foundation to build
adaptive supply chains. The multi-tiered architecture gives companies the ability to
collaborate with business partners at increased velocity, while growing a broader,
more loyal customer base. It also integrates multiple and disparate supply chains,
delivering differentiated products and service bundles to customers.
Demand and Supply Chain Optimization -- Cap Gemini Ernst & Youngs Demand and
Supply Chain Optimization plays a role in translating business strategy into
operational execution. Essentially it becomes the company's operating plan and
provides much of the integration needed for making optimal decisions. CGE&Y's
Demand & Supply Chain Optimization services range from strategy development to
organizational design and change management to collaborative planning, forecasting
and replenishment (CPFR). The Group goes on to say that its solutions can deliver
major improvements in operating expenses, working capital efficiency, and customer
service while greatly leveraging ERP investments. It also helps companies overcome
functional barriers and uncertainty between trading partners, which can threaten
supplier relationships and add unnecessary costs.
Sourcing and E-Procurement -- CGE&Ys Sourcing and E-Procurement services

provide an approach to transforming purchasing. This results in increased value from
externally sourced goods and services and managed purchasing costs for the
connected economy. Transforming sourcing and e-procurement can reduce an
organization's direct cost of goods and services from 5% to 15%, while decreasing
cycle time and time-to-market, and improving supplier relationships and
product/process quality. In general, its Sourcing and E-Procurement solutions
leverage Internet technologies to develop and deploy strategies and solutions that
connect clients to their suppliers. By consolidating buying volumes, negotiating
improved pricing, managing suppliers, focusing on demand management, and
enhancing catalog maintenance and control, business processes can be streamlined,
company profits enhanced, and customer expectations exceeded. CGE&Y's
Sourcing and E-Procurement solutions include strategic sourcing, design and
sourcing, dynamic commerce, e-catalog and content management, and eprocurement.

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Logistics and E-Fulfillment -- The Cap Gemini Ernst & Young approach focuses on
an end-to end, Logistics and E-Fulfillment solution that encompasses supply chain
processes from the time the customer places the order to the time it is paid for and
delivered. To fulfill a customer requirement, CGE&Y provides end-to-end fulfillment
integration through total supply chain visibility, connectivity to join all partners, and
physical delivery. CGE&Y's solution focuses on the customer and synchronizes the
partners and drivers across the entire supply chain. Its Logistics and E-Fulfillment
solution includes assessment, future state model design, build, exchange
marketplace, and operate.
Adaptive Manufacturing and Operations -- Adaptive manufacturing is a key step in

the evolution of lean and agile organizations. It provides a connection between the
manufacturing and shop floor operations and the critical enterprise applications.
CGE&Y provides clients with Adaptive Manufacturing and Operations solutions to
help foster enterprise-wide communication, collaboration, responsiveness, and rapid
decision making/execution. As a result, organizations can realize cost savings and
productivity gains to maximize overall organizational yield. Each of these
customized solutions builds on the previous one to create a roadmap to an adaptive
operation: lean manufacturing, enterprise connectivity, real-time performance
management, decision support system optimization, and distributed decision and
control.
Private Marketplaces -- Private marketplaces transcend the traditional relationships

between the company and its members. The company owning a private exchange
anchors it, and that anchor company needs to have the ability to attract the target
members to its network. Compared to other marketplace models, a private exchange
goes beyond procurement to achieve higher levels of collaborative commerce faster
and focus on value creation among members. Cap Gemini Ernst & Young helps
companies build successful, private marketplaces by following a number of steps:
Confirm and validate company strategy, direction, and basis for competitive
advantage;
Identify key communities-of-interest;
Define appropriate private marketplace scenarios or each viable community of

interest;
Validate each private marketplace scenario by comparing it with potential

alternatives and absolutes; and
Compare the private marketplace options to select the highest priority

opportunity.
B2B Technology Solutions -- With a combination of industry knowledge and B2B

marketplace experience, the Group helps companies make B2B exchange decisions.
Its B2B Technology Solutions services help companies achieve bottom-line gains
through improved efficiency and increased revenue opportunities, while reducing the
risks inherent in B2B marketplace participation. It also offers dedicated marketplace
connection centers and proprietary process accelerators to increase a company's
speed to connectivity. The following methodologies help businesses navigate the

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technical, organizational, and process changes necessary to connect to B2B

marketplaces:
Strategy -- Examines the role of marketplaces in a specific industry, determines

the service offerings to employ, and identifies the value creation.
Readiness Assessment -- Analyzes a company's internal business processes,

current technology infrastructure, and organization to define the gap between
current capabilities and the requirements to join an exchange.
Vision and Roadmap -- Features an Exchange Connection Workshop with

executives to develop the vision of exchange participation and a detailed action
plan for connecting to B2B marketplaces.
Design -- Constructs the technical and process design and operating model while
selecting the applications and implementing the supporting technical architecture
to provide a powerful and effective exchange connection.
Implementation -- Carries out the connection architecture at CGE&Y's B2B

Marketplace Center of Excellence with a staff of technology professionals that
follow a phased process, delivering increasingly robust levels of integrated
functionality.
The Group employs the Networked Value Chain (NVC) as a solution framework for building
more adaptive supply chains. Tailored to each clients requirements, this business integration
model is built on key supply chain and customer relationship management processes. The NVC
multi-tiered architecture enables companies to collaborate with business partners at increased
velocity, while growing a broader, more loyal customer base. It also integrates multiple and
disparate supply chains to deliver differentiated products and service bundles to customers.
From strategy through implementation, NVC contributes improved visibility of product and
inventory, better management of demand variability, and increased profitable volume through the
supply chain.
In the 1980s, first-generation supply chains focused on functional excellence. In the early
1990s, second-generation supply chains moved to a transaction-based approach. Currently,
networked value chains require new ways of thinking that involve integrated decision making
between trading partners and even the collaboration of competitors to make joint decisions.
Therefore, third-generation supply chain excellence delivers maximum supply chain yield so that
revenue and profits increase and shareholder value increases. To support this point of view, B2B
exchanges connect an organizations ecosystem of suppliers, partners, and service providers to
optimize the extended supply chain. To help companies accomplish this integration, CGE&Y
adopts innovative capabilities, such as:
Collaboration platforms;
Global visibility;
Dynamic pricing;
Integrated supply/demand management; and
Supplier e-hubs.
C. Critical Technologies
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CGE&Y holds a vision of how to deploy, manage, and leverage Adaptive IT. Focusing on an
ecosystem of partners, suppliers, competitors, and customers, it helps clients align an IT
organization and efforts to be dynamically responsive. Adaptive IT acts as the foundation of the
CGE&Y Critical Technologies solution area. CGE&Y can help an organization achieve adaptive
IT through a range of services, organized within three main service areas:
Adaptive Development & Integration;

Network Infrastructure Solutions; and
Technology Consulting Services.
C. 1. Adaptive Development & Integration (AD&I)
CGE&Y houses its Advanced Development & Integration (AD&I) solutions within four service
portfolios of technology offerings: Business Intelligence Solutions (BIS), Build and Integrate
Solutions, Technology Advisory Services, and Customer Relationship Management.
Business Intelligence Solutions

As one of the primary e-teams of the AD&I Business Unit, Business Intelligence Solutions
plays a role in advancing the charter of AD&I -- making CGE&Y the leading technology solutions
provider in the market. BIS represents a diverse set of solutions and services and comprises a
wide range of competencies. From data modeling to strategy management, data warehousing to
performance management, and enterprise data integration to executive information systems, BIS
forms an integral component of its firm's ability to sell and deliver high-value solutions.
Build and Integrate Solutions

Its Build and Integrate Solutions deliver services that enable clients to customize and extend
their systems in the evolving e-commerce environment. CGE&Y's Solutions in this area include
ERP integration, eStorefront, eC Rapid Start, Java, Portals and Communities, Rapid
Requirements Workshop, eLegacy Web Enablement, Replatforming and Web Extension and
Best Practices, IBM, and Microsoft.
Technology Advisory Services

After having consulted with the client on eStrategy, CGE&Y's Technology Advisory Services
continues through the development of architectural plans and the transformation of the IT
organization. The firms Technology Advisory Services group develops the technology strategy
for e-commerce and creates the supporting architecture.
Customer Relationship Management

The Customer Relationship Management team looks to assist clients in maximizing their rate
of growth by developing strategies, allocating resources, and aligning operations in a manner that
creates a customer portfolio. The CRM team assists clients with the research, analysis, and
visioning associated with the development of the optimal relationship strategy. This includes
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building a customer portfolio, maximizing the range of value delivered, identifying the most
appropriate role to play within the market, and determining the balance of risk/reward associated
with the customer relationship.
C 2. Network Infrastructure Solutions
The firm offers a range of services supporting the design, build, and implementation of an
enterprise network. In addition, CGE&Y and Cisco Systems have a partnership to provide
technology infrastructure solutions that enable service providers and enterprises to connect to
their clients. Overall, CGE&Y's Network Infrastructure Solutions service line (NIS) brings
expertise and knowledge in the design and deployment of infrastructures for service providers
and enterprises. To accelerate a company's infrastructure transformation, NIS emphasizes
services around Cisco products and services.
For enterprises:
Transition from bricks-and-mortar to e-business;
Connectivity to all constituents - customers, suppliers, distributors, and employees;
Business growth, merger and acquisition/consolidation;
Reduction in operating infrastructure complexity;
New products/ markets/businesses;
Convergence of voice/data technologies;
Changes in regulatory environment;
Protection of information assets; and
Secure, always-on (24x7), global operations.
For service providers:
Changes in regulatory environment;
The need to provide IP-based services, requiring move from circuit-switched to

packet-switched infrastructure;
Business growth, merger and acquisition/consolidation;
Growth in broadband market;
Lack of integrated OSS infrastructure to manage growth and new services; and
NOC consolidation.
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NIS provides a range of services for clients looking to leverage the connected economy.
CGE&Y's NIS service offerings include the following.
Infrastructure Gap Analysis -- Analyze how a client's infrastructure supports its

business needs and define a roadmap for aligning the infrastructure with business
needs and industry best practices.
Design Infrastructure -- Develop an infrastructure blueprint based on business and

functional requirements optimized for the client.
Build Infrastructure -- Manage the overall deployment of an infrastructure (per design

blueprints), including configuration/installation, testing, production migration/cutover,
and project management.
Design and Build Network Operation Centers (NOC) -- Provide network management
strategies, platform architecture, software implementation, physical design, operating
procedure development, and staffing models for the development of NOCs.
ECOstructure Solutions -- Design high availability infrastructures based on the

ECOstructure blueprints.
Security Services -- Analyze, design, and implement security solutions for network
and infrastructure at a level consistent with the client's overall security policy.
C. 3. Technology Consulting Services
Technology Consulting lies at the heart of CGE&Ys technology offerings and represents a
key enabler for many of the services employed in the global marketplace. CGE&Y looks to build
on its technology expertise, developing an increasingly rich ecosystem through a range of
technology alliances. The company delivers the appropriate support to various customers across
multiple sectors.
The Group works with its customers to define an IT strategy and translates that into viable
and sustainable solutions that meet business objectives. As a global leader in technical
architectures, its capabilities span creation, design, audit, and optimization, as well as
development and implementation. Using architects, technology, product, and discipline
specialists and technical design authorities, CGE&Y ensures that initial concepts and
requirements can be developed through its ASE (Advanced Solution Environment) and ISOcertified project management disciplines. Its technology consulting offering includes the
following.
IT Strategy -- CGE&Y focuses on developing technology strategies that can be

integrated with its client's business strategy. The Group helps clients create a high
performance value by designing architectures, strategic plans, and governance
processes.
Architecture Services CGE&Y delivers secure, profitable, and innovative

architectures through technology consultants by applying CGE&Y's Architecture
Framework, supported by its ATAD (Adaptive Technology Architecture Definition)
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service. CGE&Y provides architecture services across various dimensions of the IT

landscape, including applications, information, infrastructure, governance, and
security.
IT Transformation -- CGE&Y provides a roadmap to support clients through the IT

change process, aligning the business and achieving stakeholder agreement. Its
experience encompasses assessment of the appropriateness of existing IS/IT
strategy, initiative portfolio prioritization, transition planning, and assessment of an
organization's capability to implement a vision and support major change.
IT Security -- CGE&Y's security service offering spans security health checks,

security strategy and management, risk management, security technologies, and
day-to-day operations. It reviews, designs, and builds connected and progressive
management services aimed at securing the overall enterprise. The Group also has
specific responses to the needs of the e-commerce economy and provides robust
solutions for secure e-business environments.
Adaptive Architecture (NRP) -- It creates for clients a user-centric platform with an ecommerce infrastructure. This enables users from different organizations to share
data and processes. In summary, it enables a new business paradigm, replacing inhouse functions with value chain processes across multiple users, organizations,
suppliers, and devices. The Group creates platforms that underpin e-business
models.
D. Customer Relationship Management

CGE&Y provides strategies for the entire customer lifecycle by offering a variety of standalone and integrated solutions to capitalize on CRM opportunities. The approachs foundation to
CRM includes the customer experience, which is supported by a company's ability to know,
target, sell, and service its customers. Its solutions lineup includes the following.
CRM Integrated Offerings
CRM Point Offerings
D. 1. CRM Integrated Offerings
CGE&Ys CRM Integrated Offerings fall into several areas, including Strategy Alignment,
Touchpoint Integration, Real-Time Marketing, Price Optimization, and CRM for Exchanges.
Strategy Alignment -- Development of a CRM roadmap and business case to align

CRM initiatives to corporate objectives through Customer Experience Mapping,
Business Process Modeling, and Technology Application Architecture. CGE&Y uses
the CRM Index as a step in assessing the potential role of CRM in supporting a
companys business model.

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Touchpoint Integration -- CGE&Y says that the implementation of CRM involves

execution on two dimensions: (1) full "web-centric" connectivity with constituents and
(2) business intelligence applied real-time across the connected touchpoints. This
includes the fusion of e-business and CRM across the front- and back-office (sales,
ordering, and service). It also covers the development of an "e" strategy for
integrating across multiple customer touchpoints, using a single IP network (voice
and data). In general, the Group offers five components of Touchpoint Integration:
Internet sales and ordering, Internet service and contact center, content
management, virtual (mobile) sales and service, and communication infrastructure.
Real-Time Marketing -- Real-Time Marketing represents the business intelligence

component of full enterprise CRM. CGE&Y designed the Real-Time Marketing
offering to plug into the Touchpoint Integration component architectures, providing
near-real time, two-way offer exchanges to its clients' customer base.
Price Optimization -- Considered a sister solution offering to the Real-Time

Marketing, Price Optimization provides CGE&Y clients with a variety of business
intelligence-based pricing strategies that can be executed in near-real-time. These
pricing options include dynamic pricing (per market), target pricing (highest margin),
and promotion pricing (correlates to increased sales).
CRM for Exchanges -- This offers the addition of baseline CRM functionality for
exchanges and their constituents. It covers six key components: common contract
repository; 360 degree view of buyers and sellers; customer support (billing and
settlement); recruiting of participants: contact management through telesales and
field sales; common marketing repository (combination of marketing, business
intelligence and content management); and internal and external reporting.
D. 2. CRM Point Offerings
CRM Reengineering -- CRM Reengineering involves the transformation of a client's

current CRM landscape into a practices organization using various CRM people,
process, and technology methods, tools, and enablers.
Stand-alone Web Services -- Stand-alone Web Services integrate people, processes,

and technology to create an optimal Web customer experience. This includes
marketing, sales, order management, and service, with respect to the Web.
Sales Force Automation -- Sales Force Automation software includes products

designed to meet the routine needs of the sales representative. The product helps
the sales professional organize and collect information about territories, customers,
products, competitors, marketing campaigns, and pricing. The features include a
customer database, lead qualification, integrated word processor, report writer,
address and phone card system, and a tickler file. Additional offerings include an
opportunity management system, sales order or sales configuration tools, marketing
encyclopedia, reporting and forecasting, and Internet access. CGE&Y also
implements technologies, including Siebel Systems, Nortel Networks, and Oracle 11i
products.

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Contact Center Services -- This solution involves the evolution of traditional call
centers from a telephony-based cost center to a profit center. It provides the
capability to management customer relationships through multi-channel/touchpoint
customer interaction. CGE&Y assists clients in transforming or optimizing their
existing call center by evaluating call center performance and developing future state
customer service offerings across customer access channels. The Group also
develops Greenfield call centers for clients, from the ground up.
E. DareStep
Launched in March 2000, DareStep operates as an entrepreneurial venture, helping
companies design, build, and establish their online brand in the business-to-consumer
marketplace. Located in New Yorks Silicon Alley, DareStep helps companies launch their online
business or new offerings, including e-business strategy, technology, creative design, and
interactive marketing and branding services. DareStep operates on a global basis, with a
presence in countries including Australia, Canada, Finland, France, Germany, Italy, The
Netherlands, New Zealand, Portugal, Spain, Sweden, U.K., as well as the U.S.
The company offering focuses on four areas: Strategy, Branding, Creative, and Technology.
Strategy -- CGE&Y realizes that the Internet changes the boundaries of a business
and creates new relationships with customers and trading partners. This results in a
need for new business models, organization structures, technologies, and branding.
As part of Cap Gemini Ernst & Young, DareStep brings together a team of experts
from the fields of e-commerce, technology, applications development, business
architecture, creative design, information architecture, and the telecommunications
industry and operation support systems. It says that it can work quickly to help
clients to develop a complete e-business strategy, from start to finish.
Branding -- A brand is reflected in a customer's total online experience -- from

design, performance, usability, and product mix to the ability to deliver on customer
expectations. Whether a client has been leveraging an existing brand through the
Internet, developing a new digital brand, or deciding between the two, DareSteps
branding and marketing team looks to help clients develop a brand strategy.
Creative -- Its creative team will design a site that conveys the spirit of a brand and
supports the customers e-commerce strategy. DareStep designers help clients
create a visual presence on the Web that reaches out to target audiences and clearly
communicates a message via a range of multimedia technologies. These include
animation, audio, video, interactive 3-D, panoramic VR photography, and enhanced
interactivity.
Technology -- DareStep can help customers leverage new technology in several

ways. These include personalizing content for each customer, integrating systems
across multiple entities that support a brand, integrating and communicating
throughout a value chain, component-based custom-system development, Webbased package selection, implementation, and integration, as well as security and
privacy. It also includes accelerated architecture definition and design,
outsourcing/operations, and Web hosting.
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DareStep combines the capabilities of Strategy, Creative, Branding, and Technology to

deliver value-based services for clients.
E-Business Cost Effectiveness -- DareStep says that an effective e-business

performance management tool provides cost effectiveness as well as cost efficiency.
It reduces e-business operating costs by aligning operations and providing
performance indices and accountability between e-business and traditional business
units.
E-CRM Integration -- E-CRM integration ensures that consumers have a value-added

experience when interacting with a company. Whether dialing into a call center or
communicating via the Internet or a hand-held device, customers should have access
to the same information. This environment also should facilitate transactions
between companies and the customer.
Idea to Launch -- This includes everything needed to build an online venture. Idea to
launch is a package created for those clients seeking a broad array of integrated
services to launch an idea. It covers details from the initial concept to launch. Many
clients may wish to pick and mix these services, tailoring them to specific needs at
any given time.
Multi-Channel Interaction -- DareStep touts this as a way to implement and get the
most out of multiple channels, such as mobile devices, PDAs, broadband, and the
telephone. New digital channels continue to proliferate, with an increasingly wide
range of features and requirements. As a result, companies face the challenge of
providing their users with a consistent user experience. CGE&Y says that these
companies need to rationalize their existing channels and develop new ones to
creating an effective multi-channel presence.
Next-Generation -- DareStep offers an objective formula to enhance the value of an

existing online firm to improve its communication and create a strategy for growth.
Most companies have developed and expanded on their first-generation Websites
successfully. However, it finds that they now need to revamp or relaunch by taking
their sites to next-generation e-business and user experience.
Website Effectiveness -- It touts this as a methodology for analyzing site

effectiveness and prescribing solutions. For the optimization of a site's performance,
Website Effectiveness diagnoses an organizations current Website, either as a oneoff project in itself or as the first step in a larger work project. DareStep helps to
identify and analyze site performance problems. It also suggests ways of optimizing
that performance.
Integrated Technology Delivery -- DareStep takes complete advantage of its

affiliation with other members of the Cap Gemini Ernst & Young group. Working with
the ASE and key software suppliers, DareStep remains committed to speeding up
lead times and improving quality. DareStep has the resources to take its clients from
an initial idea to a fully operational e-business solution. For a fast response,
DareStep can tailor existing packages or analyze, identify, and design a fully
customized solution for the client.

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F. Extended Enterprise Applications (EEA) and Enterprise Resource

Planning (ERP) Services
Cap Gemini Ernst & Young U.S. LLC began work in 1998 to demonstrate that ERP systems
provide the foundation for the connected enterprise. It subsequently created EEA, Extended
Enterprise Applications, to take a leading position in serving clients' needs in the new Extended
Enterprise Market. Its global reach, breadth, and depth across multiple service lines provides it
with a significant advantage in this market. Overall, CGE&Y draws from personnel with expertise
in change management, training, project management, technology, B2B supply chain, customer
relationship management, marketplace exchanges, human capital management, business
intelligence, and support services.
Falling into this service offering, Cap Gemini Ernst & Young delivers Extended Enterprise
Applications (EEA) and Enterprise Resource Planning (ERP) services geared for business
growth. RGI notes that the Package-Based Solutions division of Cap Gemini America plays a
role in developing solutions for the ERP market. By combining the IT services of Cap Gemini with
the management consulting capabilities of Gemini Consulting, this unit provides packaged
solutions through alliances with companies such as SAP, Baan, and Oracle. For example, under
a contract with Bridgestone/Firestone, Cap Gemini helped to enhance the companies business
processes using SAP modules, including Financial Accounting and Controlling (FI/CO), Sales and
Distribution (SD), Materials Management (MM), Production Planning (PP), and planning engine
MIMI from Chesapeake Software.
Cap Gemini implements its Enterprise Effectiveness in three stages: diagnostic assessment,
design and development, and implementation and measurement. During the first two stages,
Cap Gemini emphasizes the quick wins. It then completes the diagnostic assessment stage in
three to six weeks and provides the client with a comprehensive analysis of the enterprise
environment. The design stage, lasting from four to eight weeks, selects key operational areas
for improvement and formulates a course of action. The length of the execution and
measurement stage varies, based on the scope of implementation, but the organization's IT
environment is aligned with the key business objectives and drivers.
Accelerated Delivery Centers -- Over the past several years, to meet client demand
for accelerated delivery of solutions, CGE&Y has specialized delivery centers to
provide the environment, tools, and technical specialists to accelerate decision
making and solution design, development, and deployment. It connected these
delivery centers globally via a telecommunications network to form an infrastructure
utilized across all of our service offerings. Its EEA/ERP service line uses the centers
to handle phases of its projects, including initial planning and business case
development through design, development, rollout, and running applications postimplementation.
Change Management -- Change management services, those dealing with the

human and organizational change associated with an EEA/ERP implementation, play
a role in the success of a project. CGE&Ys change management practice, which
supports its EEA/ERP solutions in addition to other solution areas, continues to
evolve its tools and techniques to address the continuously changing technologies
and complexities of ERP solutions. It offers three key components to its change
management practice: transformation management, learning solutions, and
organization alignment.

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Euro Conversion -- CGE&Y claims to be a recognized leader in the Euro conversion

market. Since the creation of the Economic and Monetary Union (EMU) offering in
1995, it has completed more than 800 projects and has built a range of services,
enabling it to become a leader in the EMU market. The company expects EMU to
increase price transparency, to transform pan-European procurement and market
strategies, to increase competition, and to centralize organizational structures.
CGE&Ys Euro transformation services include strategy, positioning, implementation,
IT methodology and tools, and program management.
Extended Enterprise Applications (EEA) -- In the customer-driven, connected

economy, CGE&Y sees a rise of Extended Enterprises, based on adaptive working
practices and adaptive IT infrastructures. Success in the global economy of the
future depends on the speed and effectiveness with which enterprises evolve to
capitalize on this new environment. The Cap Gemini Ernst & Young U.S. LLC
Extended Enterprise Applications (EEA) model gives enterprises a practical method
for beginning this transition process.
Extended Enterprise Effectiveness (E3) -- To help companies create an EEA

architecture, CGE&Y developed an approach called Extended Enterprise
Effectiveness (E3). E3 represents an evolution of its Enterprise Effectiveness (E2)
service, originally designed to enable clients to connect strategy with processes,
people, and technology. E2 also was developed to realize quick wins, develop
improvement portfolios supported by a sound business case, measure and track
benefits, and use business processes and ERP as a foundation for e-business
excellence. E3 builds on E2 to include extended collaboration with customers and
suppliers, applications architecture, and technical architecture.
Global and Regional ERP Implementation -- Having implemented complex software

solutions in 1,500 different situations, CGE&Y claims the breadth of experience to
implement an ERP system either on a regional basis or across the globe. It assists in
determining process, data, and solutions standards that can be implemented globally
to help achieve business objectives.
Knowledge Management -- DELIVER/KLM (Knowledge, Learning, and Methods) acts

as a knowledge integration system that links a repository of deliverables and work
products to its project methodologies and standard work plans. DELIVER/KLM also
has links to its repository of relevant training and business process knowledge.
Using context sensitive linking, DELIVER/KLM presents the best examples of
knowledge and learning objects in the context of the methodology. The K!portal
enables Internet access to its knowledge bases, regardless of technology platform.
In addition, its knowledge centers provide thought leadership, service offerings,
methods and tool development, and knowledge management that supports its
EEA/ERP service line.
Methodology -- CGE&Y based its ERP methodologies on the vendor-developed

methods for implementation. It also embeds its methods and approaches into the
vendor-provided framework to enrich the method. For example, it bases the CGE&Y
U.S. package implementation approaches on its demonstrated Package-Enabled
Reengineering (PER) method. This was developed to guide and manage projects
undertaking the reengineering of core processes within the framework of a package
implementation. Modifications have been made to ERP that incorporate additional
processes and approaches that play an integral role to each package.
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Outsourcing and Hosting -- The Group delivers a range of services, ranging from
strategy to outsourcing and hosting, that leverage the benefits of its clients' ERP
implementations. It also provides ongoing support for its clients business
requirements. CGE&Ys Operate offerings include Applications Management,
Infrastructure Management, and Application Service Provider Services. The Group
has found a growing demand for operate services as companies focus on core
competencies and deploy their critical resources on strategic, high-impact areas. At
the same time, these companies look for ways to reduce ERP implementation
lifecycle costs and maximize the value (business benefits) that ERP can deliver.
Package Evaluation, Selection, and Planning -- CGE&Y U.S. can help choose the
software package that best aligns the clients' e-business transformation with its
overall corporate strategies. Its industry experience, record of teaming, and
understanding of the clients' cultures and operational strategies accelerate the pace
of package selection.
Program Management -- CGE&Ys Project/Program Management Approach utilizes

experienced project management personnel, established program management
methodologies and standards, and tested tools and technologies to provide
oversight, coordination, and control of all interrelated project or program activities.
These program management features are leveraged to provide its clients with the
necessary management, infrastructure, and administrative support necessary to
make the initiative a success. Its approach facilitates effective project/program
management through the use of consistent and repeatable processes, program
standards, and leading practices relating to people, processes, and technology. This
Project/Program Management Approach supports the EEA/ERP service line by
providing the frameworks, methods, techniques, and tools necessary to manage an
implementation of large scope and complexity.
Risk Management -- CGE&Y says that Assessment, the Quality Advisor, and OTACE
(On Time and Above Client Expectations) provides the foundation for operationally
sound service delivery that results in reduced risk, increased quality, and ultimately,
client loyalty. This program, which applies to all of its EEA/ERP delivery
engagements, provides CGE&Y with ongoing views into the delivery of its work and
is part of the way in which the Group does business. Risk Assessment acts as a
technique to identify, evaluate, and manage the most serious risks encountered
during the pursuit and delivery of an engagement. At the beginning of each
engagement, the CGE&Y engagement director, using a checklist containing over 100
risk factors, conducts a risk assessment. It then categorizes the risk factors by five
processes: sales, service, people, knowledge, and client. It receives a risk rating of
high, medium, or low. Those risk factors that are rated high require a risk mitigation
strategy and are documented in the action plan. These action plan items are then
incorporated into the overall engagement work plan. The process ratings, together
with the overall ratings, define the risk profile for that statement of work. Ultimately, it
uses the risk assessment to develop a preemptive risk management strategy.
Eliminating them altogether or reducing them to an acceptable level manages the
most serious risks.
Upgrades -- Release upgrade strategies have been devised by software suppliers to

provide their customers with new functionality, fixes to known bugs, and
improvements to already existing functional and technical transaction frameworks.
The rollout of a new release often brings shifts in a software supplier's support
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strategy for releases in production with their customers. As older releases near the
end of productive support by the software supplier, companies find it difficult to justify
the software release upgrade as a strategic initiative project. Without clearly stated
business objectives, it becomes impossible to identify how an upgrade project
integrates into strategic initiatives. As a result, upgrade projects generally are
considered to be an expense rather than an investment. The Upgrade for Success
program was designed to enable clients to get the most out of new ERP software
releases. It helps them achieve the technical and business aspects of an upgrade or
migration.
G. MCommerce
Cap Gemini Ernst & Youngs MCommerce offering covers solutions geared for mobile
commerce over the Internet. As the use of mobile telephony grows worldwide, it says that 80% of
the millions of devices in use will be WAP-enabled by 2002. With improvements in compression,
greater available bandwidth, and the launch of more powerful and intelligent devices,
MCommerce will provide e-mail on portable phones, disseminate information, and perform
complex transactions. Its MCommerce offering includes the following.
Business Portals -- It provides design, build, and implementation services for

advanced business portals, with a focus on finance, travel, retail, and employee
centered systems;
Business Applications -- CGE&Y creates, tests, and implements a range of mobile

applications, including supply chain, telemetry, fleet management, job dispatch, and
all aspects of CRM;
Residential Applications -- The company works with others to create and test
applications for home use. It currently tends to focus on mobile banking and
brokering, payment, shopping, and advertising;
Mobile Marketplaces -- CGE&Y has been developing new services for mobile
marketplaces, working with a global partner that represents one of the largest mobile
service provider;
Telco Solutions -- In the field of telecommunications technology and applications,

CGE&Y builds a range of services for its global partners that include some of the
largest telecommunications providers; and
Synergies with Other Service Offerings -- MCommerce not only acts as a stand-alone
capability, but also operates in the context of e-CRM, supply chain, and ERP
offerings.
Addressing this market, CGE&Y claims a global network of wireless centers of excellence,
equipped with technology from providers of wireless components. In general, its set of mobile
services includes mobile architecture definition, mobile infrastructure launch, mobile solution pilot,
mobile solution launch, and mobile enterprise strategy and transformation. In addition, the
companys wireless professionals have experience with the leading technology in this arena, such
as WAP, Bluetooth, 802.11/802.11b, and Satellite.
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H. Strategy and Transformation

CGE&Ys Strategy and Transformation practice looks to help its clients remain or become the
preeminent value creators in their industries. The Group works with its clients to develop and
implement strategies for growth and competitive advantage. It can help companies sketch out
scenarios and strategic options, visualize desirable outcomes three to five years from now, and
develop new business models. Through the Center for Business Innovation, its Center for
Enterprise Creation, and the Groups continuing "Enterprise of the Future" research, the company
has extended its perspective and is generating new insights into the future. Key service offerings
include the following:
Alliances and Mergers -- Pre-deal assistance, including developing and testing

rationale for deals, defining roadmaps, and creating success measures. Post-deal
assistance, including developing and implementing actions to ensure value creation
and capture.
Enterprise of the Future -- Developing a vision of the enterprise in five years time,
defining which portfolio of initiatives will be most effective in creating and capturing
customer and shareholder value.
Competitive Strategy -- Aligning enterprise/business unit visions with market

opportunities, designing and implementing strategies to optimize business
performance and achieve advantage.
Innovation and Growth -- Generating new ideas, defining growth platforms and
business models, and launching growth initiatives, including its GrowthWorks
methodology.
New Business Creation -- Incubating and scaling new businesses.
Collaborative Product/Service Development -- Designing collaborative new product

and service development processes based on emerging technologies, to reduce
costs and accelerate time-to-market.
Next-Generation E-Business -- Rationalizing the portfolio of e-business strategies

and initiatives, ensuring that efforts remain consistent with overall business strategy
and reflect a state-of-the-art view of technology.
Business Redesign/Transformation -- Designing and launching strategic

transformation programs to adapt the business to the new competitive environment,
and implementing the client's competitive strategy.
I. Support Services

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With a decade of experience helping companies redefine and optimize support functions,
CGE&Y helps clients streamline operations and drive performance in finance, accounting, human
resources, knowledge management, and IT. Ranging from simple strategic planning to ERP
optimization, it practices a comprehensive approach to transform an internal infrastructure and
enhance existing strong points within a clients organization.
I. 1. Finance Transformation and Performance Management
CGE&Y assists CFOs in aspects of financial transformation. This includes developing the
strategy, creating the business case, designing the operating model, creating the performance
management framework, providing the technical skills and environment, and rapidly implementing
the solutions. The following solutions help CFOs position the finance organization as a driver for
a companys growth and profitability:
Finance Transformation -- spans strategy development, process design and

optimization, ERP implementation, and Web-enabled solutions.
E-Finance -- transforms the finance function through Internet-based technologies. It

says that strategy, development, and implementation are expedited through the use
of industry specific CFO and CIO solution sets.
Performance and Cost Management -- analyzes costs and profitability. Development

and implementation of processes and tools link strategy to operational execution.
Shared Services -- designs and implements a shared services organization ranging

from developing the vision through post-implementation support. It also optimizes
shared services where an existing shared services organization exists.
Specialty Areas -- focuses on areas of expertise, including revenue cycle, treasury,

transfer pricing, and working capital management.
I. 2. Shared Services
It bases the CGE&Y Shared Services solution on global market leading experience,
designing and implementing shared service operations to decrease operating costs and improve
the overall quality of services. It covers the full lifecycle of shared services, from developing the
vision through post-implementation support. For clients with existing shared services operations,
Cap Gemini Ernst & Young optimizes performance by suggesting changes to the underlying
operating model, applying e-business technologies, or migrating from a regional to global Shared
Services model.
I. 3. Workforce Excellence

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Cap Gemini Ernst & Youngs Workforce Excellence services help clients build an
organizational architecture while developing workforce effectiveness. Services range from
implementing best practices and leading technology in Human Resources core processes to
dramatically lower costs while increasing speed, accuracy, and self-service:
High Performance HR -- spans strategy development, process design and

optimization, ERP implementation, and Web-enabled solutions.
Transformation Management -- promotes leadership effectiveness, change

management, communication, and culture alignment.
Organization Alignment -- includes structure and job alignment, competency

modeling, and talent investment optimization.
Learning Solutions -- assists in developing corporate learning and e-learning or

classroom-based instruction.
I. 4. Knowledge Communities and Portals
Cap Gemini Ernst & Young claims to have demonstrated world-class knowledge asset
management capabilities. This experience resulted in its Knowledge Communities and Portals
offerings. CGE&Y shifts toward collaborative work methods, helping optimize corporate
knowledge sharing to accelerate and improve customer service. Effective knowledge
management enhances the efficiency and effectiveness of individuals, teams, and the
organization as a whole and ultimately creates a significant competitive advantage.
The Knowledge Communities and Portals service offerings focus on helping organizations
understand business goals:
Intranet Effectiveness -- begins by looking at how, when, and why people in an

organization access an Intranet. It examines functionality, scalability, and ease of
use. It also provides a roadmap for leveraging and prioritizing a companys Intranet
investments. Beyond that, practices in content and community management are
integrated with an organization's specific need to establish an overall collaboration
model.
Knowledge Community Launch -- includes tools and a packaged approach that helps
companies form, organize, launch, and monitor pathfinder groups. The project
emphasizes both speed and learning and helps an organization rapidly expand
collaborative decision making across multiple areas.
Enterprise Community and Portal Design/Implementation -- helps re-create work

models to maximize collaborative impact, using CGE&Ys global experience.
Through this work, it creates an Intranet strategy with a rollout plan and priorities that
are then reflected in all aspects of delivery -- from portal design, to community
participation, to performance management structures. In addition to access, CGE&Y
establishes the underlying processes and tools needed to sustain enterprise-wide,
effective Intranet use and collaboration.

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Market Strategy
The Groups structure draws on the resources of Gemini Consulting, Cap Gemini IT Services,
and recently-formed Cap Gemini Ernst & Young U.S. LLC (formerly Ernst & Young Consulting
Services) to provide strategies and IT frameworks for management consulting, systems
transformation, and outsourcing. Analysts believe that Cap Gemini Ernst & Young U.S. now has
the resources of a global network with a significantly stronger U.S. presence, recognized alliance
partners, and greater industry knowledge. Many view the bottom line on the acquisition of Ernst
& Young Consulting as providing Cap Gemini with a greater breadth of offerings and expanded
geographical coverage. Whereas Ernst & Young Consulting's expertise has been weighted
toward strategy development and project management in North America, Cap Gemini's focus has
been systems and technology integration in Europe and the Asia/Pacific region.
Industries in which CGE&Y claims a vertical presence include the financial services,
telecommunications, consumer products and retail, manufacturing, life sciences, chemicals, and
energy and utilities markets.
Cap Gemini Ermst Young 1HFY00 Revenue by Global Markets
(Revenue = $3,956M)
Utilities
8%
Telecom & Media
16%
Life Sci. &
Healthcare
11%
Other
5%
Retail & Dist.

15%
Finance &
Insurance
18%
Manufacturing
20%
Admin. & Pub.

Service
7%
Source: Cap Gemini
A. Customers and Company Size

Cap Gemini Ernst & Young says that its client base touches nearly two-thirds of the Global
Fortune 500, with many of its clients based in the U.S. In fact, CGE&Y currently derives
approximately 35% of its revenue from North American operations, which contrasts to less than
15% before its Ernst & Young Consulting acquisition. Overall, revenue derived from the newly
formed Cap Gemini Ernst & Young U.S. brings broader industry experience to clients. This
includes in-depth, local expertise in financial services, telecommunications, retail, manufacturing,
life sciences, and utilities.

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Customer/Industry Characteristics
Customer/Industry
Customer/Industry Characteristics
Telecom & Media
Deregulation and technological

development
Group know-how in billing, Internet

services and customer loyalty
Increased client segmentation,

changes in regulations and tax laws
Introduction of management systems

adapted to insurance activities,
which promote responsiveness and
cost reduction.
Emergence of technology requiring

the management of masses of data
(study and genomes), corporate
mergers.
Introduction of integrated logistic

management and client
management systems.
Privatization and deregulation in

Europe and the U.S.
Development of a client
management procedure.
Insurance
Life Sciences
Utilities
Cap Gemini Offering
Source: Cap Gemini

The following chart provides a sampling of selected clients from each of these industries.
Selected Cap Gemini Ernst & Young Clients by Industry
One-2-One (mobile phones company)

California Public Utilities Comm.
(third-party to Pacific Bells Sec. 271)
Nextel
Portal Information Network
Belgacom France
FirstMark Communications
France
Telecom, Media & Networks

Warner Music
Arizona Corporation Comm. (thirdparty consultant to US Wests Sec.
271)
Warner Music International
British Telecom
Landtel N.V
Polygram in France
Vodaphone
Cellnet
Versatel (Netherlands)
Albacom (Italy)
GTE Data Services
BT Paging Service
Telia ProSoft
FirstMark Communications France
Telia Telecom
Life Sciences
Janssen Pharmaceutical Ltd.
(subsidiary of Johnson & Johnson)
Glaxo Wellcome
Pateur Merieux Connaught
(subsidiary of Rhone-Poulenc)
Hoffman La Roche
Monsanto
CP Kelco
Health
Mlnlycke Health Care

Sarasota Memorial Health Care
System
American Healthways
Manhattan's North General
Hospital
Insurance
Trigon Blue Cross Blue Shield
Royal & Sun Alliance

Chubb & Sun
Yorkshire Utilities
EDF-GDF
Sarasota Memorial Health Care
Maryland Casualty Company
Utilities (Energy, Water, and Environment)

Scottish Power
Elf Atochem
Vivendi Group
British Petroleum
Bruce Power (runs nuclear power

stations in Canada)
Hydro One
Aeroports de Paris
Virgin Trains Trainline
Continuum Health Partners
London Electricity
Ontario Power Generation
Travel & Transport
Transavia
Autokontroll
Toronto Hydro
Swedish Rail
London Borough of Brent (parking

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management)
Malaysia Airlines
Eurotunnel
Consumer Products Retail & Distribution
McDonalds
Gardenburger
Nedlloyd Unitrans
Proctor & Gamble
Danzas
Finance
Nordbanken in Sweeden
Credit Lyonnais
General Motors Acceptance
Credit Commercial de France
ABN Amro
Nasdaq Europe
Administration & Public Services
U.S. Chamber of Commerce
State of Wyoming
The United Way of America
Scottish Public Sector
Manufacturing (Process, Automotive and High Tech)
Bridgestone/Firestone
British Steel
Dresser-Rand Company
BT Industries (truck manufacturing)
Prosonic
CAT Group
Europecar
B. Account Marketing Approach

In general, Cap Gemini Ernst & Young utilizes a mix of designated sales personnel and
senior consultants who have responsibility for new sales. While contacts were unable to provide
information on the number of personnel dedicated solely to landing sales contracts, RGI believes
the firm weights the sales responsibility on senior consultants that may allocate as much as 20%
of their time to winning new accounts. This appears to be the traditional services sales model
that is typical of others in the consulting industry, such as KPMG and Deloitte & Touche.
Over the past year, the Group focused more heavily on building its Global Sector Unit sales
along five industry sectors. In addition, its Telecom Media and Networks units have responsibility
for sale and delivery on a global and regional basis. The Group states that those fulfilling account
executives roles not only have responsibility for landing accounts, but also the entire followthrough process, including the sell and delivery side. The Group says that its sales can be looked
at from a global prospective. Its overall global sectors have responsibility for high-end marketing
and knowledge-related activities that trickle down to the local level through its geographic
presence in eight regions. In this way, the Group can understand the global and local markets
and address each respectively.
According to conversations with Cap Gemini Ernst & Young contacts, the Group has merged
its operations on the account level, with some estimating a 50% overlap between the Cap Gemini
and Ernst & Young client base. For example, all global accounts include members of both Cap
Gemini as well as Ernst & Young. Overall, Cap Gemini Ernst & Young has global, multi-national
and regional accounts. It goes on to structure account teams by industry, region, and service
line. Towards the latter half of CY01, CGE&Y purportedly had just fewer than 100 global clients
generating an estimated 20% of its revenue. In fact, since the purchase of Ernst & Young
Consulting Services, the Group aligned its five Global Sectors so that each targeted 20 global
accounts in an effort to quickly gain market share.
Looking to attract new clients, Cap Gemini Ernst & Young takes a somewhat different
approach compared to other consulting firms. In general, the Group appears to be moving away
from the traditional transactional model where the consultancy is hired to do a project and moves
on. CGE&Y hopes to build long-term relationships with major clients that will enable it to address
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different client needs over an extended period. The Group says that it also looks to build its
cross-over sales. For example, the Group looks to sell its AM services to accounts that have
already purchased its consulting services. In addition, it may look to market CRM solutions into
an AM contract. Cap Gemini Ernst & Young also views its alliances with solution partners as
sales channels. It not only has a relatively generic relationship with Microsoft and Oracle, but
also has alliances with the likes of Siebel and SAP. Under its relationship with SAP, for example,
CGE&Y says that it can better target markets such as retail.
RGI notes that following the operational merge of Cap Gemini and Ernst & Young Consulting,
the Group launched initiatives designed to attract potential employees. In particular, it allocated
staff among six professions, corresponding to groups of business. The Group looks to encourage
the emergence of local and international professional communities to promote the development
and sharing of methodologies specific to various businesses. CGE&Y goes on to say that the
creation of these professions offers a career framework for all employees. This allows the Group
to assign professional client engagements with a high level of competency in specific areas,
whatever the country, industry, or service line. The six professions include the following:
Strategy Consulting;
Enterprise Solution Consulting;
Technology Consulting;
Operations;
Business Development; and
Enable.
C. Pricing
Despite the changes due to the integration of the Ernst & Young Consulting unit, its pricing
does not appear to have deviated from its time-and-materials or project-based fixed-fee models.
RGI notes that this could change as the new company gets a feel for what it takes to operate an
organization that has doubled in size. However, CGE&Ys management believes in the
importance of keeping pricing consistent, since clients are not likely to accept higher costs just
because the name of their service provider has changed.
Even if prices stay the same, the firm expects increases in revenue for Cap Gemini Ernst &
Young from the cross-selling of services. This means that former Ernst & Young Consulting
clients may expect to be offered Cap Gemini call center hosting services. In a similar fashion,
existing Cap Gemini clients will be offered Ernst & Young's project management and strategy
services.
D. Advertising Strategy
According to industry sources, Cap Gemini Ernst & Young is in the early stages of an agency
review for its U.S. creative and media-related activities that sources value at roughly $20M per
year. In fact, its latest advertising campaign came during the latter half of CY00, after its
acquisition of Ernst & Youngs consulting business. The company said that the campaign was an
effort to capture visually Cap Gemini Ernst & Youngs essential brand equity of entrepreneurial
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creativity. It demonstrates that Cap Gemini Ernst & Young has successfully distilled the brand
essence of the newly merged company. The campaign is a celebration of having defined the
global offer that distinguishes Cap Gemini Ernst & Young from its competitors. It also marks a
new phase for Cap Gemini Ernst & Young as it continues its global expansion.
In reference to the $30M campaign developed by DArcy Masius Benton & Bowles, Patrick
Boccard, Director of Corporate Communication for Cap Gemini Ernst & Young, stated the
following: We are particularly proud to have achieved the complete cycle of brand definition,
advertising agency search, and launch of the advertising campaign in just five months.
Creative execution shows solutions that come from innovative thinking. The images include
a footprint on the moon, a babys pacifier, and a light bulb. Incorporated into each image is Cap
Gemini Ernst & Youngs icon, which has been part of Cap Gemini Ernst & Youngs corporate
identity since the companys inception in 1967. Mr. Boccard went on to say, Cap Gemini Ernst &
Young is the only major consultancy with a logo as part of its graphic identity. We decided to use
the logo as a central creative element to symbolize our commitment to entrepreneurial creativity
and business innovation.
RGI also notes it was named as one of the premier brands in a recent book on Business
Superbrands in which Chairperson, Marcel Knobil, stated the following. "It is no accident that by
far the majority of these brands have been built upon a high quality product or service, lived up to
their promises, stood for something distinctive, generated considerable awareness, defined a
clear personality, and consistently remained faithful to their brand principles."
Advertising will run in print media in 15 countries (Europe, North America, and Asia) between
October and December, with strong visibility in transregional media, national dailies, weeklies,
monthlies, and trade press, as well as in airports with billboards.
E. Competition
Cap Gemini Ernst & Young ranks itself against other global IT Services and Consulting firms,
such as IBM Global Services, EDS, and Andersen Consulting, now known as Accenture. Others
include Computer Sciences Corporation, PricewaterhouseCoopers, and KPMG. It also competes
with the likes of Hewlett-Packard and Compaq. In addition to traditional management consulting
services, all of these competitors offer IT services such as outsourcing, Enterprise Resource
Management, and Customer Resource Management services. RGI notes the following ranging
provided by the Group for 2000.
World IT Services and Consulting Companies
(Fiscal year revenue; outsourcing excluded; $B)
Firm
IBM Global Services
EDS
Andersen Consulting (Accenture)
CSC
WW FY00
Revenue
$27.3
$19.2
$10.5
$10.3
US FY00
Revenue
$11.5
$11.2
$6.8
$5.2

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Cap Gemini Ernst & Young
$7.9
$2.7

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Organization Structure
Since its Ernst & Young Consulting Services acquisition in 2000, Cap Gemini Ernst & Young
made several key management changes, largely due to its lagging revenue. Initially touted as
one of the largest transnational mergers of the year, CGE&Ys profits likely will fall by more than
half over the calendar year on sales of roughly $8B. Making attempts to streamline its operations
to again realize revenue growth, the Group not only named its Chief Operating Officer, Paul
Hermelin, as its new Chief Executive Officer, replacing Geoff Unwin, but also implemented a
restructuring plan. As late as December 2001, it disclosed a full year $180M restructuring charge
to cover a new round of layoffs and cost savings measures. To date, it has decreased its 60,000
workforce by an estimated 9%. The restructuring also includes the postponement or staggered
implementation of certain initiatives that no longer represent priorities, better management of
SG&A and travel expenses, as well as the closure of a few minor operations in Croatia and
Slovakia.
In addition to the appointment of its new CEO, the Group made changes to its Americas
operations. In particular, CGE&Y named former VP and Leader of Health/Managed Care, Paul
Ruflin, as its Chief Operating Officer. He holds responsibility for all of the CGE&Y industry
operations in the Americas. In turn, the Group named Lewis Redd as its National Practice Leader
for CGE&Y Health, a position overseeing all business development and service delivery among
U.S.-based clients. Other senior executives in the new CGE&Y Health practice include Russ
Rudish who leads the Health Providers practice, Sean Kenny who leads the Managed Care
practice, and Ken Katif who leads the Life Sciences practice. In addition, David Zito oversees the
solutions teams involved in strategy, transformation, and information technology. Also during
November 2001, Cap Gemini Ernst & Young announced the appointment of John Parkinson as
Chief Technologist for the Americas. As an additional note, toward the beginning of CY01,
CGE&Y named Florence Mairal as Communications Director, replacing Patrick Boccard.
A. Top Level Management

The Cap Gemini Ernst & Young organization does not lend itself to strict organizational
groupings, due to its matrix nature. In general, the Group is led by a seven-member
management committee, which consists of three Managing Directors and four Group Vice
Presidents. In addition, looking at its U.S. management organization, Terry Ozan leads the region
as CEO and Paul Ruflin holds the position of Chief Operating Officer. The company also lists a
number of vice presidents, each leading an Americas industry sector such as energy and utilities
or financial services.
A. 1. Group Management Committee
Managing Directors
Paul Hermelin, Chief Executive Officer and Chief Operating Officer -- Regions
Terrence Ozan -- North America

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Pierre Hessler -- Capabilities
Group Vice Presidents
Berend Brix -- Sectors

Hubert Giraud -- Risk Manager
Mark Hauser -- Offerings and Marketing
Frdric Lemoine -- Chief Financial Officer
Board of Directors
Serge Kampf --Chairman

Christian Blanc, Paul Hermelin, Pierre Hessler, Michel Jalabert, Ruud van Ommeren,
Terrence Ozan, Bruno Roger, Ernest-Antoine Sellire, Guy de Wouters , and Vice
Chairman, Geoff Unwin, -- Directors
Phil Laskawy and Chris Van Breugel Nonvoting members
North American Management
Terry Ozan -- Group Managing Director for the Americas

Paul Ruflin -- Chief Operating Officer
John Parkinson -- Chief Technologist
Lanny Cohen -- VP, Strategy and Technology Service Lines
Stephen Deedy -- VP and Leader of Consumer Products, Retail and Distribution
Timothy Crichfield -- VP and Leader of Energy and Utilities
William Hartman -- VP and Leader of Manufacturing
Kenneth Katzif -- VP and Leader of Life Sciences and Chemicals
Michael Rice -- VP and Leader of the Financial Services Industries
Lewis Redd -- VP and Leader of Health/Managed Care
Ravi Ravikumar -- VP and Leader of High Technology
Leslie Blair -- VP and Leader of Critical Technologies
John Distefano -- VP and Leader of MobileCommerce
B. Field Presence and Headcount

As of mid-year 2001, Cap Gemini Ernst & Young had more than 60,000 employees in
approximately 30 countries. It is estimated that 11,450 were located in nearly 80 locations across
the U.S. Based on estimations made by the firm, the vast majority, or just over 85% of its
workforce, are professional staff personnel. RGI categorizes these as consultants and engineers.
Given the worldwide workforce figure of 60,000, RGI believes that Cap Gemini Ernst & Young
had approximately 51,000 consultants and engineers in service related offerings, including
management consulting and IT services. With headquarters in Paris, France, Cap Gemini Ernst
& Young operates in the following countries.
Cap Gemini Ernst & Young International Presence
Australia
Austria
India
Ireland
Portugal
Romania

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Belgium
Canada
China
Denmark
Finland
France
Germany
Hong Kong
Hungary
Italy
Japan
Korea
Latvia
Luxembourg
Malaysia
New Zealand
Norway
Poland
Russian Federation
Singapore
Spain
Sweden
Switzerland
Taiwan
The Netherlands
United Kingdom

RGI notes that over the past few months, the Group announced a workforce reduction that
company officials claim has reduced its total number of employees by fewer than 10%, or 4,500
from the beginning of CY01-January. This reduction would bring the number to approximately
56,000 as of December 2001. Given this information, RGI estimates the number of consultants
and engineers at 47,600. Providing further guidance on its reduction, the Group stated during
one phase of its reduction that of the 2,700 jobs cut, the majority occurred in the U.S., U.K., and
Nordic countries. Cuts also were made across the Groups telecommunications market unit. At
this time, the Group transferred roughly 700 support staff members to client facing positions,
following the rationalization of operating structures.
B. 1. Hiring and Compensation Practices
In the competitive landscape of management consulting, as well as IT consulting and

services, RGI believes that Cap Gemini must pay high salaries in order to compete for top level
talent. However, due to the current weakness in the IT market and announced restructuring
plans, the Group purportedly has considered ways of lowering wages for the top 10% earners.
Cap Gemini Ernst & Young also made changes to its hiring practices over the past year. More
specifically, to enable every member of CGE&Y to feel part of the group, it designated its
"professions" as follows: Strategic Consulting, Business Consulting, Technology, Operate,
Business Development, and the Enabling professions (e.g. Financial Management,
Communications etc.). It says that belonging to a profession gives its employees the opportunity
to network with the best talent from around the world, exchange the latest best practices, develop
new skills and capabilities, and work together. In general, the CGE&Y Group created six
professions to develop its human capital. The purpose was to grow professional communities in
which individual team members could feel at home and develop within a family of peers having
similar roles and interests.
Strategic Consulting -- Work with business leaders to develop innovative strategies

and re-create enterprises.
Business Consulting -- Ensure delivery of effective business processes and

applications solutions to business issues.
Technology -- Develop and deliver complex technical solutions to real business

issues.

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Operate -- Provide world-class outsourcing services.
Business Development -- Build account relationships and drive sales.
Enabling Professions -- Provide support to the people and the business.
B. 2. Cap Gemini University
The university that Cap Gemini established in 1991 provides internal training to Group
employees and represents one of the cornerstones of the Groups internationalization strategy.
By enabling employees from different countries to meet and get to know each other, the
university lays the foundation for cross-border exchanges. It promotes the creation of
cooperative networks that, in turn, help to leverage the Groups capabilities in a number of areas.
As stated by the Group during 1998, Cap Gemini University dispensed 20,000 man/days of
training. The Discovery program gives new recruits an overview of the Cap Gemini Ernst &
Young services, areas of competence, and the career opportunities offered by the organization.
The International Business School program offers high-potential management staff the
opportunity to develop key competencies. The Group also believes that innovation acts as a key
growth driver and a source of competitive advantage in the competitive environment in which it
operates. In order to leverage the innovation process, the Group has developed Internal
Knowledge Management tools to help stimulate creativity.
Cap Gemini Ernst & Young states that it offers employees an opportunity for a career -- not
just a job. A successful career not only benefits both the employee and the company, but such
success also depends on working together with initiative and effort. In support of this belief, Cap
Gemini formed its Career Program. It designed the Career Program to offer consultants a
framework for setting and attaining career objectives, while offering the very best service to the
Groups clients. The program offers consultants a variety of professional growth alternatives
within a framework that parallels market trends and client demands. Example of programs
Discovery Program -- Recent graduates who join Cap Gemini Ernst & Young can get
an opportunity to attend a Discovery session at the university. Here, they learn more
about the group's international dimension, experience at first hand working in
multicultural teams, and engage in role playing exercises that devise winning
proposals for international clients.
International Business School -- Developing its international leaders of the future is of

prime importance to Cap Gemini Ernst & Young. The CGE&Y International Business
School is a 9-month program for high performing individuals. Using a mixture of
classroom-based and project assignments, working with some of the leading
business schools like INSEAD and the London Business School, Cap Gemini Ernst &
Young created a program that both develops and stretches the participants.

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Alliances/Joint Ventures/Partnerships
Over the past year or so, Cap Gemini Ernst & Young made a number of alliances and joint
ventures designed to strengthen its services portfolio and extend its product reach. For example,
in November 2001, Nokia, CGE&Y U.S., and EYT (formerly Ernst & Young Technologies)
announced a teaming arrangement to provide a mobile business solution for enterprise
applications delivery. Together, they will help enable mobile workforces in North America to
complete sales transactions, field service requests, fulfill customer orders, and manage inventory
from remote locations. This announcement combines Nokias focus on wireless devices,
CGE&Ys global systems integration experience, and EYT's competencies in application
fulfillment and support, providing customers a one-stop shopping experience for their mobile
enterprise integration.
Microsoft -- In January 2001, CGE&Y introduced n-Portal, a knowledge

management solution based on Microsofts Solution for Intranets (MSI) that enables
knowledge sharing across corporate intranets. Using n-Portal, companies can
provide employees with rapid access to information through enhanced document
searching and management capabilities; improve corporate communication and
online training capabilities through streaming video; and enable Web-based team
collaboration on documents. CGE&Ys accelerated development process delivers
the customized n-Portal solution that helps companies lower costs and increase
productivity.
Stef-TFE -- During November 2001, Stef-TFE and CGE&Y France sealed a longterm partnership agreement to develop and market IT solutions currently grouped
under the name Agrostar Applications. To this end, CGE&Y France will make a
capital investment in Agrostar, the Stef-TFE unit specializing in IT systems, which
holds the marketing rights to the company's software products. By combining the
expertise of specialists in logistics and information systems, the aim is to strengthen
the range of services that both groups will be able to offer to their food-processing
and distribution customers. Within this context, Stef-TFE has engaged CGE&Y
France to integrate its information systems within a single IT architecture and to run
its existing and future systems as part of a ten-year outsourcing agreement.
webMethods -- During November 2001, webMethods, a provider of integration

software, and CGE&Y announced that the companies would collaborate to build,
market, and sell a solution for the financial services industry. The solution will
provide businesses with the technology and consulting services necessary to achieve
straight-through processing, addressing financial institutions need to move toward
T+1 settlement for both domestic and cross-border securities trading. Together,
CGE&Y and webMethods will provide a technology offering relevant for
broker/dealers, global custodians, and investment managers to achieve T+1
settlement for domestic and cross-border securities trades. The companies will
connect the applications and systems necessary for settling securities trades.
Siebel -- During October 2001, CGE&Y and Siebel announced a global alliance that
would strengthen and expand their program of jointly implementing innovative ebusiness solutions and developing next-generation CRM services for the worlds
leading companies. As a Global Strategic Partner to Siebel, CGE&Y will leverage its
global presence to deliver the full range of Siebel e-business applications, in addition
to a variety of point solutions or as part of enterprise-wide integrated solutions to
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transform a companys CRM effectiveness. A number of specific initiatives will be

driven from the program:
A global go-to-market initiative to offer best-of-class services for integration of

customer touchpoints, allowing clients in all industries to provide a single
customer experience across multiple channels.
The development of Siebel Centers of Excellence in EMEA and APAC.
A dedicated global network of application support centers supporting Siebel ebusiness applications, similar to the Applications Management Services Centers
(AMSCs) supporting Siebel e-business applications established by Cap Gemini
Ernst & Young in Bristol, U.K. and Frederikstad, Norway.
GE Cisco Industrial Networks -- During August 2001, CGE&Y U.S. and GE Cisco
Industrial Networks announce a North American alliance to deliver adaptive
manufacturing solutions to industrial companies worldwide. Bridging the system-wide
gap between manufacturing shop-floor operations and business Enterprise Resource
Planning (ERP) systems, this solution enables real-time visibility and decision making
by allowing companies to be better connected, more responsive, and better managed
across their business enterprise. Comprehensive and sustained implementation of
adaptive manufacturing can have an impact on corporate measures, such as
decreasing build-to-order lead time, increasing product yields, and improving
inventory turns.
SAP -- During August 2001, CGE&Y and SAP announced plans to work together on
a global program to revolutionize the automotive supply chain. The new proposed
alliance between the two global industry leaders will leverage each others strengths
and expertise in the automotive industry. The companies will address some of the
industrys most pressing challenges related to just-in-time delivery and the make-toorder process. The two companies will develop a solution that merges Cap Gemini
Ernst & Youngs Adaptive Automotive Enterprise Model with SAPs mySAP
Automotive solution. The Adaptive Automotive Enterprise Model (AAEM) provides a
vision of how an organization can sustain business success in this rapidly changing
environment and assemble the building blocks necessary to take the organization
from where it is now to this future goal.
EHPT -- In August 2001, CGE&Y and EHPT, a global supplier of software for
communications management, announced an agreement on a business support
platform, NextGen CRM, for next-generation service providers in the
telecommunications industry. NextGen CRM will be marketed and sold by the Nordic
team of Telecom Media Networks, an industry practice of the CGE&Y. It leverages
its global partnership agreement with EHPT to offer the EHPT portfolio of billing and
customer care products as the basis of the new platform. CGE&Y then will integrate
best-of-breed customer relationship management (CRM) products from other
suppliers according to specific customer needs.
Convergys -- During August 2001, Convergys, a provider of integrated billing and

customer care services, and Telecom Media Networks announced an alliance that
leverages Convergys' Geneva Active Revenue Management (ARM) software to focus
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on the billing needs of operators. The alliance has secured a major account with
leading broadband communication provider, FirstMark Comunicaciones Espaa, to
integrate Convergys' Geneva software and other systems to support the company's
operations in Spain. Cap Gemini Ernst & Young, which led the system integration of
the Geneva software in FirstMark Comunicaciones Espaa, worked on all phases of
the project - - from analysis to design, implementation, testing, and integration. This
work complemented Convergys' work on the scope analysis, installation of the
Geneva software, and product analysis for the Voice Service. This project team
enabled FirstMark Comunicaciones Espaa to have its billing system up and running
quickly and within budget, keeping it ahead of the competition.
VerticalNet -- In July 2001, VerticalNet and CGE&Y U.S. formed a strategic alliance
to help accelerate the adoption and integration of business-to-business technology
for industrial marketplaces in the U.S. As a preferred systems integrator, CGE&Y will
support VerticalNets implementation of software, tools, and technologies in the U.S.
Additionally, under the terms of the agreement, VerticalNet will utilize CGE&Ys
Advanced Development Center (ADC), leveraging its software development
capabilities to accelerate VerticalNets product lifecycle. VerticalNet will draw upon
CGE&Ys real-world expertise in planning, building, and managing e-business
software and systems with a goal of seamless integration of its software. These
solutions address the needs of both private and public marketplaces, as well as their
members and participants, by providing a bridge between these markets and their
users.
SAPMarkets -- During April 2001, CGE&Y and SAPMarkets announced the signing
of an agreement aimed at helping companies create comprehensive B2B exchange
solutions using the MarketSet solution. By signing the agreement with SAPMarkets,
CGE&Y joined the SAPMarkets Global Partner Program as a Most Valuable Partner.
As the first partner to be engaged at this elite level, CGE&Y will develop a dedicated
practice focused on the delivery of MarketSet-based solutions. As part of the
SAPMarkets Global Partner Program, CGY and SAPMarkets will engage in joint
marketing, business development, and solution delivery activities. In addition, two
SAPMarkets Centers of Excellence will be established in the U.S. and Europe to
focus on solution demonstrations, client awareness, and competency development.
PeopleSoft -- In June 2001, CGE&Y announced the extension of its offerings within
the PeopleSoft practice to provide business consulting and implementation services
for PeopleSoft 8 CRM. Lynn Anderson, leader of Cap Gemini Ernst & Young's
PeopleSoft practice, comments, We are seeing a lot of interest from our clients in
addressing their customer-facing processes, as demonstrated by their willingness to
engage in discussions regarding improving these processes using our CRM Index
diagnostic tool. The PeopleSoft CRM modules will enable both existing and new
PeopleSoft customers to realize benefits in this area. RGI notes that CGE&Ys CRM
Index provides an assessment of CRM capabilities in a format that allows easy
comparisons with other businesses.
TradeCard -- During May 2001, financial supply chain service provider, TradeCard,
and CGE&Y announced an agreement to deliver and integrate TradeCard's patented
financial supply chain services. This will help companies improve working capital and
business process efficiencies within their financial supply chains. The financial
supply chain comprises the business processes and data flows that buyers and
sellers use to manage and settle their trade transactions. According to a CGE&Y
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benchmarking study of 150 large companies, the firm believes that automation of the
financial supply chain with TradeCard's technology, along with targeted business
process realignments, could save companies 50 to 100 basis points of top-line
revenue. These savings result from improvements to working capital, risk
management, and business process costs, including the labor and fees related to
purchasing, invoicing, accounts receivable, accounts payable, treasury, and cash
management.
iPIN -- In March 2001, iPIN and CGE&Y announced a global alliance to provide
Internet payment solutions to multiple industries, including telecommunications and
financial service providers worldwide. iPIN and Telecom Media Networks will engage
in joint sales, marketing, systems integration, and consultation to further deploy
iPINs payment technology and expand its penetration of telcos, financial institutions,
merchants, and other partners. The iPIN and CGE&Y alliance will enable companies
to deploy payment solutions, such as wireless payments, eWallet solutions, and
stored value applications. Having already identified specific large-scale projects to
work on together, including a current initiative with France Telecom, this
announcement further enhances the relationship between the two groups.
Netonomy -- During March 2001, Netonomy, a provider of e-care and e-commerce

solutions for wireless communications service providers, and CGE&Ys Telecom
Media Networks signed a global partnership agreement. The partnership builds on
the informal working relationship already established by the two companies and
enables Telecom Media Networks to integrate the MyNetonomy application into its ecare and e-commerce solutions for telecommunications service providers. Netonomy
will work with Telecom Media Networks to establish best practice in delivering e-care
and e-commerce solutions, particularly in the 3G environment. Only the self-service
model can fulfill true 3G service. As the number of customer interactions increase,
the traditional customer service and support operations via the call center will be
prohibitively expensive and slow.
Blue Martini Software -- In February 2001, Blue Martini Software announced the
addition of CGE&Y to the Blue Martini Software Alliance Program at the highest,
strategic level. Under the alliance, CGE&Ys consumer goods, retail, and distribution
practice will be able to offer to companies around the world Blue Martini applications
for commerce, marketing, channels and service. Companies including Canadian
hard goods retailer, Canadian Tire Corporation, have already selected Blue Martini
applications together with CGE&Ys strategy, development, and implementation
services.
PeopleSoft -- During February 2001, PeopleSoft and CGE&Y teamed to introduce

HealtheValue, a package of healthcare specific applications designed to lower cost
and increase the speed of e-business for healthcare organizations across the
country. The PeopleSoft/Cap Gemini Ernst & Young agreement provides a package
of enhanced solutions designed to address specific challenges of healthcare
organizations that include human resources, benefits administration, payroll,
purchasing/receiving, inventory control, general ledger, and accounts payable.
PeopleSoft Consulting will join forces with CGE&Y to provide rapid implementation of
these applications by leveraging Cap Gemini Ernst & Youngs FastTrack
Methodology.

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Compaq -- In January 2001, Compaq and CGE&Y announced they signed a global
alliance agreement that draws on the strengths and capabilities of both companies to
provide best-in-class consulting and systems integration services worldwide. The
intent of this global agreement is to combine CGE&Y consulting services with
Compaqs IT Infrastructure and Global Services to provide integrated solutions to
enterprise customers. This move extends Compaq Global Services capabilities and
broadens CGE&Ys suite of technology-centered offerings. The alliance also
provides enterprise customers with a single source for integrated solutions across
multiple platforms. As part of the agreement, CGE&Y and Compaq will help
customers address business needs such as CRM, e-procurement, and technical
requirements such as bandwidth, scalability, next-generation networks, and security.
Xchange -- During January 2001, Xchange and CGE&Y U.S. announced an alliance
to provide businesses with total CRM solutions. These solutions help businesses
earn increased profits from their customer base so that communications are timely,
relevant, personalized, consistent, and delivered through the interaction channel
most preferred by the individual customer. Xchange has been designated a
Preferred Partner for Cap Gemini Ernst & Youngs CRM practice. Xchanges product
suite will form the core of CGE&Ys Real-Time Marketing eCRM solution offering.
Under this agreement, Cap Gemini Ernst & Young will train up to 150 of its
consultants to implement Xchanges industry-leading CRM software by the end of
2001, dedicate full-time salespeople to selling the solution, and co-market with
Xchange.
PTC -- In January 2001, CGE&Y and PTC announced an agreement to offer

manufacturers the ability to collaborate with key partners, suppliers, and customers
throughout phases of a product's lifecycle, including the design, prototype, and
review processes. The major industries targeted by this include aerospace and
defense, electronics, automotive, high technology, telecommunications, network
equipment, industrial equipment, and utilities. The fundamental business concept
behind CPC (Collaborative Product Commerce) is that innovation and new product
development is vital to profitable and sustainable growth for manufacturers.
Significant advantage can be achieved by creating better products in less time, at
lower cost, and with fewer defects than the competition. CPC acts as an architecture
to help manufacturers meet buyers increasing demand for custom-tailored products.
Through Internet-based collaboration, real-time communication occurs among
partners, suppliers, and customers involved in a product lifecycle.

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Financials
Since its acquisition of Ernst & Young Consulting Services during FY00, Cap Gemini Ernst &
Young has realized lower than expected financial results. Having first anticipated an FY01
revenue increase of 13% to $8.6B on a pro-forma basis, the Group now refuses to make a
prediction on its FY01 operations. More specifically, prior to the close of its 1HFY01, Cap Gemini
Ernst & Young revised downward its forecast for the first half and full year. It cited a slowdown in
customer purchasing, as well as delays and cancellations of orders. At this time, it revised its
earnings outlook to $8B. Providing further guidance, the Group went on to say that the slowdown
affected several of its core industries, such as Financial Services in the U.S. and Benelux
regions, the High Tech sector, and Manufacturing in the U.S. It also stated that the Telco industry
continued its downturn in all countries where it represents a notable part of the revenue for the
Group. CGE&Y goes on to say that the slowdown in activity during 2QFY01 led to a deterioration
of its utilization rates, which caused operating margins to fall around 6% for 1HFY01. This
compares to a FY00 pro forma operating margin of 10.5%. Attempting to take corrective
measures, CGE&Y announced a cost cutting plan estimated at $76M, which includes the
following.
A reduction in headcount of 2,700, mainly in the U.S., U.K., Nordic countries, and
across its Telco operations on a worldwide basis.
The transfer of 700 support staff to client facing roles, as a consequence of

operational structure simplifications.
The delay or phasing of a number of market development initiatives that appear as

non-priority in the current environment.
Significant reduction in general expenditure.
Shortly after its announced restructuring, the Group announced its 2Q results. Providing
another downward prospective on its business, it stated that in an economy that has already
experience a heavy slowdown, the affects of the September 11 attacks cost the Group significant
losses in revenue and bookings. In turn, this has pushed back by at least one or two quarters the
hope of recovery in growth and has resulted in another round of workforce reductions. During the
second half of the year, and based on information gathered from its clients in the 30 countries,
the Group now considers several hypotheses. These range from moderate growth continuation
(a scenario which underpinned the objectives announced in June 2001, but which it now
considers optimistic) to a reduction in the global volume of business activity that the persistence
of a general depressed climate would generate.
While awaiting better visibility on which of these hypotheses will turn out to be correct and
after a 3Q below its previous objectives, the Board of Directors outlined the following steps:
To indicate for the moment no new figure regarding the current fiscal year or the first
budget drafts being studied for 2002; and
To prepare or accelerate a certain number of measures of precaution (cost squeeze,

pruning of the operational structures, relocating certain production activities,
expansion of development centers). Implementation of these measures will enable
the Group to better weather the storm should a recession in Europe be confirmed
and to rapidly take advantage of the recovery when it happens.
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Overall, Cap Gemini Ernst and Young realized pro forma revenue and net income of $7.6B,
and $489M for FY00, which compares to $6.8B and $389M for FY99. This represents an
increase of 12% and 26%, respectively. Going forward, the Group has provided relatively
minimal information for 2HFY01, only posting top-line pro forma nine-month revenue of $5.7B and
now making no estimates for the fiscal year results. RGI notes that this marks a 4% increase
over the comparative quarters in FY00.
Cap Gemini Ernst & Young Pro Forma Revenue and Net Income
(FY-end December; $M)
$7,548
$8,000
$6,838
$7,000
$6,000
$5,000
$3,956
Revenue
$4,000
Net Income
$3,000
$2,000
$489
$389
$1,000
$99
$0
FY99
FY00
1HFY01
Note: Conversion 1 Euro = 0.8910 UDS.

RGI notes that during the completed fiscal year before the acquisition of Ernst & Young
Consulting Services, Cap Geminis FY99 revenue of $4.3B marks a 22% increase over the prior
years $3.5B. In addition, FY99s net income of $237M grew 41% from the $168M posted in
FY98. Cap Gemini Ernst & Young began including the Ernst & Young revenue during May 2000,
and during FY00, the Groups revenue grew 43% to $6.2B. The Group goes on to say that over
FY00, the pace of business growth increased as the year progressed. Revenue in 2H rose
15.3%, compared with a 5.5% increase in 1H, and the growth rate reached 22.4% in 4Q. It says
that the escalating momentum was in keeping with the overall market trend, but it reflects the
operational benefits of the merger of the Group with Ernst & Young consulting business. It also
found that revenue in the early part of the year had been impacted by a depressed demand in
2HFY99. At this time, clients devoted their attention to protecting their systems from the
millenium bug, and the markets still believed that the Web agencies might replace the traditional
IT services firms. Further into the year, clients gradually began launching large-scale projects,
although decision making processes significantly were longer than in the past. Many of these
projects included an initial strategic and management consulting phase. This resulted in pushing
back to the second half of the year the ramp up of its IT services on the projects and,
consequently, the generation of proportionately higher revenue. The Group also pointed out that
the negotiations leading up to the acquisition of Ernst & Young consulting business, followed by
its acquisition, adversely affected revenue for the year.

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Cap Gemini Ernst & Young Revenue and Net Income Before Acquisition
(FY-end December; $M)
$7,000
$6,176
$6,000
$5,000
$4,310
$3,956
$3,524
$4,000
Revenue
$2,741
Net Income
$3,000
$2,000
$1,000
$103
$237
$168
$384
$99
$0
FY97
FY98
FY99
FY00
1HFY01
Note 1: The above chart shows CGE&Y Consulting revenue from end of May 2000 forward.
Note 2: Conversion 1 Euro = 0.8910 UDS
A. Market Segmentation
Cap Gemini Ernst & Young targets five global sectors, including Consumer Products, Retail &
Distribution; High Tech & Automotive; Healthcare & Public Sector; Finance; Life Sciences and
Chemicals; and Energy & Utilities. In addition, it markets to the telecommunications market
through its Telecom, Media & Networks business unit in which Cisco holds an approximate 5%
share. Overall, the Telecom, Media & Networks and the Financial sectors hold the greatest
percentage of the Groups revenue with 18% and 19%, respectively. The Consumer Products,
Retail & Distribution, and Healthcare & Public Sectors each have a 14% share. In addition, its
High Tech & Automotive and Energy & Utilities markets tie for another 10% each. RGI notes that
Cap Gemini Ernst & Youngs Life Sciences & Healthcare global market held a 7% share of its
revenue for 1HFY01.
Cap Gemini Ernst & Young 1HFY01 Revenue by Global Markets
(Revenue = $3,956M)
Energy & Utilities

10%
Other
8%
Consumer
Products, Retail
& Distribution High Tech &
14%
Automotive
10%
Telecom & Media

18%
Life Sci. &
Healthcare
7%
Finance
19%
Healthcare &
Public Sector
14%

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A. 1. Service Line
The Group segments its revenue between its various services offered. For 1HFY01, its
Business Solution and Technology category held the highest percentage with 64%, followed by
Operate with 20%, and Strategy & Transformation with 16%. Further segmenting the Groups
Business Solution & Technology revenue, RGI estimates that Technology accounts for 45% of
the combined category. In turn, Business Solutions represents roughly 42%, and Technology
hold 22%.
Cap Gemini Ernst & Young Revenue by Line of Service
(1HFY01, N = $3,956M)
Strategy &
Trans.
16%
Operate
20%
Business
Solution &
Technolgy
64%
Source: Merrill Lynch Capital Markets
B. International Results
Cap Gemini Ernst & Young operates in over eight regions. The Group goes on to say that it
has a relatively balanced geographic presence, with 35% of revenue generated in the Americas
and just over 60% in Europe. The Groups six European regions comprise approximately 20
countries, and the expanding Asia-Pacific region extends from Korea to New Zealand. In all, Cap
Gemini Ernst & Young has a presence in roughly 30 countries.

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Cap Gemini Ernst & Young Pro Forma Revenue by Geographic Area
(1HFY01, N = $3,956M)
Central
Europe
7%
Asia Pacific
2%
Nordic
Countries
7%
Benelux
12%
France
16%
South
Europe
UK
5%
17%
N. America
34%

Cap Gemini Ernst & Young reports its profit and loss by region. On a regional basis, the
Group achieved its greatest gross margins in the Benelux region or 14%, followed by North
America with 7.5%. In general, Europe had gross margins of roughly 4% to 5%. RGI notes that
Asia/Pacific realized negative gross margins of -8% during 1HFY01.
Cap Gemini Ernst & Young Pro Forma Profit and Loss
(1HFY01-ending June; $3,956M)
North America
U.K./Ireland
Nordic
Benelux
Germany & Central Europe
France
South Europe
Asia/Pacific
Total
1HFY01
$1,358
$668
$271
$463
$258
$633
$213
$92
$3,956
Operating
Income
$102
$25
$7
$65
$11
$28
$10
- $7
$240
Operating
Margin
7.5%
3.7%
2.6%
14.0%
4.2%
4.4%
4.6%
-7.8%
6.1%
Note: Conversion 1 Euro = 0.8910 UDS
B. 1. Company Employees by Region
The following chart segments Cap Gemini Ernst & Youngs workforce by region. The
purchase of Ernst & Youngs consulting practice strengthened its presence throughout North
America, as well as in Germany, increasing its percentage of workers to 19% and 6%,
respectively. Before the acquisition, the Group had 9% of its total staff in North America and 3%
in Germany. Over the past year, however, overall percentages have remained relatively steady,
with the most notable change to its U.K. market. This percentage decreased from 17% in FY00
to 14% in 1HFY01.
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Cap Gemini Ernst & Young Regional Employment

FY99
Cap Gemini
North America
U.K. & Ireland
Nordic countries
Benelux
Germany and Central Europe
France
Southern Europe
Asia/Pacific
Total
3,626
8,217
4,368
7,635
1,146
11,315
2,917
402
39,626
%
9%
21%
11%
19%
3%
29%
7%
1%
100%
FY00
CGE&Y
11,428
9,779
4,877
9,549
3,279
13,334
5,291
2,012
59,549
%
19%
17%
8%
16%
6%
22%
9%
3%
100%
1HFY01
CGE&Y
11,458
8,712
5,194
9,808
3,411
13,908
5,718
2,045
60,254
%
19%
14%
9%
16%
6%
23%
10%
3%
100%

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Corporate Strengths and Weaknesses

For a summary of Cap Geminis strengths and weaknesses, please refer to the Executive
Summary section of this report.

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Industry Focus
CGE&Y targets its largest industries through Global Sector Units, including Consumer
Products, Retail and Distribution; Energy and Utilities; Financial Services; High Technology and
Automotive; and Life Sciences and Chemicals. In addition, during the latter half of CY00, Cap
Gemini Ernst & Young and Cisco Systems announced the formalization of their strategic alliance
with the launch of a global business unit. The global business unit (GBU), called Cap Gemini
Ernst & Young Telecom, Media & Networks, operates under the Cap Gemini Ernst & Young
brand. It provides strategic counsel and hands-on expertise to telecom, media, and networking
organizations worldwide. The GBU delivers solutions that enable service providers and
enterprise customers to offer more rapidly new services developed in conjunction with Cisco and
Cap Gemini Ernst & Young. These will include:
Implementation of e-commerce and supply chain integration applications;

Integration/migration of voice and data networks;
Delivery of new wireless applications, including broadband wireless and wireless
data;
Delivery of broadband services;
Implementation of unified messaging applications;
Implementation of integrated call center applications; and
Implementation of IP-based management systems.
The strategic alliance also resulted in the creation of eight research, development, and
innovation labs throughout the world. The labs, based in California, Boston, Dallas, London,
Paris, Munich, and Singapore, enable the GBU to maintain strict quality control standards on
behalf of its customers by testing system reliability before installation on client sites. Aside from
its efforts in the telecom sector, Cap Gemini Ernst & Young also signed an agreement with
Manugistics, the global provider of supply chain solutions for enterprises. The two companies
jointly will market e-business solutions for trading networks. Under this arrangement, the two
companies plan to target the consumer packaged goods and motor vehicles and parts industry
segments.
In recent months, CGE&Y furthered its healthcare consultancy by bringing together the
services that its Health practice offers to hospitals, managed care companies, insurers, and
pharmaceutical, biotechnology, and medical device companies. With this move, CGE&Y
combined its services geared for hospitals and managed care organizations with its life sciences
offering. Additionally, the companys emerging health technology initiatives will focus on
identifying new technology solutions to improve the connectivity, efficiency, and effectiveness of
healthcare. With projected FY01 revenue of nearly $615M, and an annual growth rate of about
25%, the new Health practice represents the largest single business sector within Cap Gemini
Ernst & Young U.S. LLC. It represents almost 10% of CGE&Ys total global revenue.
Cap Gemini Ernst & Young Revenue Percentage by Industry
(1HFY01)
Industry
Consumer Products, Retail & Distribution

Life Sciences & Chemicals
Energy & Utilities
Finance
14%
7%
10%
19%

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Telecom Media Networks

Other
Healthcare & Public Sector
High Tech & Automotive
18%
8%
14%
10%
A. Financial Services
With a worldwide team of experienced professionals, Cap Gemini Ernst & Young has
established a leadership position in financial services, and now counts 35 of the world's largest
financial institutions among its clients. The Global Financial Services sector represents
approximately 19% of the firm's revenue in FY00. To consolidate its leadership position in the
sector, CGE&Y has embarked on a multi-dimensional development effort, unifying its capabilities
and its go-to-market efforts across the traditional industry lines of banking, insurance, and
securities. At the same time, it is elevating its focus on client relationship management and
sector-specific offering development. Notable contracts during FY00 included an Internet portal
for three French banks: Credit Agricole, BNP Paribas, and Societe General. It also launched a
B2B digital marketplace called answork.
CGE&Y service offerings include:
B2B Marketplaces and Supply Chain Suite of Services
B2B Strategy assists individual companies or groups of companies in evaluating

strategic alternatives and developing ideas to launch new online businesses.
CGE&Y leads the ideation process by deploying the Accelerated Service
Environment (ASE), which enables diverse business organizations to develop initial
designs quickly in a neutral environment.
Business Creation includes consortium engineering, governance, and financing of a

B2B marketplace, evaluation and creation of business models, development of the
management team, and identification of key partnerships and business alliances.
Exchange Design covers industry-specific designs for marketplaces, such as

procurement, collaborative product development, supply chain collaboration, financial
settlement, content and community, order management, logistics, and other specialty
services.
Back-Office Design includes applications related to launching the business, such as

rapid ERP implementation, customer relationship management systems, operations,
marketing, and human resources.
Build includes the design of architecture and technology, identification of key

integration points, and the development of IT and network infrastructure, systems
integration, as well as validation and testing.

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Run provides customers with the option of outsourcing the day-to-day management
of the new business, including applications and infrastructure, without diverting
resources from core business operations.
Customer and Supplier Enablement recognizes that building a community requires

the readiness of all participants. This service assesses what must be done to align a
company's systems with those of its customers and suppliers.
Inter-Exchange Integration establishes the necessary strategy, processes, and

systems that enable a company to participate in multiple exchanges.
A. 2. Center for Enterprise Creation
Despite the Internet's growth, CGE&Y says that most e-companies will fail. CGE&Y
addresses this issue with the Center for Enterprise Creation. The center brings together an ecompany's founding innovation with the strategic, technical, human, operational, and financial
solution sets required to launch an e-company and build a foundation for scalable growth. Touted
as providing a comprehensive and fully integrated service, the Center for Enterprise Creation
focuses on the following areas:
Supporting the co-creation of "spin-offs", extensions of existing products/services,

and "spin-ins" (new business units);
Establishing customized, repeatable, and consistent methods, processes, contracts,

and funding vehicles for multiple/continuous new business creations; and
Providing a network of best-of-breed providers called the Value Web (legal, branding,
recruiting, hosting, and funding).
CGE&Y says that the center offers startups advantages over incubators and pure financial
investors. It not only acts as a global e-strategy consultancy and provides accelerated Web and
systems developer, but also offers branding, legal, marketing, executive recruiting, and
infrastructure services. Relationships with equity and debt investors help founders secure the
funding to support the new venture's development, launch, and maturation. In exchange for
these services, the Center receives cash and equity.
A. 3. Connected Financial Services
The Connected Financial Services team consists of professionals with expertise in e-banking,
e-brokerage, e-insurance, and B2B marketplaces and services. Linked to its Global Service
Lines and Financial Services Consulting, the team provides clients with an encompassing reach
and vision, as well as a complete problem-solving capability. Connected Financial Services has
refined and systemized the best practices of e-business. From this strategic base, it supports the
rapid development and deployment of successful business models as clients build, run, and
manage e-solutions. As clients design, build, run, and manage e-solutions, Connected Financial

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Services helps to empower global organizations to provide profitable financial services -- B2B and
B2C -- in the following broad categories:
E-create -- Rapidly design and build new e-ventures.
E-operate -- Operate and manage business processes and/or IT systems.
E-strategy -- Help define a company's e-future.
E-transform -- Adapt existing business and organize processes and systems to meet
requirements of the connected economy.
Several offerings follow.
E-focus acts as an accelerated program that takes three weeks, working in

collaboration with a companys IT department to review the portfolio of e-projects and
recommend priorities.
E-architecture scan represents an accelerated program that takes four to six weeks,
working in collaboration with a companys e-architects to find white spots in earchitecture and resolve them.
Financial Services Innovation Center is centered in Madrid with additional locations

around the world. At this location, Connected Financial Services works with
technologies vendors and clients to design and build new business models.
Connected Financial Services Workshop disseminates developments in finance,

business cases, and best practices, relevant technologies, and strategic options.
Connected Financial Services Accelerated Solutions Environment (ASE) represents

an acknowledged framework to accelerate the development of creative business
solutions.
Funds Supermarket works as a framework to help financial organizations plan and

execute an online distribution platform for mutual funds and related financial
products.
A. 4. Customer Relationship Management
Customer Relationship Management (CRM) maximizes the value of a company's customer

portfolio through more effective and efficient marketing, sales, and customer service. CGE&Y
helps its clients to be more accessible and be easier to do business with in their efforts to know,
target, sell to, and service their customers and prospects. Cap Gemini Ernst & Young offers endto-end strategy and connectivity solutions that enhance its clients' customer relationships and
fully integrate front- and back-office business operations. CGE&Y offers a variety of point
solutions and integrated solutions to capitalize on a corporations CRM requirements.

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Strategy Alignment -- This includes the development of a CRM roadmap and

business case to align CRM initiatives to overall corporate objectives through
customer experience mapping, business process modeling, and technology
application architecture. The CRM Index, an ongoing barometer of CRM capabilities
in the marketplace, plays a role in the strategy alignment assessment. Covering
CRM topics from strategy to implementation, it offers participants an array of
industry-specific and best-in-class comparisons.
Marketing Campaign Management This includes the management of all marketing

programs, such as promotional campaigns, and loyalty and retention programs.
These services also include real-time marketing solutions that integrate business
intelligence at the point of customer contact to deliver behavior-based offers.
Real-Time Marketing -- Integrates business intelligence at the point of customer

contact, using dynamic behavior-based offer creation and scripting linked to a realtime customer feedback loop. This offering was deisgned to link into the operational
framework (people, process, and technology) of Touchpoint Integration.
Touchpoint Integration -- A pre-developed architecture and process for integrating

across multiple customer touchpoints and the communication infrastructure
necessary to support efficient customer interaction. This solution incorporates
consulting, system integration, software, and hardware.
Customer Intelligence/Data Mining -- Customer Intelligence deals with aspects of

capturing, analyzing, and optimizing the knowledge related to customers. Customer
Intelligence techniques are based mainly on data warehousing, data mining, and
predictive modeling.
CRM Process Reengineering and Efficiency This services utilizes depth and
breadth of knowledge across all CRM business processes (marketing, sales, order
management, and service) to transform a client's current CRM landscape to a
leading practices organization, using various CRM tools and enablers.
Stand-Alone Web Services -- These services utilize marketing, sales, order

management, and service skills to manage content on the Web. Customers can
develop and build Web storefront capabilities.
Call/Contact Center Solutions -- These solutions help customers evolving traditional

call centers from a cost to a profit center. They include strategy, business process,
and technology services. The solutions provide the capability to manage customer
relationships through multi-channel/touchpoint customer interaction, while increasing
customer retention, acquisition, and value. Specific activities include contact center
reviews/audits, upgrading existing call centers, consolidations, and new builds.
Sales Force Automation/Effectiveness -- Enables selling capabilities, including

identification of cross-selling and up-selling opportunities, improved communication of
customer information across the organization, and the increased effectiveness of
sales organizations and efficiency of sales efforts across channels.
Price Optimization -- Integrates pricing into the Touchpoint integration operational

framework. It matches the right customer to the right product, with the right price in

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the Touchpoint channel of choice. It includes dynamic pricing, complex pricing

agreements, and contracts, as well as promotional pricing.
CRM for Exchanges -- Provides the addition of baseline CRM functionality for
exchanges and their constituents. It includes contract management repository,
contact management system (hook-up and sign-on), customer support (billing and
settlement), in bound/outbound email, common marketing repository (combination of
marketing, business intelligence, and content management), and internal and
external reporting.
A. 5. Euro
CGE&Y's Euro service offering supports the changes to the business and IT that are
necessary for the single currency. The Groups 800+ assignments, over 300 in financial services
since 1996, supported by a state-of-the-art methodology, have enabled it to assist at every stage
of a project. CGE&Y says that the combined business and technical experience has made it the
leader in Euro services. The Group also offers consultancy on the wider aspects of EMU. Issues
for 2001/2002 include health check, notes, and coins, a resolution of the complex logistics, as
well as strategic consulting and resourcing.
A. 6. Insurance Services
Cap Gemini Ernst & Young says that it focuses on the big issues facing the insurance
industry, with a team of consultants and industry experts assessing the major challenges facing
its clients. Currently, it is helping insurance clients to face such challenges as managing new
distribution channels, globalization, speed-to-market, customer service, and cost reduction. As
leading business and IT consultants to the insurance industry, it believes that it is well placed to
help clients build responsiveness into their systems, using Web-based technology and product
development capability.
A. 7. Outsourcing
The Financial Services sector offers an extensive portfolio of outsourcing services that
deliver results companies are seeking in terms of business focus, technology improvement, cost
management, and access to resources. The Group has developed an approach to outsourcing
service delivery and has refined over 30 years of applications services that combines best-inclass tools, industry-leading processes, and methodologies. The Group says that it has
international teams of specialists to help clients focus on the strategic imperatives that sharpen
their competitive edge. It goes on to say that its services are distinguished by several key
characteristics:
A global network of Applications Management Service Centers that deliver

economies of scale through industrialized processes and mutualized resources;

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A rigorous methodology that integrates the Carnegie Mellon Software Engineering

Institute Maturity Model (CMM) into its proprietary ISO-9001-compliant PERFORM
processes and leverages global best practices;
Measured delivery through customized, adaptive Service Level Agreements (SLAs),

based on its clients' specific and evolving requirements and priorities; and
Flexible delivery options that provide the "right" solution to meet specific business
need.
A. 8. Secure e.Payments
Cap Gemini Ernst and Young claims to have a strong track record in developing secure ecommerce solutions. Building on this experience, it partnered with Arcot Systems to offer a full
range of services for banks and merchants, implementing the new secure e.payment processes.
These services include:
Security, authentication, and enrollment strategy;

Solution design and integration; and
Hosted solutions for banks and merchants.
A. 9. Straight Through Processing
CGE&Y says that global Straight Through Processing (STP) will revolutionize the financial
services industry over the next five years. Financial firms must begin now to develop a long-term
vision to guide them through profound changes in the way they operate. Cap Gemini Ernst &
Young's STP services respond to each of the key challenges in volume growth, cost containment,
and risk reduction facing the securities and payments industries. The STP services address both
internal and external opportunities for companies to improve STP. The Group goes on to say that
its STP services help to lower transaction costs, shorten processing cycle times, and reduce risk
exposure by applying the appropriate combination of:
E-Strategy;
Strategic Blueprints;
Business Case Development;
IT and Operational Infrastructure Assessment;
Solution Selection;
Renovation Strategy;
Renovation and Platform Transition;
Application Build;
Infrastructure and Integration Planning;
System Integration and Development;
Systems Enhancement and Maintenance; and
FM and AM Legacy Systems Application Management.

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Its STP solutions also benefit from several technology providers whose technology
represents part of its area of expertise. These providers include: Axion4, Dovetail, Financial
Systems Architects, Heliograph, Mercator, Omgeo, Securities Industry News, SeeBeyond, STP
Magazine, Sungard, S.W.I.F.T., and Trace Financial.
A. 10. Trading and Risk Management
Cap Gemini Ernst & Young's Trading and Risk Management Group focuses on the evaluation
and implementation of capital markets and risk management infrastructures. The Group helps
many financial institutions and corporate clients to:
Manage risk;
Measure performance;
Optimize the allocation of capital; and
Identify and control exposures.
Specific topics within Trading and Risk Management include:
Managing Uncertainty in Capital Markets;

Treasury and Risk Advisory;
E-Commerce in Treasury;
Enterprise-Wide Risk Management;
Investment Operations Review;
Commodity Trading;
Asset and Fund Management;
Technology Package Selection;
Technology Implementation; and
Operational Risk Management.
CGE&Y delivers its Risk Management Global Services thought the Risk Management Group
(RMG), part of an international network of practitioners with key centers in New York, London,
Amsterdam, Paris, Singapore, Tokyo, Sweden, and Toronto. Its professionals continually monitor
the latest academic and applied innovations in the risk management industry and are called on to
present the latest developments and leading practices at industry conferences. The RMG
focuses on the quantification and evaluation of risk arising from business strategy (strategic risk),
capital markets transactions (market risk), lending activities (credit risk), and overall operations
(operational risk).
A. 11. Wealth Management
CGE&Y says that wealth management represents the most profitable and fastest growing
segment of the financial services industry. It includes asset managers and private banking
institutions in the banking, capital markets, and insurance sectors. The Group goes on to say that
wealth management is facing exciting challenges, such as globalization, consolidation, new
competitors, and differentiation. Cap Gemini Ernst & Young acts as an acknowledged leader in

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this market, with a global network of 200 dedicated wealth management professionals residing in
all the major global money centers. Services falling under this category include the following:
Customer Relationship Management;

Fund Supermarkets and Wealth Portals;
Hedge Funds;
Straight Through Processing and Trade Date +1;
Strategy; and
System Selection and Implementation.
B. Health
Over the past five years, Cap Gemini Ernst & Young Health has served over 1,000 different
health organizations. This includes some of the largest hospital and health systems in the
country, major managed care companies, physician groups, and health technology companies.
The Group claims a client roster that includes 13 of the top 15 global pharmaceutical companies,
nine of the top 20 medical device companies, and five of the top biotech companies. In recent
months, it appointed Lewis Redd as National Practice Leader for CGE&Y Health. He is
responsible for all business development and service delivery among U.S.-based clients. Mr.
Redd noted that the firm has considered for some time the increasing interdependency of its
health clients in diverse segments of the industry. New pressures are being placed on the health
industry -- there is an expectation to deliver public health preparedness assistance and therapies
across the entire spectrum of the health industry, while improving patient care at an economically
efficient level. This new environment positions CGE&Y Health as the only company whose
services extend from the earliest stages of research and development through the ultimate
delivery and management of patient care.
CGE&Y's integrated health market practice positions the Group to provide comprehensive
services and solutions for providers and health systems, managed care organizations, and
emerging healthcare technology companies. It claims a goal of helping clients to increase market
share, improve operational efficiencies, and enhance customer service. In addition, its
knowledge in areas such as HIPAA and e-health/Information Technology helping organizations
addresses current changes in the industry. In doing so, it provides the following health-related
solutions.
Provider and Health Systems Solutions -- Company Transformation, Customer

Relationship Management, Information Technology, Operations, Supply Chain
Management, Support Services, HIPAA Solutions;
Managed Care Services -- Startup, Planning, and Development; Delivery System

Development and Management; Medical Management; General Management and
Administration; Core Administrative Processing; Information Technology; Sales and
Marketing; and HIPAA Solutions; and
Emerging Health Care Technology Companies -- Strategy, Technology Development,

System Integration and Deployment, Infrastructure Development, Post Merger
Integration, HIPAA, and Supply Chain.
RGI notes that during November 2001, PeopleSoft announced that Sarasota Memorial Health
Care System selected HealtheValue, an enterprise solution combining software and services,
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from PeopleSoft and Cap Gemini Ernst & Young. Designed for the health care industry,
HealtheValue includes Internet applications for materials management, financial management,
and human resources (HR) management, as well as consulting, training, and implementation
services. The HealtheValue solution will enable Sarasota Memorial to eliminate manually
intensive administrative HR tasks, shorten monthly close activities in accounting, and reduce the
costs of the procure-to-pay process.
C. High Growth
Cap Gemini Ernst & Young U.S. LLC's (CGE&Y) approach to helping high growth companies
has been created expressly to help these organizations sustain their business models and to use
growth as an effective competitive strategy. Its services include:
Critical Technologies -- The Groups High Growth Critical Technologies service line
claims a dedication to designing, developing, integrating, and implementing missioncritical information technology solutions for the connected economy. High growth
companies benefit from a skilled pool of CGE&Y consultants, pre-configured
components and learning tools, methodologies and in-house development
capabilities, and infrastructure.
Customer Relationship Management (CRM) -- Customer Relationship Management

(CRM) powers growth through improved customer acquisition and retention, as well
as the expansion of a company's customer relationships. CGE&Y's High Growth
CRM practice helps clients drive growth through sales force effectiveness, contact
center optimization, marketing maximization, customer analytics, and customerfacing e-business. CGE&Y's CRM point-of-view is the result of its combined years of
research and fieldwork, making the Group one of the top CRM system integrators.
Engineering, Construction, and Real Estate -- The Engineering, Construction, and

Real Estate (ECRE) practice provides professional consulting services to the
construction, engineering, real estate development, property management, and asset
management industries. The ECRE practice specializes in technology issues
affecting these industries. It focuses on providing technology strategy, technologyenabled process improvement, software selection, systems implementation, and
integration for high growth companies. The ECRE practice maintains an active
presence in North America and works with leading industry technology providers to
define the technology future for real estate.
Extended Enterprise Applications/Enterprise Resource Planning (EEA/ERP) -CGE&Y's rapid implementation approaches for EEA/ERP enable high growth
companies to establish the foundation systems required to connect with customers,
suppliers, employees, shareholders, and other stakeholders. CGE&Ys ERP/EEA
solutions go beyond implementation and integration, with outsourcing services,
upgrade, training, and migration support services. Its experience includes Oracle,
PeopleSoft, SAP, and JD Edwards.
Strategy and Transformation -- CGE&Y's High Growth Strategy and Transformation

service line helps companies develop business and technology strategies and
transformation programs to gain and sustain a competitive advantage in a connected
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economy. Its approach to strategy and transformation focuses on the creation of

growth strategies and transformation initiatives to reduce business costs. Proprietary
accelerators used to help its customers achieve rapid results include the Groups
Accelerated Solution Environment (ASE) DesignShops and the Center for Business
Knowledge (CBK).
Supply Chain -- CGE&Y's High Growth Supply Chain service line helps companies
optimize the management of their materials, information, cash, and work flows from
the company's suppliers to the end customer, in order to gain and sustain competitive
advantage. Its approach to effective supply chain management allows companies to
become more responsive to new business issues by increasing speed, flexibility, and
revenue growth, and dramatically reduce operating costs. CGE&Y provides
comprehensive supply chain management advice and support through a broad range
of industry experience, business and functional solutions, technology, and
implementation expertise.
D. High Tech
As it relates to the High Tech sector, CGE&Y offers various solution areas, each focused on
a key business issue, expediting CGE&Ys delivery of value to technology companies. It
designed these solutions to create continuous and sustainable business improvements. RGI
notes that the Group supports each solution area with a dedicated team of technology specialists.
D. 1. Customer Relationship Management
CGE&Y says that as the channels connecting companies and their customers multiply,
technology firms confront new challenges and opportunities in identifying, acquiring, and
sustaining profitable customer relationships. Its Customer Relationship Management practice is
devoted to maximizing the value of a customer portfolio by carrying out the following:
Determining which customers a client should target for acquisition, development, and
retention;
Generating, managing, and deploying customer knowledge to increase revenue and

reduce churn; and
Making effective use of customer-connecting technologies.
Overall, its CRM services cover five key areas:
Customer relationship strategy;
Management of customer access, both direct and indirect, to product information and
company processes;
Customer care and billing systems, from order management to cash collections;
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Call center strategies, with a focus on their efficient and profitable use; and
Knowledge management strategies and systems that mine customer information to

grow revenue and maintain a profitable customer portfolio.
D. 2. New Product Development
CGE&Y looks to develop new products, tailoring them to customer needs on a mass basis.
In turn, it develops product strategy and assists with product and service development, launch,
and support. CGE&Y designed its solutions to reduce time-to-market with a range of services.
These include:
Advanced Development -- R&D processes that deliver new technologies, processes,

and data;
Product Planning -- Idea generation and product portfolio management;
Program Execution -- Design of products and services and preparation for production
and launch; and
Post-Launch Support -- Maintaining use of the product, including developing

enhancements to extend its useful life.
D. 3. Support/Shared Services
CGE&Y guides companies through the process of defining and executing strategies to
achieve cost and performance goals. This is done through shared services, which include the
consolidation of functions to leverage economies of scale while improving service quality. Its
services solutions range from a cost/benefit analysis of outsourcing non-core functions to the
impact of service rates on customer responsiveness.
D. 4. Merger Integration
CGE&Y helps companies increase their rate of success in this highly specialized area by
providing services that include program management of the merger activity. It also covers the
development of the merged firm's new business model and execution of the myriad of process,
organization, and system changes.
D. 5. Supply Chain and Operations Management

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CGE&Y helps companies achieve differentiation through a supply chain that provides
customized products, bundled with a wider range of value-added services, delivered faster. It
assists with tools, systems, and techniques that create flexibility across the entire supply chain,
and it closely integrates processes with suppliers, alliances, and customers. The Group also
addresses the effective and efficient management of materials, goods, and services; information;
cash; and work processes and alliances from the point of first supply to the end user and back.
Along these lines, CGE&Y offers services in operations strategy, demand/supply planning,
sourcing, and supplier management, manufacturing and operations, transportation and
distribution, and customer and order management. Each solution addresses the information
systems necessary for the effective end-to-end management of supply chain functions.
D. 6. Combining People, Knowledge, Process, and Technology
CGE&Y says that turning strategy into action requires motivated, trained employees, adept
process changes, and robust technologies. It supports each of its solution areas with a range of
competencies dealing with people, knowledge, process, and technology issues. These
competencies are brought to bear on an as-needed basis to achieve the desired changes.
D. 7. People AdvantEDGE
CGE&Y looks to provide the solutions to organizational and people issues necessary for
implementing enterprise-wide, technology process transformation within complex environments.
Its People AdvantEDGE solutions include developing end user competency, transforming human
resource processes, managing change, and redesigning and aligning organizations.
D. 8. Knowledge Solutions and Knowledge-Based Businesses
CGE&Y provides companies with approaches that are designed to improve a companys
ability to create and apply knowledge across an organization. Its solution services provide
support for knowledge development, acquisition, sharing, and application.
The company also helps implement and operate knowledge-enabling technologies. It
develops and deploys Internet and intranet applications, as well as communications and
collaboration tools and data management technologies. To support a customers requirement,
CGE&Y consultants can tap its knowledge library.
D. 9. Process Transformation

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CGE&Y says that process transformation solutions can reduce product cycle time by as
much as 50% and seamlessly fuse all of the elements needed for process change. These
include marketing coordination, methods development, people development, learning, and
training development. It also encompasses assistance in selling, staffing, and decision making.
Overall, CGE&Ys process transformation solutions guide companies through change efforts for
long-term capital growth, delivery of short-term improvements, and/or highly focused incremental
improvements, offering a fast return on investment.
D. 10. Systems Development and Integration
CGE&Y designed its SD&I solutions to align a customers business systems with a strategy
using the best available technologies. To achieve these goals, CGE&Y guides companies
through the implementation of enterprise-wide ERP solutions, including Oracle, PeopleSoft, and
SAP. Throughout the process, it works closely with vendors to develop, implement, and integrate
innovative system solutions. CGE&Ys solutions range from providing package implementation
for supply chain and customer-facing applications to addressing the integration challenges of a
post-merger or acquisition environment.
D. 11. Technology Advisory Services
CGE&Y helps companies develop the technology architecture and infrastructure that
supports their business systems and optimizes their technology investments. Its focuses on
developing solutions in technology architecture, infrastructure, advanced applications, and
management of the technology infrastructure.
The scope of its technical support services includes IS architecture (application, data and
technology architecture, and cost estimations); IS planning (information systems, technology
implementation plans, and IT alignment with business strategy); technical engineering and design
(networks, platforms, databases, and data center configurations); and IS operations and
management (IS organizational design, systems, and network management).
E. Telecom, Media & Networks

As part of Cap Gemini Ernst & Young and organized as a Global Business Unit, the TMN
Group provides strategic consultancy and hands-on technological expertise to organizations
operating in the converging areas of technology. In 2000, an estimated 70% of the worlds top
telecom businesses relied on the services provided by the TMN group, representing 18% of the
FY00 Cap Gemini Ernst & Young pro forma revenue. The Group employs roughly 5,600
management and IT consultants who operate from roughly 25 locations throughout the U.S., Asia,
and Europe. The TMN Group also draws heavily on the expertise of its extensive alliance
network that includes partnerships with over 40 technology vendors, including Cisco Systems,
Portal Software, Nokia, Clarify, and Oracle. The TMN Group operates 11 research, development,
and innovation labs throughout the world: Atherton CA, Boston, MA, Dallas, TX, London (3),
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Munich, Paris (2), and Singapore. The company also has a European-based Mobile Technology
Lab, which enables the TMN Group to maintain strict quality control standards by testing system
reliability before installation, for example.
Strategy and Business Consulting -- TMN provides high-end strategy and business
consulting and business creation for telecom, media, and enterprise organizations.
From improvements in production and distribution, including e-business strategies, to
better reporting and quality control, it develops solutions that give its clients a
competitive advantage over rivals, which can be sustained over time
Network Infrastructure Solutions -- CGE&Y designs and implements network

operations centers (NOCs) and develops tailored, end-to-end configuration
management and fault isolation solutions that let clients proactively monitor and
control their networks. The Groups services include network analysis, architecture,
and deployment, as well as end user training. Its network integration services also
cover network engineering expertise to support Cisco-based New World Network
solutions.
Operations Support Services -- Cap Gemini Ernst & Young combines business
acumen with unparalleled expertise in automating and integrating complex telecom
processes, offering high quality, seamless Operations Systems Support (OSS)
solutions. It works with the full spectrum of OSS functions, including network design
and inventory, service provisioning and activation, as well as service assurance and
workforce management. TMN offers a full suite of services, including package
selection, project/program management, package implementation/integration,
business process design, data conversion/migration, custom development, end user
training, and interconnect gateway integration for all types of carriers.
Customer Relationship Management -- TMN helps clients through offerings that

include CRM strategy, customer intelligence and target marketing, sales force
automation and effectiveness, and integrated call centers. It helps develop the
vision, operating principles, metrics, a model, and a prototype of customer
experience.
Digital Content Management -- With the emergence of digital TV, electronic

publishing, interactive advertising and services, and the Internet, fundamental
structural change is occurring across the communications industry. A few existing
examples are multi-channel publishing, narrowcasting, and interactive advertising
and services. TMN helps clients steer a course through investment choices by
identifying rapidly evolving technology, new entrants, and changing market demand,
and then implementing the processes and technology required to make them work.
Billing and Customer Administration CGE&Y implements next-generation billing

systems for wireline, IP, wireless, or convergent services. With a dedicated service
line and close partnerships with package vendors, it builds and supports a full range
of CCB solutions. It also provides support with selecting packages, defining
requirements, program management, data converting, interfaces through enterprise
architecture middleware or point-to-point solutions, testing methods and procedures,
training, architecture configuration, and development. It also designs the business
processes, the people policies, and the technology architecture. Then, the Group
integrates the IT solutions using the most appropriate software package for each
customer environment. Specific billing and administration services include: billing
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transformation, newcomer customer care and billing, Internet billing, and lhs-based
customer care and billing.
E-Services -- Cap Gemini Ernst & Young has assembled the people, procedures, and
products that can provide the full spectrum of services required to succeed in an
evolving marketplace. It can devise innovative ways to incorporate the Internet and
electronic commerce into an operational model, including planning, project selection,
business case development, and organizational alignment.
Network Infrastructure Solutions -- CGE&Y designs and implements network

operations centers (NOCs) and develops end-to-end configuration management and
fault isolation solutions that let clients proactively monitor and control their networks.
Its services include network analysis, architecture, and deployment, as well as end
user training. TMNs network integration services also cover network engineering
expertise to support Cisco-based New World Network solutions.
RGI also notes that towards the beginning of CY01, CGE&Y and Vodafone chose Terenci as
the name for their Mobile B2B solutions joint venture. Terenci will integrate mobile services with
Internet and IT solutions to address the growing needs of European businesses to make mobile
technology an integral part of their operational processes. Terenci, which combines the
management consultancy, information technology, and integration skills of CGE&Y and the
mobile technology and services expertise of Vodafone, initially will focus on those segments of
the market where mobile access and timely information are crucial. These include areas of
freight and logistics, automotive, and construction.
F. Life Sciences and Chemicals

With nearly 500 professionals dedicated to partnering with global Life Sciences clients and
having consulted with more than 90 of the top companies in the sector, the Life Sciences and
Chemicals Group represents a leading consultancy in this industry. Customers include virtually
all of the world's largest pharmaceutical firms and many of the leading medical device and
biotechnology companies. Even a short list of Cap Gemini Ernst & Young's references in this
sector -- one marked by constant consolidation and growth -- provides some idea of this group's
global reach. It touts customers such as Akzo Nobel Hoffman La Roche, AstraZeneca, Johnson
& Johnson, Aventis Millennium Chemicals, BASF Novartis, Baxter Healthcare Oxford Asymmetry
International, Bayer Pharmacia (including Monsanto), Boston Scientific Schering-Plough, Eli Lilly
Smith & Nephew, and GlaxoSmithKline Syngenta. The practice has locations in 25 cities from
Atlantic to Zurich, Barcelona to Tokyo, and Johannesburg to Paris.
Overall, its Life Sciences and Chemicals sector helps to transform every segment of the
industry, including pharmaceuticals, biotechnology, chemicals, medical devices, and animal
health. The Group provides an end-to-end portfolio of integrated business and technology
solutions that can help companies generate growth and shareholder value. Service offerings fall
into the following areas: strategy and transformation, critical technologies, customer relationship
management, supply chain, support services, and ERP.
The Groups e-solutions also apply to the Life Sciences industry, as noted below.

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E-strategy acts as the portal to the e-solutions it offers to the life sciences industry. It
focuses on charting a course for CGE&Y clients to become a .company and then
assists in the management and execution of the entire transformation agenda.
Starting with an e-diagnostic and facilitated by a customized e-strategy workshop, the
Group will create a clear and prioritized set of objectives for a .company
transformation.
E-knowledge management uses Web-enabled functionality to improve the

competitive intelligence, market research, lessons, and insight management in R&D
and sales/marketing.
Customer relationship management provides Web-enabled connectivity to the

customer, end user of information, and business partners. It allows life sciences
companies to have an enterprise-wide view of customers and to understand the
potential of those customers to the company.
E-procurement has two key benefits. It improves the efficiency and lowers the cost of
supplying key areas of the company with needed materials such as R&D labs. It also
opens new channels for supplying the health market, including 300 buyers at key
integrated delivery networks.
E-clinical trial management uses Web-enabled connectivity to improve the recruiting

of patients and physicians, management of clinical research activities, and capture
and reporting of study results and conclusions.
E-enabled M&A/post-merger integration utilizes e-based technology to facilitate value

creation and extraction in the rapid design and implementation of mergers, alliances,
and .company spin-offs.
CGE&Y helps chemical companies balance their strategic direction with operational and
information technology requirements to produce significant results across the chemical value
chain. The Groups professionals help clients create and manage global supply chains,
consolidate service centers, envision global sourcing strategies, and implement new business
processes and systems. Overall, its experience with chemical companies has allowed CGE&Y to
accomplish the following:
Achieve growth targets by developing and implementing a new growth strategy;
Help define new market space and products based on existing competencies;
Facilitate the implementation of ERP software, such as SAP and Oracle, by

combining its change management capabilities and information technology expertise;
Restructure business processes and designed team-based organizations, which

have enabled transformation from regional to global operations;
Improve efficiencies in components of supply chain operations and effectively

integrated multiple functions when the business case justified the investment; and
Redesign capital portfolio and project processes to improve decision making and
accelerate project completion while lowering costs.

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G. Consumer Products, Retail, and Distribution

The Global Consumer Products, Retail, and Distribution (CPRD) practice conducts research
into market trends, as well as provides enterprise-wide solutions to help organizations create a
stronger, competitive edge. The practices approach includes a comprehensive suite of
capabilities ranging from customer relationship management to ERP Innovation. This Group has
9,000 full-time practitioners helping consumer products, retail, and distribution clients in more
than 30 countries. It also claims to have worked with nearly one-half of the world's 100 largest
retailers. CPRD has developed customized answers to the specific questions asked by
companies.
The Group also claims to have developed approaches for many CPRD global companies.
For example, it developed the Consumer Relevancy strategic framework after CGE&Y completed
studies of more than 10,000 customers. The research found a new customer emphasis on
values over product and service value. It also found a sizable gap between consumers
expectations and the companies in the sector trying to meet them. When it applied the Consumer
Relevancy framework to the problems of global companies, they improved their connections with
customers and competitive positioning.
CPRD also teamed with SAP and a global consumer products manufacturer to create a
beverage industry-specific pre-configured SAP solution. It also formed a joint venture, Ciberion,
focused on designing CRM solutions to solve the CRM problems faced by CPRD companies.
RGI also notes that recent projects include work with Kimberly-Clark, Danone, Ahold, Carrefour,
Deutsche Post, and Geodis. Overall its approach includes a suite of capabilities that include the
following.
Application Management and Integration;

ASPs;
B2B Exchanges;
Consumer Relevancy;
Customer Relationship Management;
E-Fulfillment and Logistics;
GrowthWorks;
PMI Shared Services;
mySAP Consumer Products Beverage Solution;
mySAP Retail;
Shared Services; and
Retail Operations.
H. Manufacturing
CGE&Y says that no other sector of the U.S. economy has felt the reality of global
competition more than manufacturing. Labor, raw materials, and capital are more fluid than at
any time in history. As trade and political barriers come down, new markets have opened in Latin
America, Eastern Europe, and Asia, resulting in new competitors. To compete in their respective
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marketplaces, U.S. manufacturers have been retooling for global leadership. Manufacturers have
been searching for ways to shorten time-to-market and to manufacture higher quality products at
lower costs.
The Cap Gemini Ernst & Young U.S. (CGE&Y) Manufacturing Group helps U.S.
manufacturers find solutions. It provides a wide range of professional services to leading global
manufacturing clients. In addition, it has alliances with leading information technology firms and
plays a leading role in industry/trade organizations, government "think tanks," and universities to
develop leading competitive advantage concepts important to U.S. manufacturers.
Based on the Connected Manufacturing Enterprise (CME) strategy, CGE&Y goes on to say
that the manufacturing industry has entered a new era, one in which companies rely on the use of
networks as opposed to traditional manufacturing processes. It created the Connected
Manufacturing Enterprise (CME) to address these changes in manufacturing. CME addresses
the following:
Shifts in production technology;

Shifts in the position of manufacturing within the economy;
Changes in the role and management of labor; and
Changes in the customers' perception of value.
In addition, CME also will develop likely scenarios for the industry over the next three to five
years, as well as the strategies needed to adapt to the connected economy. To predict the
changes to come, CME plans to use the Delphi Process. Developed to forecast the future of
post-WWII Eastern Europe, it has since been adapted and applied to many industries to forecast
future changes and issues.
RGI also notes that the CGE&Y Process Manufacturing group offers various IT services to
solve the specific needs of chemical and life sciences companies in the process manufacturing
sector. It helps clients change their business paradigm to take advantage of their Enterprise
Resource Planning (ERP) systems and supply chain systems -- an area in which process
manufacturers have traditionally lagged behind other industries. With enterprise effectiveness, it
assists companies in maximizing value from ERP in the post go-live environment.
During August 2001, Cap Gemini Ernst & Young and GE Cisco Industrial Networks announce
an unique North American alliance to deliver adaptive manufacturing solutions to industrial
companies worldwide. Bridging the system-wide gap between manufacturing shop-floor
operations and business Enterprise Resource Planning (ERP) systems, this solution enables
real-time visibility and decision making by allowing companies to be better connected, more
responsive, and better managed across their business enterprise. CGE&Y goes on to say that
the solution helps to decrease build-to-order lead time, increase product yields, and improve
inventory turns.
I. Utilities and Energy

CGE&Y claims more than 5,000 consultants engaged in energy and utilities projects across
Europe, North America, and Asia/Pacific, generating 10% of the consolidated FY00 Group
revenue. The Groups Energy and Utilities practice serves the business consulting and

978-386-5858
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information technology needs of many of the world's largest players of this industry, covering two
areas: oil and gas, and utilities.
The Group has developed industry-specific service lines such as trading and risk
management and advanced e-business solutions. For example, the Energy and Utilities Global
Sector unit has been working with Equiva Services, the Shell-Texaco Saudi Aramco joint venture,
to help establish a position across a breadth of e-business services. CGE&Y also helped with the
launch of Enporion, a U.S. marketplace linking nine electronic and gas utilities to over 50
suppliers for online procurement and dynamic commerce. In Australia, the Group has been
working with NEMMCO, the authority charged with setting up the open energy technology market.
In Canada, it signed an outsourcing agreement with Ontario Power Generation.
It also provides several solutions for the utility services market, which RGI discusses as
follows:
For Independent Systems Operators and Regional Transmission Organizations -CGE&Y offers services ranging from economic analysis of market mechanics to
systems development and integration. Its software solutions cover settlements,
billing, customer enrollment, and use aggregation and profiling. CGE&Y also
established a delivery center for specific ISO and RTO software solutions.
For Generation Operations Improvement -- CGE&Y's professionals offer a broad

range of services supporting the acquisition, operation, and disposition of fossil,
nuclear, and hydro-generation assets. Its Nuclear Solutions Group acts as the
leading transformation advisor to nuclear operators in North America. In addition, its
e-generation team helps generation operators harness the power of the connected
economy to lower costs and increase performance.
For Energy Trading Systems and Risk Management -- CGE&Y developed methods
for project and risk management, process acceleration, and knowledge transfer. It
offers application and data models, technical infrastructure configurations, project
methodologies, and accelerated solutions capabilities. Through the Magellan Energy
Trading Center of Excellence, it offers energy trading and risk management
accelerators that are designed to help customers develop trading processes and
systems quickly and cost effectively.
RGI also notes that during October 2001, Hydro One selected CGE&Y Canada to enter into
contract negotiations to transfer existing Hydro One e-services capabilities to Cap Gemini Ernst &
Young. This was part of Hydro Ones efforts to increase its competitiveness. CGE&Y and Hydro
One have been negotiating a ten-year contract to manage and operate technology-enabled
services to Hydro One, which owns and operates one of the ten largest transmission and
distribution networks in North America. The Group will provide a range of information technology
and business process services to the Hydro One family of companies, including IT, customer
care, supply chain, and certain transactional human resources and finance processes. Hydro
One, through its subsidiaries, is principally engaged in electricity transmission, distribution,
telecommunications, and energy services businesses.
J. Transportation

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Cap Gemini Ernst & Young U.S. (CGE&Y) looks to assist the transportation industry as it
moves into a more connected and global marketplace. Those choosing CGE&Ys solutions
include major airlines, rail carriers, shippers, hotels, travel companies, airplane manufacturers,
and automotive manufacturers. It helps these companies develop strategies, form alliances,
adopt new technologies, improve operations, and connect with customers.
J. 1. Maintenance Repair Overhaul (MRO)
CGE&Y's airline MRO solutions act as the key to organizational and systems transformation
for clients facing aging information technology architectures, growing capital costs for aircraft
maintenance, and increasing consolidation. Its solutions address the full maintenance lifecycle,
allowing companies to improve decision making abilities, reduce inventory, market more
effectively, and improve inventory control. They support the aviation/aerospace/airline
environment and leverage the extensive integration capabilities of ERP software to enable wallto-wall management of the MRO function. In addition, it has established MRO Centers of
Excellence in Dallas, TX, and Auckland, New Zealand. CGE&Y plans additional centers for
Europe and Asia.
J. 2. Value Exchange
CGE&Ys Value Exchange gives companies the ability to manage the value invested in,
versus the value received from, each customer relationship. Using this process, companies
evaluate the cost of investing in a customer (e.g., service levels, product attributes, pricing,
distribution channels, etc.), relative to the value received in return from that customer's profitimpacting behaviors (e.g., purchasing products, referring new customers, etc.). Value Exchange
also can be used for optimizing and managing the value of relationships with employees and
suppliers, using the same process of focusing investments to produce targeted, profit-impacting
behaviors.
J. 3. Shared Services
The Shared Services solution offers transportation companies the opportunity to reduce the
time, effort, and resources applied to internal support services (e.g., finance, accounting, human
resources, procurement, etc.). By converting these functions into discrete business units
dedicated to serving the company -- in some cases, serving the outside marketplace and
generating revenue -- companies can spend more time focusing on their core competencies.
Through Shared Services, CGE&Y helps guide companies through the process of defining and
executing strategies for achieving cost and performance goals.
J. 4. Outsourcing and Joint Ventures

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CGE&Y has established a global alignment of industry teams dedicated to delivering customcrafted outsourcing solutions. It helps to identify and act on key outsourcing opportunities that
increase operating efficiency and shareholder value. The company has streamlined its services
into three primary areas:
Business Process Outsourcing (BPO) -- back-office and administrative processes;

Technology management -- complete responsibility for a client's IT environment; and
Applications management -- maintenance, development, enhancement.
It can deliver these services both through traditional outsourcing contracts and through what
CGE&Y calls the market differentiator --The Transco Model. Transco (short for "Transformation
Company") represents a deal construct that helps accelerate the transformation of a customers
business. The Transco model creates a relationship between CGE&Y, the company, and a new
jointly owned enterprise that aligns incentives and provides adaptability for a changing business
environment.
J. 5. Strategic Sourcing
CGE&Y applies Strategic Sourcing to help companies implement innovative programs that
can lead to reductions in material and service costs, while enhancing service levels to customers.
Using a four-phase process, it analyzes a company's sourcing processes, policies, and supply
base to help capture immediate cost savings and cash flow improvements. Areas of focus
include contract re-negotiation, transportation cost reduction, and group leveraging.
J. 6. Enterprise Resource Planning
Enterprise Resource Planning (ERP) unifies a company's information systems into an

integrated software package. It integrates business processes, decision disciplines, performance
measurements, and people with the technical platform that the ERP system provides. Working in
tandem with an ERP vendor, such as SAP, Oracle, BAAN, or PeopleSoft, CGE&Y helps to deliver
a total solution to maximize value and leverage a company's overall investment in a software
package. CGE&Y says it has become the systems integrator of choice for companies worldwide.
J. 7. Supply Chain and Operations Management
CGE&Ys supply chain solutions address the management of materials, products, and
services; information; cash; and work processes and alliances from the point of first supply to the
end user. It assists customers with tools, systems, and techniques that create flexibility across
the supply chain. In addition, it closely integrates a clients processes with those of suppliers,
alliances, and customers. Those using the solution can realize increased sales, reduced costs,
decreased working and fixed capital, reduced taxes, and simplified business processes.

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Customer Support
Cap Gemini Ernst & Young does not provide the same form of customer support as does a
computer vendor such as Dell or Gateway. As a provider of management consulting and
Information Technology services, the Group bundles customer support services into its overall
services offering.
In general, the firm has multiple Global Sector units designed to help CGE&Y provide an
integrated solution for its customers. These were established to provide customers with solutions
that integrate CGE&Ys management consulting and IT services. In addition, CGE&Y offers
various Enterprise Resource Planning Packaged Based Solutions (PBS) designed to help
businesses grow. The following chart indicates the Groups various centers that can be
considered part of the support process. RGI also notes it also offers Centers of Excellence
locations that cover areas of focus such as mobile communications and several industries,
including automotive. Similar to its other service centers, these locations give customers the
ability to test applications and solutions of interest.
Cap Gemini Ernst & Young Support Centers
Industry
Global Sectors
Industry
Global Sectors (Cont)
Packaged-Based
Solutions/Practices
Other Service Centers
Telecom & Media

(Separate unit in alliance
with Cisco)
High Technology
Automotive
Baan
Applications
Management Service
Centers (AMSC)
Life Sciences &

Chemicals
Consumer Products
Retail & Distribution
Oracle Applications
Enterprise Management
Service Centers
Financial Services
SAP
Integrated Supply Chain

Management (ISCM)
Service Centers
Energy & Utilities
PeopleSoft
Customer Relationship
Management (CRM)
Service Centers
Source: Cap Gemini and RGI Research

Cap Gemini Ernst & Young also looks to add value through thought leadership centers,
where the Group provides ongoing research, collaborative knowledge, and progressive
methodologies to bring fresh approaches to business challenges. Its centers of excellence
Accelerated Solutions Environment -- The Accelerated Solutions Environment (ASE)

acts as an approach for creating and transforming enterprises. It designs and
develops the technology solutions that both drive and support these major
transformation efforts. CGE&Y designed the ASE to support a collaborative, focused
process. It engineered the environment for developing and testing new business
strategies and the complex technology solutions that support them.

978-386-5858
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Benchmarking Services Group -- The Benchmarking Services Group (BSG) globally

delivers high quality performance assessments to Cap Gemini Ernst & Young client
teams through a cost-effective approach. By utilizing benchmarking methods and
tools, the BSG identifies value-added opportunities with clients. The BSG looks to
identify and quantify opportunities with clients. It also explores aggregate trends and
relationships that can be utilized to the firm's advantage on client pursuits and
engagements.
Center for Business Innovation -- The Cap Gemini Ernst & Young Center for
Business Innovation (CBI) anticipates and shapes the evolution of business. The
CBI creates new service offerings and businesses, providing value for clients. The
CBI achieves this through its research and collaboration with a diverse network of
leading thinkers and by communicating its knowledge to broad audiences.
Center for Enterprise Creation -- The Center for Enterprise Creation provides the
people, the process, and the place to build new economy businesses quickly. Its
network of centers leverages CGE&Y's consulting capabilities and the newly
established Value Web -- a large network of service providers that includes legal,
recruiting, branding, hosting, and financing. The Center for Enterprise Creation acts
as the catalyst for corporations to re-purpose, leverage, and monetize assets such as
brand, people, and customers. It allows them to reclaim their position as innovators
in the marketplace.
Global Delivery Center Dallas -- The Cap Gemini Ernst & Young Global Delivery
Center (GDC) helps companies transform the way they do business by building the
tools, methods, techniques, and training needed to support the "innovated
enterprise." Professionals in Cap Gemini Ernst & Young's GDC practice drive and
support its competencies in all management consulting services.
RGI also notes that the company has other centers focused on a particular alliance that
targets a market or industry sector. For example, as recently as January 2002, CGE&Y
announced the opening of an IVT center for Cisco Systems located in Paris, France. It covers
Internet Protocol (IP) Telephony and Content Networking technologies, a crossroad featuring
both functional and architecture aspects. TMN hosts the IVT center to serve its partners and
customers. The IVT center promotes competencies in the testing processes for IP telephony, call
center, and rich media streaming environments. It also has a global network of wireless centers
of excellence, and CGE&Y has equipped these centers with technology from providers of
wireless components. Through this facility, it address many of the key challenges unique to the
mobile computing model. These include areas of multiple device type compatibility, wireless
channel integration, mobile payment and trading systems integration, and security and
authentication.

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