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Upside NEWS FROM THE WORLD OF WORK Public 2 Private Talent2 International Limited reports that its major shareholders, Andrew Banks and Geoff Morgan, have proposed to take the business private in a move to allow the company more flexibility to meet its strategic global growth plans. The privatisation proposal—unanimously recommended by the Independent Board Committee (IBC) in the absence of a superior proposal and subject to an independent expert concluding that the offer is in the best interests of shareholders—aims to position Talent2 to be the best end-to-end talent management organisation in the world by 2015. And it would significantly expand its global footprint in human resources outsourcing (HRO). Talent2 announced to the Australian Securities Exchange that it has entered into an agreement with Morgan & Banks Investments (MBI), a company owned by Banks and Morgan, and Allegis Group, Inc., to acquire all outstanding Talent2 shares, for a cash consideration of $0.78 per share. The existing Allegis Talent2 alliance points to success in delivering global recruitment process outsourcing (RPO) and managed services. The privatisation structure aims to create a closer bond between the two organisations. The proposal also falls in line with current HRO market consolidation trends to strengthen global capability and expertise. As part of the agreement, MBI and Allegis do not intend to make any changes to the operating structure or the senior management team, which will continue to focus on driving performance and business growth for Talent2. Banks will continue to operate as chairman of the ongoing organization, and he and Morgan will remain on the board with day-to-day leadership responsibilities of the business. Conditional on shareholder and court approval, amongst other things, the privatisation is expected to be finalised by September 2012. Talent2 shareholders will be sent full details of the privatisation proposal in July and will have the opportunity to vote on the proposed transaction. Q1: Looking Good Transaction volumes are up: The first quarter of 2012 saw 441 outsourcing deals compared to 433 transactions in the fourth quarter of 2011. Everest Group's Market Vista: Q1 2012, a quarterly report on global outsourcing and offshoring activity, finds first quarter global transaction volumes reached nearly $3 billion in annual contract value (ACV), an increase of 11 per cent over the previous quarter. Compared to Q4 2011, the market saw a 9 per cent increase in business process outsourcing (BPO) transactions whilst IT outsourcing (ITO) transaction volumes remained the same. New transactions accounted for 83 per cent of all deals signed during the timeframe. Two mega deals, each valued at more than 1 billion dollars in total contract value (TCV), were also signed. Other findings include: • Transaction volumes decreased in North America, held steady in the United Kingdom, and increased significantly in the rest of Europe. • India and Asia each saw six captive set-ups followed by four in Europe and two in Latin America. • Offshore activity saw 30 delivery centres established across captives and service providers in the first quarter, compared to 29 in the previous quarter. Significant activity occurred in Asia, Latin America, and Eastern Europe. [8] HRO TODAY GLOBAL | SPRING 2012 Engagement: Looking Up A new study from Aon Hewitt has some positive news: Employee engagement is up. The 2012 Global Engagement Report found that 58 per cent of employees were engaged in 2011, an increase from 56 per cent in 2010. The study seeks information around employee engagement trends of more than 3,100 organisations representing 9.7 million employees worldwide. Aon Hewitt's analysis showed improvements in employee perception scores in three key areas in 2011: • Effective leadership at the business unit/division level was 61 per cent (54 per cent in 2010) • HR practices creating a positive work environment was 53 per cent (47 per cent 2010) • Perceiving relationships with customers as rewarding was 75 per cent (70 per cent in 2010) The analysis also showed a decline in three key perception scores in 2011: • Effective communication was cited at 42 per cent (46 percent in 2010) • Innovation came in at 52 per cent (55 per cent in 2010) • Workplace safety and security was 75 per cent (78 per cent in 2010) While overall engagement levels increased, Aon Hewitt's study found significant variances by region. Improvements in APAC engagement scores (58 per cent in 2011 versus 55 per cent in 2010) contributed to the overall upward movement of global engagement. Europe showed an upward shift by one percentage point, from 51 per cent in 2010 to 52 per cent in 2011, while Latin America, the region with the highest regional engagement levels, experienced a slight decline in engagement levels, from 72 per cent in 2010 to 71 per cent in 2011. Employee engagement scores in North American remained unchanged from 2010 at 64 per cent (see Figure 1). 2011 North America 64 per cent Asia Pacific 58 per cent Europe 52 per cent Latin America 71 per cent 51 per cent 72 per cent "Our global clients are becoming increasingly sophisticated in analyzing results by region and business unit," notes Ken Oehler, global practice leader of engagement at Aon Hewitt. "We are cascading the results and insights further into organisations so that companies can implement targeted actions that will have the most impact on the engagement levels of discrete employee populations." 2010 64 per cent 55 per cent