BearingPoint

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BearingPoint
Founded 1997
Headquarters European flag.svg Amsterdam, Netherlands
offices in 14 countries
Key people Peter Mockler
Industry Management consulting, technology services
Revenue € 567 Million (2008)
Employees 3,250 (2009)
Website www.bearingpointconsulting.com

BearingPoint is an independent management and technology consultancy. Following a post-bankruptcy management buyout in August 2009 BearingPoint is operated by its European management team and is organized as a partnership. BearingPoint is a European based company, but operates with a global reach.

Contents

[edit] Recent history

Before its breakup 2009 and acquisition in part by other companies, BearingPoint Inc. was one of the world’s largest providers of management and technology consulting services to Global 2000 companies and government organizations in more than 60 countries. Based in McLean, Virginia, USA, the firm reported approximately 17,100 employees and major practice areas focusing on the public, financial and commercial services. With a $1 billion debt and a looming repayment deadline, the company filed for Chapter 11 bankruptcy for its US operations on February 18, 2009. The company asked the courts to allow operations to continue uninterrupted during what was termed as a reorganization.[1] By May 2009, the company's Japan business unit had been sold off to PricewaterhouseCoopers[2], one North American unit had been acquired by Deloitte, another was being purchased by PwC subject to court approval,[3] and the BearingPoint website said it was "no long hiring employees in North America." Its Brazil unit went to CSC in July 2009[4] and China unit to Perot Systems in October the same year.[5]

In Australia, BearingPoint completed a local Management Buy Out (MBO) in September 2009. As a whole owned and operated Australian entity BearingPoint continues to successfully deliver Management and Technology solutions in that country.

Prior to reorganization, the company was profiled as providing management and technology strategy, systems design and architecture, applications implementation, network infrastructure, systems integration and managed services, all in the effort to help clients make money, reduce costs and find information quickly. In 2006 the company had been among Fortune magazine’s “Most Admired” companies in its Information Technology Services sector.[6].

[edit] History

The company has a 100-year history. It emerged as KPMG’s consulting services, created as a distinct business unit in 1997. KPMG had been providing consulting services to clients since its first contract with the US Navy prior to World War I. On January 31, 2000, KPMG formally spun off the consulting unit as KPMG Consulting, LLC. On February 8, 2001, the company went public on the NASDAQ market at $18 a share under the ticker "KCIN."

Over the next year and a half, the company acquired some of KPMG’s country consulting practices, plus country practices and hiring from Arthur Andersen’s business consulting unit. On October 2, 2002, the company was re-named BearingPoint and the next day began trading on the New York Stock Exchange under the ticker “BE.”

The company had been sponsoring golf professional Phil Mickelson, who had been wearing the BearingPoint/KPMG Consulting name on the front of his cap, since 2000. However, on Feb 1, 2008, the company announced on its website that it was ending its relationship with Mickelson, effective immediately[7]. Mickelson has since entered into a sponsorship relation with BearingPoint's former parent, KPMG.[8]

In 2008, it was ranked by BusinessWeek as one of the Top 75 places to launch a career[9] and by Defense News as one of the Top 100 Defense Contractors.[10]

On November 13, 2008, BearingPoint received notice from NYSE Regulation, Inc. (the "NYSE") that the NYSE had decided to suspend BearingPoint's common stock from trading prior to market opening on Monday, November 17, 2008.[11].

On February 18, 2009, BearingPoint filed for Chapter 11 bankruptcy protection. Unable to sustain the heavy debt load resulting from ill-advised expansion moves and costly management errors, the company negotiated debt for equity swaps with its creditors and zeroed the value of its common shares, wiping out existing investors.

On March 23, 2009, BearingPoint announced on its website that it reached an agreement to sell a significant portion of its Public Services practice to Deloitte. It also signed a non-binding letter of intent to sell a substantial portion of its Commercial Services practice to PricewaterhouseCoopers (PwC). Finally, it is in separate negotiations with other parties and local management teams involving the remaining parts of its business, including the potential sale of its practice in Japan to PwC.

On September 3, 2009, BearingPoint announced on its website that effective August 28, 2009, BearingPoint is now operated by its European management team and owned by about 120 Partners in 14 countries throughout Europe. Peter Mockler, who has been serving as the EMEA leader for BearingPoint since 2006, and his management team will continue to lead the organisation, providing leadership stability and continuity. Employing 3.250 people in the European region, the independent company will keep operating under the BearingPoint brand.[12]

[edit] Organization

BearingPoint is organized around three industry business units – Public Services, Commercial Services and Financial Services.

Each industry group breaks out into segments.

  • Financial Services consists of Banking, Insurance, Global Markets, and Hospitality services.
  • Public Services consists of Defense; Emerging Markets; Federal / National Government; Health Services; and State and Local Governments / Education / Nonprofits.
  • Commercial Services, which addresses the widest swath of the market, consists of Automotive; Energy and Chemicals; Communications and Media; Consumer Packaged Goods; Electronics / Software; Life Sciences; Industrial Markets; Retail / Wholesale; Transportation; and Utilities.

While many of company’s offerings have emerged from the industry teams, it now has dedicated organizations for developing, launching and delivering them. The Management Consulting unit works on business strategy and related issues; customer relationship management; supply chain management; financial management; mergers and integration; human capital management; business process and performance improvement; growth and innovation; and business transformation. The Technology Solutions unit focuses on application services and integration; custom and large-scale systems integration; network infrastructure and managed services opportunities, predominantly applications management.

[edit] BearingPoint INFONOVA

BearingPoint INFONOVA is a wholly owned subsidiary of BearingPoint, and was founded in Graz, Austria in 1989. The company has worked with leading telcos around the globe.

BearingPoint INFONOVA offers products and services in IP Telephony, Operational Support Systems (OSS) and Business Support Systems (BSS), Internet Infrastructure Technology, Network Management, eSecurity, Interactive TV & Digital Video Broadcasting as well as technology consulting and training.

The product Infonova offers customer management, service provisioning, and billing functions for voice, Internet, data, TV, and content services. In addition, it incorporates an “umbrella” OSS which integrates COTS and network equipment provider’s OSS products into a single integrated solution delivering seamless network service management functions such as performance monitoring, fault management, customer problem management and service level reporting.

The solution was created in 1989 to deliver Videotex on a Unix server over an IP network, which soon became one of the first “nationwide IP VPN networks” worldwide. This network has a core IP backbone with dial-up and fixed access lines delivering services for consumers and businesses alike. It is a precursor to today’s vision of fully IP networks over fiber, copper and wireless links, and is managed by Infonova.

[edit] Alliances

On February 14, 2006, BearingPoint announced the first industry teaming arrangement with Google to offer products to help enterprises find internal data more easily.

The company also works with software vendors Google, Microsoft, Oracle, CA and SAP, and hardware vendors HP and IBM, and several dozen smaller partners.

[edit] Financial position

The company filed for Chapter 11 in the U.S. Bankruptcy Court in the Southern District of New York on February 18, 2009, with $2.23 billion in total debt and $1.76 billion in total assets as of Sept. 30. The filing includes only the company's U.S. operations.

BearingPoint was late in filing its financial reports through 2007. The company is now current in filing its financial reports. The Company said its net loss for the first quarter ended March 31, 2007 narrowed as revenue grew and costs declined. The company recorded a net loss of $61.7 million, or 29 cents per share for the first quarter, compared with a loss of $72.7 million, or 34 cents per share, in the same period a year earlier.[13] The company recorded a net loss of $64.0 million, or 30 cents per share for the second quarter, compared with a loss of $2.85 million, or 1 cent per share, in the same period a year earlier. BearingPoint's shareholders' deficit was $365 million as of the close of the second quarter 2007 with a total accumulated deficit of $1.9 billion.[14] On Aug. 11 2008, the company reported its first net income in three years and, as of the third quarter of 2008, had reported operating income for three consecutive quarters.[15]. During the third quarter of 2008, BearingPoint said its net loss was $30.5 million or $0.14 a share, an improvement of $37.5 million compared to the third quarter of 2007. BearingPoint's shareholders' deficit was $469.2 million as of the close of the third quarter 2008.[16]

The company has defended itself in several court cases concerning allegations of contracting irregularities and disclosures that its officials overstated its profits in 2003. BearingPoint said it continues to work toward timely filings before the end of the 2007. It also said that its failure to timely file certain periodic reports with the SEC poses risks to its business, which could hurt its financial condition and results of operations.

BearingPoint has had difficulties with several major clients, including an outsourcing arrangement with Hawaiian Telcom.[17] On February 7, 2007, BearingPoint announced that it had reached a settlement with Hawaiian Telcom due to issues with an IT system contract, paying the Hawaii telco $52 million and erasing an additional $30 million in previously submitted invoices. In exchange, Hawaiian Telcom released BearingPoint from any further liability. A day later, Hawaiian Telcom announced that it had signed a contract with Accenture to take over BearingPoint's role in their systems development.[18]

On December 10, 2008, BearingPoint filed a Certificate of Amendment to the Certificate of Incorporation of the Company with the Secretary of State of the State of Delaware to effect a previously approved reverse stock split of the Company's outstanding common stock, par value $0.01 per share, at a ratio of one-for-fifty. The reverse stock split will be effective at 6:01 p.m., Eastern Time, on December 10, 2008, at which time every fifty shares of Common Stock that were issued and outstanding will automatically combine into one issued and outstanding share of Common Stock. The Company expects that its Common Stock will trade on the OTC Bulletin Board on a post-split basis under the new trading symbol "BGPT" beginning on December 11, 2008.[19]

Critics of BearingPoint observed that the steady decline of the company's finances occurred at a time when competitors did not experience equivalent distress. Unexplained irregularities in the financial history of BearingPoint include the failure to invest any significant portion of the IPO funds in the company; the rapid placement and liquidation of a large investment by Cisco preceding the IPO; the assertion that the company, which sells expertise in implementing financial systems, bungled its own financial systems deployment; the multiple restatements of earnings; a lengthy failure to file financial statements; and auditors' findings of inadequate internal financial controls.

[edit] Economic development projects

To help win emerging-markets work, the firm in 2000 retained the Barents Group in its separation from KPMG. The Barents Group specialized in economic consulting in developing countries, usually through contracts awarded by the US Agency for International Development (USAID). Barents Group was also the leading Privatization Advisory firm in Emerging Markets of Eastern Europe and CIS, including privatizations of gold mines in Uzbekistan through its offices in Tashkent, in 1995-97.

Once incorporated into BearingPoint’s Public Services industry organization, Barents Group evolved into BearingPoint’s Emerging Markets segment and gained a reputation for doing economic project work in post-conflict regions.

BearingPoint arrived in Afghanistan after the collapse of the Taliban to advise the government in 2003 on economic restructuring. The multi-year $170 million USAID contract provided technical staff to the Afghan Ministries of Finance, Telecommunications, Economy, Commerce, and the Central Bank, Parliament and office of the President. Deliverables included bank licensing and supervision, creation of the capital notes market, monetary policy to limit inflation, privatization of the telecom sector, creation of a telecom independent regulator, modernization of customs and taxes, and the introduction of the commercial framework and laws.[20]

One such project relates to a $240 million USAID contract for assistance in the development of a competitive private sector in Iraq, where according to a federal investigation the job specifications had mostly been written by BearingPoint itself, effectively excluding competitors from the bid. Ultimately, however, BearingPoint won the project in open competition. This contract led BearingPoint to be listed as the number two "war profiteer of 2004"[21] by the Center for Corporate Policy, a think tank founded by Ralph Nader.[22]

On May 29, 2007, BearingPoint employee Peter Moore and his four security guards (employed by Canadian security company Gardaworld) were abducted from the finance ministry in Baghdad, Iraq. All five men were British. The kidnappers wore Iraqi police uniforms, and arrived in up to 40 police vehicles.[23] On June 20, 2009, the bodies of two of the security guards were handed over to local authorities, apparently in response to the release from custody of Iraqi militant Laith al-Khazali, one of the kidnappers' original demands.[24]

[edit] Open Source Initiatives

BearingPoint plays an active role in the open source community. MIKE2.0 (Method for an Integrated Knowledge Environment) is an open source delivery methodology for Enterprise information management that was started by BearingPoint and released to the open source community in December, 2006 under the Creative Commons Attribution License. The technology platform that supports MIKE2.0 (omCollab) uses a foundation of open source technologies with a number of extensions and customizations. The overall product is referred to as "omCollab" and is released in its entirety to the open source community[25] as part of the project.

Since its release to the open source community, MIKE2.0 has been referenced a number of times as a case study on Web 2.0 communities [26] [27] , including a recently released book, Groundswell. The content has also been taught through a number of online webinars and as a part of a Melbourne University lecture series on Data Warehousing [28], of which some of the training materials are available on the MIKE2.0 site. AIIM have based their Enterprise 2.0 specialist certification program around the MIKE2.0 Solution Offering and use the overall approach as a training case study. [29],

[edit] References

  1. ^ [1]
  2. ^ http://www.pwcadvisory.co.jp/e/news/2009/0324.html
  3. ^ [2]
  4. ^ http://www.csc.com/newsroom/press_releases/29337-csc_enters_into_agreement_to_acquire_bearingpoint_operation_in_brazil
  5. ^ http://www.perotsystems.com/MediaRoom/NewsReleases?s=43&item=554
  6. ^ Fortune: Most Admired Companies: Snapshot
  7. ^ BearingPoint – Press
  8. ^ Phil Mickelson
  9. ^ http://images.businessweek.com/ss/08/09/0904_first_jobs/76.htm
  10. ^ http://www.defensenews.com/static/features/top100/charts/top100_08.php?c=FEA&s=T1C
  11. ^ [3]
  12. ^ http://www.bearingpointconsulting.com/content/press_7913.htm
  13. ^ [4]
  14. ^ http://media.corporate-ir.net/media_files/irol/12/121861/2007Q2Form10-Q.pdf
  15. ^ http://phx.corporate-ir.net/phoenix.zhtml?c=121861&p=irol-newsArticle&ID=1224667&highlight
  16. ^ http://ccbn.10kwizard.com/xml/download.php?repo=tenk&ipage=5968563&format=PDF
  17. ^ http://the.honoluluadvertiser.com/article/2006/Nov/08/bz/FP611080316.html
  18. ^ Hawaiian Telcom hires new help
  19. ^ http://biz.yahoo.com/e/081210/bgpt.ob8-k.html
  20. ^ USAID/Afghanistan: Economic Governance & Private Sector Strengthening (EGPSS) Program
  21. ^ The Center for Corporate Policy's Ten Worst War Profiteers of 2004
  22. ^ Sourcewatch article on Center for Corporate Policy
  23. ^ BBC News: Five Britons abducted in Baghdad
  24. ^ BBC News: British hostage bodies identified
  25. ^ Andreas Rindler. "omCollab contribution to the open source community". www.openmethodology.org. http://mike2.openmethodology.org/blogs/information-development/2008/07/11/omcollab-enterprise-20-collaboration-platform-released/. Retrieved 2008-07-10. 
  26. ^ Michael Gerard, Seth Fishbein. "IDC CMO Advisory Best Practices Series: B-to-B Online and Interactive Marketing ... Cutting Through the Hype". IDC Research. http://www.idc.com/research/viewtoc.jsp;jsessionid=GBEYGVX245N4CCQJAFICFFAKBEAUMIWD?containerId=209923. Retrieved 2008-01-01. 
  27. ^ Anant Jhingran. "Information Management Communities". http://jhingran.typepad.com/anant_jhingrans_musings/2007/10/information-man.html. Retrieved 2008-05-05. 
  28. ^ "Melbourne university course on Data Warehousing". Melbourne University. http://www.dis.unimelb.edu.au/staff/gshanks/615644/. Retrieved 2008-05-05. 
  29. ^ "AIIM course on Enterprise 2.0". AIIM. http://www.aiim.org/documents/education/E20/E20Specialist.pdf. Retrieved 2009-02-05. 

[edit] External links

Retrieved from "http://en.wikipedia.org/wiki/BearingPoint"