Thursday, October 04, 2007

A new solution for outsourcing

Outsourcing, once the somewhat simple process of moving the entire back office of a major company to India or China, is getting more sophisticated. Firms are beginning to divide their offshore operations across continents, using near-shore locations in Central and Eastern Europe as a bridge between Western Europe and Asia.

Multinational companies like Infosys and Accenture are increasingly relying on the “cultural affinity” — mostly, language skills — of employees in their Czech outsourcing centers to shrink the distance between their large clients, with their hodgepodge of European languages, and an army of low-cost, English-speaking workers in India.

“We’ve designed some solutions for splitting tasks between two locations,” said Ratnesh Mathur, head of European operations at Infosys BPO, a division of the major Indian outsourcing company that focuses on back-office work such as accounting. “We do have live instances of a single process being worked on simultaneously from Brno” — where Mathur is based — “and Bangalore.”
Mathur cautioned that this kind of cross-country outsourcing can actually add additional overhead, in the form of coordination and supervision, unless a seamless IT solution is developed and customized for the particular task at hand.

Having such a streamlined method is important, confirmed Andrew Grech, head of the Prague operations of Accenture, the multinational outsourcing giant.

At its Prague outsourcing center, Accenture digitizes 25,000 invoices and receipts every month for an unnamed customer, a financial institution. The scanned images are archived and then sent to India, where office workers enter the data manually into the bank’s computer system.
“We are able to perform work in the most efficient manner possible,” Grech said. “Scanning [data], for instance, does not need to be done in the location in which it is processed.”
While some critics have raised concerns about sending important financial data to countries outside the European Union, these privacy concerns are mostly unfounded, Mathur said, and do not hinder companies working jointly between the Czech Republic and India, with a few exceptions.