Custom Software Development defines omitting of pre-developed (template or boxed) solutions and views. If a customer wants to believe that their favors is unique and putting their ideas into practice, they use their expert technologies and custom approaches to solving their problems. Development Companies are always into finding new creative decisions in order to meet the specific requirements and preferences of the customer as quickly as possible, so that they can be termed number one amongst the other custom software development companies.
A goal of company may be to develop not for the mass auditorium (users), but rather developed to be unique, for a single client (user) or a group. The custom software development services emphasizes on the most progressive technologies alone with preferences and expectations of the customer. Their custom software development services are designed in stage by stage processes, allowing all nuances and possible hidden dangers to be taken into account, including issues which may not be mentioned in the specifications.
Many Indian Companies, with their existing expert dedicated resources and years of quality experience are making its name in the field of custom software development. Their clients not only get world class resources at a very competitive price but also get access to the state of the art infrastructure. These days organizations are looking to outsource their work, because they don’t want to loose effective time spending it on non-core jobs. Thus, being a custom software development company, give a lot importance to cost effectiveness, time frame, security, infrastructure and expertise and control. These are the vital points while choosing the right company, providing with the right services.
Companies can reduce the overhead commonly associated with offshore outsourcing of custom software application development by providing:
Efficiency: Their services and production processes allows a shortened time-to-market delivery at a benefit to their clients by reducing total cost.
Predictability: Their clients come out on top! Their production services combined with a commitment to a fixed-price quote and production estimation ensures total quality with added value in their custom software development solutions.
Process visibility: By outsourcing your software and custom software application development processes with them; they maintain a transparent and controllable visibility at all phases of the project.
Effective communication: They ensure that during each stage of the project, all stakeholders share a consistent and open dialog maintaining a level of understanding of the requirements and project status.
Initially outsourcing custom software development work might seem a costlier choice, but with time Rapid soft Technologies has proved that the price difference is deceptive as the variation is only in the initial cost. In the long run the overall cost will prove to be much lower when you work with them.
Source: Articlesbase.com
Tuesday, July 29, 2008
Monday, July 28, 2008
Outsourcers Hone European Savvy
BANGALORE, India -- On the campus of Infosys Technologies Ltd. here, a group of engineers recently learned the basics of French dining etiquette: Always stand when a woman enters the room, never put your elbows on the table and, most important, don't discuss business during the meal.
Indubala Ashok lectures a class of TCS programmers on the 'do's' and 'don'ts' of communicating with German clients.
Infosys and India's other big outsourcing companies are gambling that such knowledge could make the difference between their success and failure in Europe. Although the engineers tutored in French table manners are likely to stay in India, they soon will be working for European clients. Infosys hopes a better understanding of European culture will help them communicate with their new bosses.
As the U.S. economy slows and the dollar weakens, India's outsourcing industry, which has prospered running call centers and doing back-office jobs for U.S. companies, is increasingly looking to Europe.
Indian outsourcing companies generally have a harder time running customer-service and call-center businesses in Europe than they do in the U.S., where India's large English-speaking population is a major asset. Still, Europe is a huge potential market for their technology-related services, such as computer programming, and other services, such as processing bills. So far, Infosys and its rivals have managed to tap just a fraction of that potential.
That may not change much anytime soon. Labor wields considerable clout in many European countries, and worker-protection laws there make it harder than in the U.S. for companies to move jobs offshore.
As a result, Tata Consultancy Services Ltd., India's largest outsourcing company by sales, generates just 10% of its $5.8 billion in revenue from continental Europe, mostly from Germany, Belgium, the Netherlands, Luxembourg and the Nordic countries. Wipro Ltd. puts the Continent's contribution to its revenue at 15%. By contrast, both companies get more than 50% of their revenue from North America.
Source: online.wsj.com
Indubala Ashok lectures a class of TCS programmers on the 'do's' and 'don'ts' of communicating with German clients.
Infosys and India's other big outsourcing companies are gambling that such knowledge could make the difference between their success and failure in Europe. Although the engineers tutored in French table manners are likely to stay in India, they soon will be working for European clients. Infosys hopes a better understanding of European culture will help them communicate with their new bosses.
As the U.S. economy slows and the dollar weakens, India's outsourcing industry, which has prospered running call centers and doing back-office jobs for U.S. companies, is increasingly looking to Europe.
Indian outsourcing companies generally have a harder time running customer-service and call-center businesses in Europe than they do in the U.S., where India's large English-speaking population is a major asset. Still, Europe is a huge potential market for their technology-related services, such as computer programming, and other services, such as processing bills. So far, Infosys and its rivals have managed to tap just a fraction of that potential.
That may not change much anytime soon. Labor wields considerable clout in many European countries, and worker-protection laws there make it harder than in the U.S. for companies to move jobs offshore.
As a result, Tata Consultancy Services Ltd., India's largest outsourcing company by sales, generates just 10% of its $5.8 billion in revenue from continental Europe, mostly from Germany, Belgium, the Netherlands, Luxembourg and the Nordic countries. Wipro Ltd. puts the Continent's contribution to its revenue at 15%. By contrast, both companies get more than 50% of their revenue from North America.
Source: online.wsj.com
How Offshore Outsourcing Affects Customer Satisfaction
The outsourcing of customer service to offshore providers has gotten a lot of bad press in the U.S., with reports citing language problems and the exporting of jobs. But, despite the potential for such reports to alienate consumers, this offshoring continues to grow, driven mainly by the lower labor costs overseas.
Are companies that send customer service abroad making a mistake? It's hard to answer that question without knowing offshoring's actual impact on customer satisfaction.
Our research indicates the effect in most cases is significantly negative -- but similar to the effect of outsourcing customer service domestically. That suggests companies shouldn't necessarily forgo the savings they can reap from offshoring. But if they're going to do it, they'd better do it right.
Negative Numbers
We analyzed the offshoring and outsourcing activities of 150 North American companies and business units from 1998 to 2006. As a group, those that outsourced customer service saw a drop in their score on the American Consumer Satisfaction Index, or ACSI, a measure created by the National Quality Research Center at the University of Michigan. The declines were roughly the same whether companies outsourced customer service domestically or overseas.
ACSI scores tend to move in the same direction as companies' share prices. Based on the historical data showing that connection, the average ACSI decline we found at companies outsourcing customer service is associated with a drop of roughly 1% to 5% in a company's market capitalization, depending on what industry the company is in.
That's a steep price to pay. But there are ways to make outsourced customer service more palatable to customers or to mitigate its negative effects, and in some respects that may be easier to do with offshoring. And there are offshoring alternatives that can save a company money without damaging its relationship with its customers.
An important step companies can take to improve the quality of outsourced customer service is to ensure that the provider has all the information necessary to help the customer and full authority to do so. Sometimes, because a company wants to protect information about its customers, the customer-service provider isn't given complete customer histories and profiles. Or the provider's authority to resolve complaints is limited; for instance, the provider may not be permitted to grant credits to customers. Companies need to weigh their concerns about information security and financial control against the damage that such arrangements can do to customer satisfaction.
Tapping Technology
Companies can also make customer service more effective by taking advantage of the technological innovations that some providers offer, and here there may sometimes be an advantage in offshore. That's because some foreign outsourcing providers have offerings their domestic counterparts can't match in terms of technologies that help guide customer service by recognizing patterns in consumer behavior.
One way to mitigate the damage from outsourcing customer service is to invest the money the company saves to improve the quality of the company's products or services, or to cut prices, rather than simply pocket the savings as extra profit. Our findings suggest that this isn't happening in most cases. Among the companies we studied that had outsourced customer service, there was no increase in the perceived-value component of their overall customer-satisfaction score: Their customers didn't feel that they were getting any more for their money than they did before the company started outsourcing.
Here again there may be an advantage in offshoring. If a company can save more by sending customer service overseas, it will have more opportunity to devote at least some of that money to upgrading its business.
In addition to considering whether or not to offshore customer service, companies should consider whether back-office functions such as information technology may be suitable for offshoring. Our study found that back-office offshoring had no effect on overall customer satisfaction. So the savings a company garners this way aren't offset by dissatisfaction among customers.
Source: Online.wsj.com
Are companies that send customer service abroad making a mistake? It's hard to answer that question without knowing offshoring's actual impact on customer satisfaction.
Our research indicates the effect in most cases is significantly negative -- but similar to the effect of outsourcing customer service domestically. That suggests companies shouldn't necessarily forgo the savings they can reap from offshoring. But if they're going to do it, they'd better do it right.
Negative Numbers
We analyzed the offshoring and outsourcing activities of 150 North American companies and business units from 1998 to 2006. As a group, those that outsourced customer service saw a drop in their score on the American Consumer Satisfaction Index, or ACSI, a measure created by the National Quality Research Center at the University of Michigan. The declines were roughly the same whether companies outsourced customer service domestically or overseas.
ACSI scores tend to move in the same direction as companies' share prices. Based on the historical data showing that connection, the average ACSI decline we found at companies outsourcing customer service is associated with a drop of roughly 1% to 5% in a company's market capitalization, depending on what industry the company is in.
That's a steep price to pay. But there are ways to make outsourced customer service more palatable to customers or to mitigate its negative effects, and in some respects that may be easier to do with offshoring. And there are offshoring alternatives that can save a company money without damaging its relationship with its customers.
An important step companies can take to improve the quality of outsourced customer service is to ensure that the provider has all the information necessary to help the customer and full authority to do so. Sometimes, because a company wants to protect information about its customers, the customer-service provider isn't given complete customer histories and profiles. Or the provider's authority to resolve complaints is limited; for instance, the provider may not be permitted to grant credits to customers. Companies need to weigh their concerns about information security and financial control against the damage that such arrangements can do to customer satisfaction.
Tapping Technology
Companies can also make customer service more effective by taking advantage of the technological innovations that some providers offer, and here there may sometimes be an advantage in offshore. That's because some foreign outsourcing providers have offerings their domestic counterparts can't match in terms of technologies that help guide customer service by recognizing patterns in consumer behavior.
One way to mitigate the damage from outsourcing customer service is to invest the money the company saves to improve the quality of the company's products or services, or to cut prices, rather than simply pocket the savings as extra profit. Our findings suggest that this isn't happening in most cases. Among the companies we studied that had outsourced customer service, there was no increase in the perceived-value component of their overall customer-satisfaction score: Their customers didn't feel that they were getting any more for their money than they did before the company started outsourcing.
Here again there may be an advantage in offshoring. If a company can save more by sending customer service overseas, it will have more opportunity to devote at least some of that money to upgrading its business.
In addition to considering whether or not to offshore customer service, companies should consider whether back-office functions such as information technology may be suitable for offshoring. Our study found that back-office offshoring had no effect on overall customer satisfaction. So the savings a company garners this way aren't offset by dissatisfaction among customers.
Source: Online.wsj.com
Friday, July 25, 2008
Offshore outsourcing: current state of affairs and future trends in Europe
The 2008 survey questioned more than 600 decision-makers of the largest European companies with a turnover of at least 100 million euros. The survey came up with the following findings:
1. 70% of respondents reported outsourcing at least one business process to lower-cost countries;
2. 49% of respondents agreed that offshore outsourcing served as an efficient cost saving tool;
3. 33% pointed to better quality through hiring the specialists among the major reasons for outsourcing;
4. Computing / telecommunications (68%) along with maintenance (76%) and logistics (73%) are the largest outsourcing segments;
5. Belgium was found to have the highest outsourcing rate (81% of companies), while France was found to have the lowest take-up rate at 63%;
6. At the industry level, the finance industry is reported to be the most mature in adopting outsourcing; banking is considered to be the most focused on IT and telecommunications outsourcing with a 75% take-up rate;
7. Medium-sized companies and multinationals are the major users of offshore outsourcing;
8. The majority of respondents generally report positive experience they have had with offshore outsourcing.
9. 20% of European companies admitted intending to increase their outsourcing level within the next two years.
According to Ernst & Young, the main reason why offshore outsourcing is expected to grow in the next two years is competing in the global economy and dealing with a strong Euro. The traditionally vertically integrated business processes are expected to be fragmented to allow European business and industry players to increase their profits and scalability. Outsourcing, serving as an efficient fragmentation tool, has proved to be very successful in delivering absolute competence to each element of the existing value chain.
TEAM’s own analytical experience fully confirms the findings of the 2008 Ernst & Young survey. In today’s business world many Western European countries choose to offload their processes to Eastern Europe for the purpose of saving costs and increasing the level of competitiveness.
Another important finding of Ernst & Young is that many respondents point to poor communication between a vendor and a client as a main obstacle in the way of effective outsourcing partnerships. Realizing that improved communication with clients is one of the key paths to success, TEAM International recognizes and established close relationships with each client regardless of its size and project scope.
1. 70% of respondents reported outsourcing at least one business process to lower-cost countries;
2. 49% of respondents agreed that offshore outsourcing served as an efficient cost saving tool;
3. 33% pointed to better quality through hiring the specialists among the major reasons for outsourcing;
4. Computing / telecommunications (68%) along with maintenance (76%) and logistics (73%) are the largest outsourcing segments;
5. Belgium was found to have the highest outsourcing rate (81% of companies), while France was found to have the lowest take-up rate at 63%;
6. At the industry level, the finance industry is reported to be the most mature in adopting outsourcing; banking is considered to be the most focused on IT and telecommunications outsourcing with a 75% take-up rate;
7. Medium-sized companies and multinationals are the major users of offshore outsourcing;
8. The majority of respondents generally report positive experience they have had with offshore outsourcing.
9. 20% of European companies admitted intending to increase their outsourcing level within the next two years.
According to Ernst & Young, the main reason why offshore outsourcing is expected to grow in the next two years is competing in the global economy and dealing with a strong Euro. The traditionally vertically integrated business processes are expected to be fragmented to allow European business and industry players to increase their profits and scalability. Outsourcing, serving as an efficient fragmentation tool, has proved to be very successful in delivering absolute competence to each element of the existing value chain.
TEAM’s own analytical experience fully confirms the findings of the 2008 Ernst & Young survey. In today’s business world many Western European countries choose to offload their processes to Eastern Europe for the purpose of saving costs and increasing the level of competitiveness.
Another important finding of Ernst & Young is that many respondents point to poor communication between a vendor and a client as a main obstacle in the way of effective outsourcing partnerships. Realizing that improved communication with clients is one of the key paths to success, TEAM International recognizes and established close relationships with each client regardless of its size and project scope.
Source: Itworld.com
Monday, July 21, 2008
Indian outsourcers feeling the pinch
India's outsourcing giants suffered sluggish growth in contrast to record-breaking spending on global services in 2008.
The country's big three outsourcers Infosys, Tata Consultancy Services (TCS) and Wipro experienced slow revenue or income growth in their just-announced first quarter results for the period ended 30 June.
The results fly in the face of figures in the quarterly index by outsourcing adviser TPI, which showed global spending on outsourcing is on track to break records in 2008, with Europe forging the biggest contracts.
All three of the Indian outsourcers blamed challenging global economic conditions, with Infosys warning the next quarter may continue to be difficult as companies postponed decisions on outsourcing.
Wipro experienced a rise in profits of 15 per cent over the same period last year - growing to 8.14bn Indian Rupees ($US187.5m) - but putting it below the 16 per cent growth in the first quarter of 2007.
Infosys reported revenue of $US1.16bn - up 24.5 per cent on the same period last year but falling short of the 40.6 per cent growth in the first quarter of 2007. TCS' profit was up just two per cent to $US296m - lower than the 55 per cent rise for the same period in 2007.
Meanwhile TPI's index found that companies signed $US25.6bn of outsourcing contracts in the second quarter of 2008 - the third quarter in a row to break the $US20bn mark and the best recorded performance of three consecutive quarters.
TPI says this year is on track to realise the highest total contract value (TCV) for outsourcing deals on record.
Value grew fastest in Europe, with 58 per cent more TCV in the first half of 2008 compared to the same period last year, accounting for 10 of the 13 $US1bn-plus contracts.
A total of 146 contracts were signed in the second quarter, leading to one of the strongest first halves in more than a decade, with 282 contracts valued at nearly $US49bn in TCV, and nearly $10bn in annualised contract value.
Peter Allen, partner and managing director of TPI, said in a statement: "Companies across industry segments are expressing their concerns regarding the uncertain business conditions by taking steps to reduce operational costs, and the outsourcing industry is benefiting."
The country's big three outsourcers Infosys, Tata Consultancy Services (TCS) and Wipro experienced slow revenue or income growth in their just-announced first quarter results for the period ended 30 June.
The results fly in the face of figures in the quarterly index by outsourcing adviser TPI, which showed global spending on outsourcing is on track to break records in 2008, with Europe forging the biggest contracts.
All three of the Indian outsourcers blamed challenging global economic conditions, with Infosys warning the next quarter may continue to be difficult as companies postponed decisions on outsourcing.
Wipro experienced a rise in profits of 15 per cent over the same period last year - growing to 8.14bn Indian Rupees ($US187.5m) - but putting it below the 16 per cent growth in the first quarter of 2007.
Infosys reported revenue of $US1.16bn - up 24.5 per cent on the same period last year but falling short of the 40.6 per cent growth in the first quarter of 2007. TCS' profit was up just two per cent to $US296m - lower than the 55 per cent rise for the same period in 2007.
Meanwhile TPI's index found that companies signed $US25.6bn of outsourcing contracts in the second quarter of 2008 - the third quarter in a row to break the $US20bn mark and the best recorded performance of three consecutive quarters.
TPI says this year is on track to realise the highest total contract value (TCV) for outsourcing deals on record.
Value grew fastest in Europe, with 58 per cent more TCV in the first half of 2008 compared to the same period last year, accounting for 10 of the 13 $US1bn-plus contracts.
A total of 146 contracts were signed in the second quarter, leading to one of the strongest first halves in more than a decade, with 282 contracts valued at nearly $US49bn in TCV, and nearly $10bn in annualised contract value.
Peter Allen, partner and managing director of TPI, said in a statement: "Companies across industry segments are expressing their concerns regarding the uncertain business conditions by taking steps to reduce operational costs, and the outsourcing industry is benefiting."
Source : Click
Friday, July 18, 2008
IT Outsourcing Challenges and Solutions
Over the last 10 years IT Application outsourcing with off shoring has been growing in size and volume, an indication that organizations have been benefiting from outsourcing. However, there are projects and deals that have been rolled back and organizations have been hurt due to vendor's inability to deliver quality product on time. This article addresses how organization can do an effective IT application outsourcing and not get trapped into standard headcount replacement by cheap labor pool. The article brings out perspective from the Authors; Vendor manager has worked for 12 years for outsourcing companies, managed large teams/project for outsourcing vendors and the customer who has championed outsourcing successfully in his organization. The article brings out the challenges that IT organizations face today in outsourcing effectively and successfully and how can they address these challenges.
A business will always try to produce at the least cost and sell it at the highest cost to maximize the return to promoters/stakeholders. No wonder that outsourcing in some form has always been present since ancient time when people traded goods or services. In the modern times, with communication cost coming down and availability of large pool of educated labor force in a developing country, IT application outsourcing with off shoring started to take place. The application outsourcing started with Year 2000 problem in a big way when industry ran out of resources and a problem that needed attention before the time ran out. Over the time, outsourcing vendors based out of India have established themselves and have grown in size many folds (The employee strength of Infosys's # rose from 1100 in 1996 to 91,187 in 2008 Apr, the figure for TCS is 3000 to 111,407 in 12 years, and for Wipro 3000+ to 82,122) and along the line have built credibility and capability to deliver large projects as well. The number indicates that outsourcing in general is working. Let us look at closely what are the challenges that IT organizations face with outsourcing, how it impacts them and what they can do to address these issues.
Current IT Projects are more complex compared to Year 2000 projects - Year 2000 projects were simple in nature. One would just review the source code base offshore and provide the fix. Completing these projects didn't require writing new software or working with new technologies. Nor did it require the domain or application knowledge.
All projects today however require working with new technologies, deep domain knowledge, other interfacing application knowledge and experienced staff. While IT vendors have done a good job of training their personnel in new technologies, but biggest problem faced today is lack of personnel with requisite knowledge as there is high attrition among these skilled labor.
IT vendors have tried to answer some of these problems by having vertical units aligned to a particular segment of the business and specialized domain within the same. However this also doesn't solve the problem as these trained people would not have enough knowledge of an organization's application landscape and domain.
One of the ways in which IT organizations can address these challenges is by training their employees on new technologies. These employees who already know application and adding domain experience will make them subject matter expert in a short time... CIO and senior management should plan to have trained employees in each technology and each application. IT organization can form center of excellence within organization for different technologies and identify key personnel to meet the organization's requirements. Center of excellence can be around technologies (J2EE, Mainframe, Reporting, and EDI) as well as around business processes. Team members from Center of Excellence (CoE) should play key roles as lead or architect on large projects.
Source : Click
A business will always try to produce at the least cost and sell it at the highest cost to maximize the return to promoters/stakeholders. No wonder that outsourcing in some form has always been present since ancient time when people traded goods or services. In the modern times, with communication cost coming down and availability of large pool of educated labor force in a developing country, IT application outsourcing with off shoring started to take place. The application outsourcing started with Year 2000 problem in a big way when industry ran out of resources and a problem that needed attention before the time ran out. Over the time, outsourcing vendors based out of India have established themselves and have grown in size many folds (The employee strength of Infosys's # rose from 1100 in 1996 to 91,187 in 2008 Apr, the figure for TCS is 3000 to 111,407 in 12 years, and for Wipro 3000+ to 82,122) and along the line have built credibility and capability to deliver large projects as well. The number indicates that outsourcing in general is working. Let us look at closely what are the challenges that IT organizations face with outsourcing, how it impacts them and what they can do to address these issues.
Current IT Projects are more complex compared to Year 2000 projects - Year 2000 projects were simple in nature. One would just review the source code base offshore and provide the fix. Completing these projects didn't require writing new software or working with new technologies. Nor did it require the domain or application knowledge.
All projects today however require working with new technologies, deep domain knowledge, other interfacing application knowledge and experienced staff. While IT vendors have done a good job of training their personnel in new technologies, but biggest problem faced today is lack of personnel with requisite knowledge as there is high attrition among these skilled labor.
IT vendors have tried to answer some of these problems by having vertical units aligned to a particular segment of the business and specialized domain within the same. However this also doesn't solve the problem as these trained people would not have enough knowledge of an organization's application landscape and domain.
One of the ways in which IT organizations can address these challenges is by training their employees on new technologies. These employees who already know application and adding domain experience will make them subject matter expert in a short time... CIO and senior management should plan to have trained employees in each technology and each application. IT organization can form center of excellence within organization for different technologies and identify key personnel to meet the organization's requirements. Center of excellence can be around technologies (J2EE, Mainframe, Reporting, and EDI) as well as around business processes. Team members from Center of Excellence (CoE) should play key roles as lead or architect on large projects.
Source : Click
Thursday, July 17, 2008
Outsourcing the Offshore Operations
Western companies are increasingly getting away from running their own offshoring operations, handing the jobs over to Indian tech-services specialists
A monumental shift in how Western corporations tap into Indian talent is taking place. Companies are moving away from running their own offshoring operations and handing at least some of those jobs to Indian tech-services specialists.
The most recent sign of the sea change came July 10, when British insurance giant Aviva (AV) said it sold a 5,000-strong South Asian outsourcing operation to WNS Global Services (WNS) of Mumbai. WNS paid $228 million for these so-called captive operations in Bangalore, Pune, Chennai, and Colombo, Sri Lanka. In return, Aviva agreed to pay up to $1 billion to WNS over more than eight years for handling customer service, account setup, accounting, and claims processing.
There has been a steady drumbeat of similar large deals in recent years, but industry executives and analysts say the pace is quickening—driven by currency swings, the increased costs of doing business in India, and the need for some Western financial services to raise cash to handle shortfalls elsewhere. "The writing is on the wall," says Sudin Apte, an analyst at market researcher Forrester Research (FORR). "This is not working anymore."
Labor Savings Aren't Enough
Apte estimates more than 150 companies have shifted in the past few years from running captive operations to using a mix of internally run and outsourced operations. He expects another 80 to 100 companies will make the move in the next year or so. In an April report, his survey of 59 corporate information technology executives showed 22% of them plan to stick with captive operations while 66% will use outsourcing companies in whole or part. That's a huge shift from the results of a survey at the end of 2005, when 55% of respondents said they'd run their own offshore operations.
A lot has changed since 2005. For one, many of the captive operations have swelled in size and have staffs numbering 3,000 to 6,000. Apte and other analysts believe offshoring outfits that large are hard for parent companies to operate efficiently. In many cases, it's better to hand the business to outsourcing firms that have even larger-scale operations and can move employees from one project to another as the needs of a large customer base shift. The other major change is that the rising costs of doing business in India mean it no longer makes sense to move work there just for the labor-cost reductions. To pay off big-time, these shifts must include gains in productivity through process improvements and innovation that the top Indian outsourcing companies have mastered.
Other notable handoffs include the 2007 Infosys acquisition of Philips Electronics' business process outsourcing (BPO) operations in India, Thailand, and Poland; and the 2006 joint venture formed between Tata Consulting Services (TCS.BO) and Britain insurer Pearl Group. General Electric (GE) gave the trend a lot of momentum in 2005 by spinning out its Indian back-shop operations as Genpact in 2005. WNS itself was formed six years ago as a spinout from British Airways (BAY.L).
Economies of Scale
The Aviva deal gives WNS a chance to get bigger fast. The BPO specialist now has 22,000 employees. WNS bested a handful of other bidders. "This is a very sizable piece of business that makes us a company of a different scale," says WNS chairman Ramesh Shah. "We understood the business, and we wanted to have a long-term relationship with them."
Aviva had pioneered the strategy of hiring Indian outsourcing specialists to set up and temporarily run operations and then pass them off to Aviva. It was new to the market and figured it could benefit from the expertise of local players. WNS was one of its partners. But last year it reviewed its options and decided to reverse the way it does things. In a time of volatile currency and salary shifts, Aviva sought more predictable costs. Also, it believes WNS can wring more costs from its operations. "These companies have been better than corporations at driving efficiencies because they're specialists in the area," says Cathryn Riley, chairman of Aviva Global Services. She says the company is as committed as ever to having much of its work done in India, in spite of rising costs.
One of the advantages the Indian firms bring is their sheer size. Infosys, for instance, now has nearly 100,000 employees and plans to hire another 10,000 this quarter alone. These companies have hundreds of customers they can serve from their large delivery centers, using standard technologies and business practices.
A wild card in the shift from captive offshoring operations is the problems of big Western banks. Hard up for funds as a result of their mismanagement of real estate finances, they need cash. But analysts and executives caution that these firms may not be able to get the kind of money they're looking for by selling Indian operations, mainly because the Indians typically drive a hard bargain. "Sometimes the price is too high for us," says Kris Gopalakrishnan, chief executive at Infosys, which is now looking at two potential banking deals.
But Forrester's Apte believes the banks may eventually be forced to sell out even if it means settling for less. "Their desperation is going to grow," he says.
Source : Click
A monumental shift in how Western corporations tap into Indian talent is taking place. Companies are moving away from running their own offshoring operations and handing at least some of those jobs to Indian tech-services specialists.
The most recent sign of the sea change came July 10, when British insurance giant Aviva (AV) said it sold a 5,000-strong South Asian outsourcing operation to WNS Global Services (WNS) of Mumbai. WNS paid $228 million for these so-called captive operations in Bangalore, Pune, Chennai, and Colombo, Sri Lanka. In return, Aviva agreed to pay up to $1 billion to WNS over more than eight years for handling customer service, account setup, accounting, and claims processing.
There has been a steady drumbeat of similar large deals in recent years, but industry executives and analysts say the pace is quickening—driven by currency swings, the increased costs of doing business in India, and the need for some Western financial services to raise cash to handle shortfalls elsewhere. "The writing is on the wall," says Sudin Apte, an analyst at market researcher Forrester Research (FORR). "This is not working anymore."
Labor Savings Aren't Enough
Apte estimates more than 150 companies have shifted in the past few years from running captive operations to using a mix of internally run and outsourced operations. He expects another 80 to 100 companies will make the move in the next year or so. In an April report, his survey of 59 corporate information technology executives showed 22% of them plan to stick with captive operations while 66% will use outsourcing companies in whole or part. That's a huge shift from the results of a survey at the end of 2005, when 55% of respondents said they'd run their own offshore operations.
A lot has changed since 2005. For one, many of the captive operations have swelled in size and have staffs numbering 3,000 to 6,000. Apte and other analysts believe offshoring outfits that large are hard for parent companies to operate efficiently. In many cases, it's better to hand the business to outsourcing firms that have even larger-scale operations and can move employees from one project to another as the needs of a large customer base shift. The other major change is that the rising costs of doing business in India mean it no longer makes sense to move work there just for the labor-cost reductions. To pay off big-time, these shifts must include gains in productivity through process improvements and innovation that the top Indian outsourcing companies have mastered.
Other notable handoffs include the 2007 Infosys acquisition of Philips Electronics' business process outsourcing (BPO) operations in India, Thailand, and Poland; and the 2006 joint venture formed between Tata Consulting Services (TCS.BO) and Britain insurer Pearl Group. General Electric (GE) gave the trend a lot of momentum in 2005 by spinning out its Indian back-shop operations as Genpact in 2005. WNS itself was formed six years ago as a spinout from British Airways (BAY.L).
Economies of Scale
The Aviva deal gives WNS a chance to get bigger fast. The BPO specialist now has 22,000 employees. WNS bested a handful of other bidders. "This is a very sizable piece of business that makes us a company of a different scale," says WNS chairman Ramesh Shah. "We understood the business, and we wanted to have a long-term relationship with them."
Aviva had pioneered the strategy of hiring Indian outsourcing specialists to set up and temporarily run operations and then pass them off to Aviva. It was new to the market and figured it could benefit from the expertise of local players. WNS was one of its partners. But last year it reviewed its options and decided to reverse the way it does things. In a time of volatile currency and salary shifts, Aviva sought more predictable costs. Also, it believes WNS can wring more costs from its operations. "These companies have been better than corporations at driving efficiencies because they're specialists in the area," says Cathryn Riley, chairman of Aviva Global Services. She says the company is as committed as ever to having much of its work done in India, in spite of rising costs.
One of the advantages the Indian firms bring is their sheer size. Infosys, for instance, now has nearly 100,000 employees and plans to hire another 10,000 this quarter alone. These companies have hundreds of customers they can serve from their large delivery centers, using standard technologies and business practices.
A wild card in the shift from captive offshoring operations is the problems of big Western banks. Hard up for funds as a result of their mismanagement of real estate finances, they need cash. But analysts and executives caution that these firms may not be able to get the kind of money they're looking for by selling Indian operations, mainly because the Indians typically drive a hard bargain. "Sometimes the price is too high for us," says Kris Gopalakrishnan, chief executive at Infosys, which is now looking at two potential banking deals.
But Forrester's Apte believes the banks may eventually be forced to sell out even if it means settling for less. "Their desperation is going to grow," he says.
Source : Click
Wednesday, July 16, 2008
Outsourcing, Layoffs Lead to End of Tax Breaks at Nielsen
Source : Click
IT offshoring deal leads to layoffs at ratings giant's global technology center.
The Nielsen Co. is giving up tax breaks that have netted it $1.4 million since 2001, in response to political fallout from an IT offshoring deal that has led to layoffs at its global technology center in Oldsmar, Fla.
Nielsen, which is best known for measuring TV audiences, began getting the tax breaks after agreeing to build the $100 million facility in Oldsmar, west of Tampa. The incentives were pegged to the number of jobs paying at least $52,000 annually at the tech center, which had about 1,200 employees at first and grew its workforce to 1,700.
In addition to the $1.4 million in tax breaks that Nielsen has received from the Oldsmar and Pinellas County governments, the company got $1.7 million from the state under an incentive program that has expired. The local incentives, though, were scheduled to continue until 2016.
But then last October, Nielsen announced a 10-year, $1.2 billion outsourcing agreement with India-based Tata Consultancy Services Ltd. That move was followed in April by the news that 117 people at the Oldsmar tech center would be laid off.
Although 50 of those employees have since been hired by Tata, Nielsen late last month said that it was cutting another 170 jobs in Oldsmar -- and that some of the affected workers are training Tata employees to do their work. The company now expects to have about 1,300 employees at the facility by year's end, plus 250 or so contract workers.
Gary Holmes, a spokesman for Nielsen, said the company decided to pull out of the tax-break program after members of the Oldsmar city council expressed "second thoughts about the agreement" because of the layoffs. "It became kind of an emotional issue," he said.
That's evident from the minutes of a council meeting held in April. One member accused Nielsen, the city's largest employer, of "making a joke of the tax- incentive program," while another said the company "had abdicated [its] responsibility as a corporate citizen."
Despite the layoffs, the incentive deal "did everything it was intended to do," said Mike Meidel, director of Pinellas County Economic Development. Nielsen could have built its technology center somewhere else, Meidel said, adding that the company still has enough employees in Oldsmar to qualify for the tax breaks.
The Nielsen Co. is giving up tax breaks that have netted it $1.4 million since 2001, in response to political fallout from an IT offshoring deal that has led to layoffs at its global technology center in Oldsmar, Fla.
Nielsen, which is best known for measuring TV audiences, began getting the tax breaks after agreeing to build the $100 million facility in Oldsmar, west of Tampa. The incentives were pegged to the number of jobs paying at least $52,000 annually at the tech center, which had about 1,200 employees at first and grew its workforce to 1,700.
In addition to the $1.4 million in tax breaks that Nielsen has received from the Oldsmar and Pinellas County governments, the company got $1.7 million from the state under an incentive program that has expired. The local incentives, though, were scheduled to continue until 2016.
But then last October, Nielsen announced a 10-year, $1.2 billion outsourcing agreement with India-based Tata Consultancy Services Ltd. That move was followed in April by the news that 117 people at the Oldsmar tech center would be laid off.
Although 50 of those employees have since been hired by Tata, Nielsen late last month said that it was cutting another 170 jobs in Oldsmar -- and that some of the affected workers are training Tata employees to do their work. The company now expects to have about 1,300 employees at the facility by year's end, plus 250 or so contract workers.
Gary Holmes, a spokesman for Nielsen, said the company decided to pull out of the tax-break program after members of the Oldsmar city council expressed "second thoughts about the agreement" because of the layoffs. "It became kind of an emotional issue," he said.
That's evident from the minutes of a council meeting held in April. One member accused Nielsen, the city's largest employer, of "making a joke of the tax- incentive program," while another said the company "had abdicated [its] responsibility as a corporate citizen."
Despite the layoffs, the incentive deal "did everything it was intended to do," said Mike Meidel, director of Pinellas County Economic Development. Nielsen could have built its technology center somewhere else, Meidel said, adding that the company still has enough employees in Oldsmar to qualify for the tax breaks.
Tuesday, July 15, 2008
Software Associates Breaks Into Australian Market
Source : Click
Software Associates Breaks Into Australian Export Market With Wireless Barcode Scanning System For Warehouses
Software Associates, one of New Zealand’s fastest growing information technology specialists, has started exporting an innovative warehouse management product to Australia. Independent Distillers Group, a major manufacturer and distributor of alcoholic beverages, is the first organisation to have implemented the solution, with the system now operating at their Melbourne and Sydney facilities.
The solution utilises the dcLINK wireless data capture system from Software Associates strategic partner, Data Systems International (DSI). A pivotal step was integrating dcLINK with IDA’s comprehensive business management solution, Microsoft Dynamics AX. Both products are well established globally, however integrating the two was a world first, using technology developed by Software Associates.
Initial feedback from IDA has been positive. Group Business Analyst at Independent Distillers, Crystal Chan, says:
‘The hardware, software and process framework that Software Associates has provided us with has significantly streamlined warehouse product handling. I am sure that we will be much more productive, profitable and efficient now that we are able to track inventory using bar code scanning and mobile application technology.’
Michael Harrod, Operations Manager at Software Associates, agrees:
‘Previously, IDA was entering data manually from paper which is time consuming and inefficient. The new system will help reduce costs and improve profitability. Efficiency, accuracy and visibility will all be much improved.
‘We are extremely proud of the results that we have achieved for IDA and look forward to helping other businesses across Australasia.’
Software Associates, one of New Zealand’s fastest growing information technology specialists, has started exporting an innovative warehouse management product to Australia. Independent Distillers Group, a major manufacturer and distributor of alcoholic beverages, is the first organisation to have implemented the solution, with the system now operating at their Melbourne and Sydney facilities.
The solution utilises the dcLINK wireless data capture system from Software Associates strategic partner, Data Systems International (DSI). A pivotal step was integrating dcLINK with IDA’s comprehensive business management solution, Microsoft Dynamics AX. Both products are well established globally, however integrating the two was a world first, using technology developed by Software Associates.
Initial feedback from IDA has been positive. Group Business Analyst at Independent Distillers, Crystal Chan, says:
‘The hardware, software and process framework that Software Associates has provided us with has significantly streamlined warehouse product handling. I am sure that we will be much more productive, profitable and efficient now that we are able to track inventory using bar code scanning and mobile application technology.’
Michael Harrod, Operations Manager at Software Associates, agrees:
‘Previously, IDA was entering data manually from paper which is time consuming and inefficient. The new system will help reduce costs and improve profitability. Efficiency, accuracy and visibility will all be much improved.
‘We are extremely proud of the results that we have achieved for IDA and look forward to helping other businesses across Australasia.’
Saturday, July 12, 2008
Reduce Time-to-Market Through Innovation in Outsourcing
Source : Click
Partnering With R&D Providers to Achieve Innovation, Decrease Cycle-Time, and Significantly Reduce the Time It Takes to Get Your Products to the Market
In the newly released benchmark report, "Software Development and Innovation: Speeding 'Time-to-Market,'" Aberdeen Group, a Harte-Hanks Company found that Best-in-Class organizations realized an 18% decrease in time-to-market as a result of their R&D / Engineering Outsourcing engagement -- a rate that is over 26x greater than Industry Average organizations.
This report examined and analyzed organizations' planning, deployment, use, and management of Research and Development (R&D) and Engineering Outsourcing to provide a roadmap for constructing the internal framework necessary for a successful outsourcing relationship. As part of their outsourcing strategy, Best-in-Class organizations determined and allocated the proper amount of internal resources, incorporated clearly defined Service Level Agreements (SLAs), utilized a variety of analysis and measuring tools, and essentially viewed their outsourcing partner as an extension of their internal R&D team to achieve product differentiation and expedited time-to-market. In fact, Best-in-Class organizations are 123% more likely than Laggards to ensure their outsourcing provider has "skin in the game." By viewing the outsourcing engagement as a value partnership rather than merely and employee-contractor relationship, most often accomplished by contractually stipulating that both the outsourcer and outsourcing provider have a financial stake in meeting and exceeding project objectives, Best-in-Class organizations experienced an 18% increase in research productivity / efficiency, as well as a 13% increase in customer satisfaction.
"R&D and engineering outsourcing is most effective when organizations choose partners that share the business-critical mindset about the work they are performing," said Ralph Rodriguez, Senior Vice-President of Research, Technology Markets group. "In R&D it is especially relevant that delivery teams leverage deep knowledge to develop insights and find new ways to add continually value through the communication and application of their professional expertise."
The report educates end users on how Best-in-Class organizations are developing and managing their outsourcing initiatives as compared to others, and recommends clear actions to improve end user satisfaction and increase their ROI through the correct blend of capabilities, policies, and procedures. SLA management, internal structuring, monitoring and optimization tools, as well as other key performance indicators are reviewed.
In the newly released benchmark report, "Software Development and Innovation: Speeding 'Time-to-Market,'" Aberdeen Group, a Harte-Hanks Company found that Best-in-Class organizations realized an 18% decrease in time-to-market as a result of their R&D / Engineering Outsourcing engagement -- a rate that is over 26x greater than Industry Average organizations.
This report examined and analyzed organizations' planning, deployment, use, and management of Research and Development (R&D) and Engineering Outsourcing to provide a roadmap for constructing the internal framework necessary for a successful outsourcing relationship. As part of their outsourcing strategy, Best-in-Class organizations determined and allocated the proper amount of internal resources, incorporated clearly defined Service Level Agreements (SLAs), utilized a variety of analysis and measuring tools, and essentially viewed their outsourcing partner as an extension of their internal R&D team to achieve product differentiation and expedited time-to-market. In fact, Best-in-Class organizations are 123% more likely than Laggards to ensure their outsourcing provider has "skin in the game." By viewing the outsourcing engagement as a value partnership rather than merely and employee-contractor relationship, most often accomplished by contractually stipulating that both the outsourcer and outsourcing provider have a financial stake in meeting and exceeding project objectives, Best-in-Class organizations experienced an 18% increase in research productivity / efficiency, as well as a 13% increase in customer satisfaction.
"R&D and engineering outsourcing is most effective when organizations choose partners that share the business-critical mindset about the work they are performing," said Ralph Rodriguez, Senior Vice-President of Research, Technology Markets group. "In R&D it is especially relevant that delivery teams leverage deep knowledge to develop insights and find new ways to add continually value through the communication and application of their professional expertise."
The report educates end users on how Best-in-Class organizations are developing and managing their outsourcing initiatives as compared to others, and recommends clear actions to improve end user satisfaction and increase their ROI through the correct blend of capabilities, policies, and procedures. SLA management, internal structuring, monitoring and optimization tools, as well as other key performance indicators are reviewed.
Friday, July 11, 2008
Software, BPO industry growth will slow down next year
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The National Association of Software and Service Companies (Nasscom) report said while the industry clocked a combined growth rate of 28.2 percent in 2007-08, this is expected to slow down to between 21-24 percent in the next fiscal.
But even the projected growth rate of 21-24 percent is "robust" and in sync with the industry target of achieving $60 billion of exports by 2010, Nasscom president Som Mittal told reporters.
He said the industry was "right on target" to achieve the 2010 export goal.
"In the last eight years the average growth rate has been 33.7 percent. We have had as much as 50 percent growth in a single year initially. But it is natural for the growth to stabilise as the industry grows," he said.
The gross revenue from domestic as well as export markets increased to $52 billion in 2007-08 as compared to $39.6 billion the year before.
However, the growth rate fell from around 33 percent in 2006-07.
Exports of information technology (IT) services alone grew by 28.2 percent to gross $23.1 billion, while the BPO sector showed an increase of 30 percent, fetching $10.9 as compared to $8.4 billion the previous fiscal.
Mittal said the industry handled the subprime mortgage crisis in the US well by venturing into industries that were not affected, such as transport, telecom and healthcare.
He, however, admitted that 2007-08 was a "difficult" year because of slowdown in the US economy, the oil and food crises, and currency fluctuations.
Mittal said the full impact of the situation in the US is yet to be felt by Indian companies, and that corporates would have to find ways to cut costs and enhance productivity.
"The cost-cutting measures can have an impact on recruiting process of these companies and the pay-packages offered to fresh graduates," he added.
IT services and the BPO sector has a two million-strong workforce that is increasing by 26 percent annually, the Nasscom report stated.
Mittal brushed aside concerns about the future of outsourcing as it has become a major issue in the run-up to the presidential elections in the US.
"In 2003-04 elections also, offshoring had become a major issue, but the industry has only grown ever since. It is more of an emotive issue. Barack Obama, (the Democratic hopeful) who once voiced his concerns about outsourcing recently acknowledged its importance and referred to it as 'inevitable'," he said.
But even the projected growth rate of 21-24 percent is "robust" and in sync with the industry target of achieving $60 billion of exports by 2010, Nasscom president Som Mittal told reporters.
He said the industry was "right on target" to achieve the 2010 export goal.
"In the last eight years the average growth rate has been 33.7 percent. We have had as much as 50 percent growth in a single year initially. But it is natural for the growth to stabilise as the industry grows," he said.
The gross revenue from domestic as well as export markets increased to $52 billion in 2007-08 as compared to $39.6 billion the year before.
However, the growth rate fell from around 33 percent in 2006-07.
Exports of information technology (IT) services alone grew by 28.2 percent to gross $23.1 billion, while the BPO sector showed an increase of 30 percent, fetching $10.9 as compared to $8.4 billion the previous fiscal.
Mittal said the industry handled the subprime mortgage crisis in the US well by venturing into industries that were not affected, such as transport, telecom and healthcare.
He, however, admitted that 2007-08 was a "difficult" year because of slowdown in the US economy, the oil and food crises, and currency fluctuations.
Mittal said the full impact of the situation in the US is yet to be felt by Indian companies, and that corporates would have to find ways to cut costs and enhance productivity.
"The cost-cutting measures can have an impact on recruiting process of these companies and the pay-packages offered to fresh graduates," he added.
IT services and the BPO sector has a two million-strong workforce that is increasing by 26 percent annually, the Nasscom report stated.
Mittal brushed aside concerns about the future of outsourcing as it has become a major issue in the run-up to the presidential elections in the US.
"In 2003-04 elections also, offshoring had become a major issue, but the industry has only grown ever since. It is more of an emotive issue. Barack Obama, (the Democratic hopeful) who once voiced his concerns about outsourcing recently acknowledged its importance and referred to it as 'inevitable'," he said.
Thursday, July 10, 2008
Indian software exports cross 40-billion-dollar mark
Source : Click
"I would request you to focus not just on the number but on the maturity and resilience the industry has shown," Som Mittal, the president of the National Association of Software and Services Companies told reporters Wednesday.
"Never have there been so many uncertainties in the overall world."
IT export growth for the fiscal year ended March 31 was down four percent from the previous fiscal year, with earnings sharply reduced after the rupee gained more than 12 percent against the dollar in 2007, the body has said.
"After what hit us last year -- and I would say hit -- we were very susceptible to the currency," said Mittal, saying last year's slowdown was a wake-up call to the industry.
"If the rupee would always depreciate, we would always make money. But we don't know which way the rupee will go. We need to weed out inefficiencies."
The United States is the biggest market for Indian software and service exports, which are forecast by the industry group NASSCOM to hit 60 billion dollars by 2010.
But the software services industry was able to weather a US economic slowdown down fuelled by a housing loan crisis by diversifying into new areas and growing the domestic Indian market, Mittal added.
Last year the domestic software services market grew by 26 percent to almost 12 billion dollars, taking the industry as a whole past the 50 billion dollar mark.
Software and services revenue is supposed to grow between 21 and 24 percent in the current fiscal year, a decrease NASSCOM's Mittal attributed to the industry's larger base and ongoing global economic uncertainty.
"The first round of growth is always easier," said Mittal. "The next 10 years is going be structurally very different."
Mittal said the industry would need to compete harder by adopting automation and increasing services in other languages in order to continue to post high growth.
Mittal also expressed concern about a talent crunch and said the industry would have to increase its training efforts.
The industry currently employees two million people but Dun and Bradstreet, the US-based provider of financial information, has estimated that the industry would face a shortage of half a million skilled workers by 2009.
Indian software exports grew 29 percent to cross the 40-billion-dollar mark in the fiscal year just ended despite global economic turmoil, the outsourcing industry's top body said.
"I would request you to focus not just on the number but on the maturity and resilience the industry has shown," Som Mittal, the president of the National Association of Software and Services Companies told reporters Wednesday.
"Never have there been so many uncertainties in the overall world."
IT export growth for the fiscal year ended March 31 was down four percent from the previous fiscal year, with earnings sharply reduced after the rupee gained more than 12 percent against the dollar in 2007, the body has said.
"After what hit us last year -- and I would say hit -- we were very susceptible to the currency," said Mittal, saying last year's slowdown was a wake-up call to the industry.
"If the rupee would always depreciate, we would always make money. But we don't know which way the rupee will go. We need to weed out inefficiencies."
The United States is the biggest market for Indian software and service exports, which are forecast by the industry group NASSCOM to hit 60 billion dollars by 2010.
But the software services industry was able to weather a US economic slowdown down fuelled by a housing loan crisis by diversifying into new areas and growing the domestic Indian market, Mittal added.
Last year the domestic software services market grew by 26 percent to almost 12 billion dollars, taking the industry as a whole past the 50 billion dollar mark.
Software and services revenue is supposed to grow between 21 and 24 percent in the current fiscal year, a decrease NASSCOM's Mittal attributed to the industry's larger base and ongoing global economic uncertainty.
"The first round of growth is always easier," said Mittal. "The next 10 years is going be structurally very different."
Mittal said the industry would need to compete harder by adopting automation and increasing services in other languages in order to continue to post high growth.
Mittal also expressed concern about a talent crunch and said the industry would have to increase its training efforts.
The industry currently employees two million people but Dun and Bradstreet, the US-based provider of financial information, has estimated that the industry would face a shortage of half a million skilled workers by 2009.
Wednesday, July 09, 2008
Outsourcing risks often ignored
Source : Click
A NEW REPORT BY the Information Security Forum (ISF) suggests that, despite awareness of the information security risks linked to outsourcing, most companies still choose to bury their heads in the sand and ignore the problems until it’s too late.
Even well-documented cases of data loss and theft don’t seem to give companies the kick up the backside they need to implement better security measures according to the recently-published ISF report, Outsourcing and Offshoring Risk Management.
Simone Seth, author of the report, noted that the potential to cut costs and increase speed to market clearly made outsourcing and offshoring attractive options, but warned that, "without the right level of security expertise from the outset to fully identify information risk, there will always be important gaps in the business case." In other words, there’s a hole in my bucket, dear Liza.
She added, "If the necessary controls are not budgeted or put in place to mitigate the risks, it can have serious consequences and even threaten the long-term success of the outsourcing project."
According to the research, most information risk management is just bunged in as an afterthought, mainly due to a serious lack of security awareness in the top levels of the firm and a deep-rooted failure to understand the workings of information risk management.
Seth puts the major failures down to companies not involving information risk managers from the very beginning in outsourced projects, and then keeping them on for the duration of the project’s lifecycle. She claims that, without information risk managers present, the company leaves itself wide open to data theft, information leakage and even disputes over questions of ownership of intellectual property.
So, in other words, outsourcing might be cheaper, but if companies keep ignoring the security problems they face, it could end up costing them very dear, indeed. µ
Even well-documented cases of data loss and theft don’t seem to give companies the kick up the backside they need to implement better security measures according to the recently-published ISF report, Outsourcing and Offshoring Risk Management.
Simone Seth, author of the report, noted that the potential to cut costs and increase speed to market clearly made outsourcing and offshoring attractive options, but warned that, "without the right level of security expertise from the outset to fully identify information risk, there will always be important gaps in the business case." In other words, there’s a hole in my bucket, dear Liza.
She added, "If the necessary controls are not budgeted or put in place to mitigate the risks, it can have serious consequences and even threaten the long-term success of the outsourcing project."
According to the research, most information risk management is just bunged in as an afterthought, mainly due to a serious lack of security awareness in the top levels of the firm and a deep-rooted failure to understand the workings of information risk management.
Seth puts the major failures down to companies not involving information risk managers from the very beginning in outsourced projects, and then keeping them on for the duration of the project’s lifecycle. She claims that, without information risk managers present, the company leaves itself wide open to data theft, information leakage and even disputes over questions of ownership of intellectual property.
So, in other words, outsourcing might be cheaper, but if companies keep ignoring the security problems they face, it could end up costing them very dear, indeed. µ
Tuesday, July 08, 2008
New book for IT Professionals offers 20 alternative careers providing outsourcing insulation
Source : Click
Recession-related layoffs and hiring freezes, coupled with offshore outsourcing, have heightened competition for IT jobs, while exerting downward pressure on computer professionals' compensation. These factors are causing many IT professionals to consider changing careers, but they're understandably concerned about wasting their investment in their education and experience. Recently published "Debugging Your Information Technology Career" demonstrates that computer professionals can leverage their experience to enter many fields other than traditional IT careers, while reducing or eliminating their vulnerability to offshore outsourcing.
The author, Janice Weinberg, is a career consultant formerly with IBM and GE, whose IT background -- in systems and application programming, marketing, sales management, and strategic planning -- enabled her to identify the 20 careers she describes in the book. While most of them aren't usually thought of as computer-related jobs, computer proficiency is a key qualification for success in each. For example:
* A software architect's knowledge of best practices in systems design would be a strong asset in a technology due diligence position.
* A business analyst who guided manufacturing staff in defining their IT requirements could become a technology partner manager for a company marketing manufacturing software.
* A network security administrator would bring valuable knowledge to a position as a broker or underwriter of cyberliability insurance.
* A software engineer who supported finance and sales departments could become a global procurement project manager overseeing those functions.
* Any IT professional who can assess the commercial potential of new computer technology might qualify for a position as an equity analyst covering the technology sector.
Most of the careers can be entered without further education beyond a BS in a computer-related discipline. Several -- for example, business continuity planner -- require a certification. Some readers may be motivated to become healthcare administrators or attorneys specializing in computer law. Many of the fields can be springboards for consulting practices -- or new revenue streams for established consultancies.
Readers will learn job-hunting techniques tailored to specific fields, including guidance in identifying employers and selecting those aspects of their experience to highlight in their resumes and interviews for greatest impact.
The author, Janice Weinberg, is a career consultant formerly with IBM and GE, whose IT background -- in systems and application programming, marketing, sales management, and strategic planning -- enabled her to identify the 20 careers she describes in the book. While most of them aren't usually thought of as computer-related jobs, computer proficiency is a key qualification for success in each. For example:
* A software architect's knowledge of best practices in systems design would be a strong asset in a technology due diligence position.
* A business analyst who guided manufacturing staff in defining their IT requirements could become a technology partner manager for a company marketing manufacturing software.
* A network security administrator would bring valuable knowledge to a position as a broker or underwriter of cyberliability insurance.
* A software engineer who supported finance and sales departments could become a global procurement project manager overseeing those functions.
* Any IT professional who can assess the commercial potential of new computer technology might qualify for a position as an equity analyst covering the technology sector.
Most of the careers can be entered without further education beyond a BS in a computer-related discipline. Several -- for example, business continuity planner -- require a certification. Some readers may be motivated to become healthcare administrators or attorneys specializing in computer law. Many of the fields can be springboards for consulting practices -- or new revenue streams for established consultancies.
Readers will learn job-hunting techniques tailored to specific fields, including guidance in identifying employers and selecting those aspects of their experience to highlight in their resumes and interviews for greatest impact.
Thursday, July 03, 2008
Unisys Selects BMC Software to Improve Efficiency and Customer Satisfaction
Source : Click
BMC Software today announced that Unisys will standardize on key pieces of BMC's Business Service Management (BSM) offering, including BMC Asset Management, Discovery, Performance Management, and Monitoring solutions, to support its IT outsourcing services delivery across Asia Pacific.
"We look after critical components of our clients' businesses," said Lee Ward, general manager for Unisys Outsourcing and Infrastructure Services Delivery, Asia Pacific. "By standardizing on BMC Software solutions across our delivery centers in Asia Pacific, we're able to ensure that clients operating across multiple markets receive the same quality service experience regardless of their location. BMC's integrated BSM solutions are designed to allow us to quickly locate and begin managing our clients' assets with faster problem solving and resolution, optimized IT systems performance, and more accurate management of IT service level agreements."
Operating as a "single source of truth" on the IT infrastructure, the BMC Atrium Configuration Management Database (CMDB) will give Unisys a central, integrated repository and dashboard to monitor and manage clients' IT infrastructure. By using the automated BMC Discovery solution, Unisys will be able to quickly, accurately and automatically populate client asset information into the BMC Atrium CMDB, to rapidly respond to any changes in a client's business.
Having the asset and application information centrally managed from the BMC Atrium CMDB will provide Unisys with a clear view of the relationships between IT assets and critical business functions so that infrastructure and support services can respond quickly to keep these critical business functions up and running. BMC Atrium CMDB will allow Unisys clients to have an online, real-time view of what is being managed in their infrastructure.
BMC Performance Management, Event Management and Service Impact Management solutions will enable Unisys to help its clients optimize their IT infrastructure to improve end user satisfaction by ensuring performance, availability and management of both the virtual and physical infrastructure components.
Mike Davies, BMC's managing director for South Asia, said: "Unisys is focused on delivering value to its clients. Working with BMC now gives Unisys a set of powerful software solutions that puts IT firmly in control of the infrastructure to not only drive value, but provide them with the flexibility to deliver their services in a secure manner at the right cost."
"We look after critical components of our clients' businesses," said Lee Ward, general manager for Unisys Outsourcing and Infrastructure Services Delivery, Asia Pacific. "By standardizing on BMC Software solutions across our delivery centers in Asia Pacific, we're able to ensure that clients operating across multiple markets receive the same quality service experience regardless of their location. BMC's integrated BSM solutions are designed to allow us to quickly locate and begin managing our clients' assets with faster problem solving and resolution, optimized IT systems performance, and more accurate management of IT service level agreements."
Operating as a "single source of truth" on the IT infrastructure, the BMC Atrium Configuration Management Database (CMDB) will give Unisys a central, integrated repository and dashboard to monitor and manage clients' IT infrastructure. By using the automated BMC Discovery solution, Unisys will be able to quickly, accurately and automatically populate client asset information into the BMC Atrium CMDB, to rapidly respond to any changes in a client's business.
Having the asset and application information centrally managed from the BMC Atrium CMDB will provide Unisys with a clear view of the relationships between IT assets and critical business functions so that infrastructure and support services can respond quickly to keep these critical business functions up and running. BMC Atrium CMDB will allow Unisys clients to have an online, real-time view of what is being managed in their infrastructure.
BMC Performance Management, Event Management and Service Impact Management solutions will enable Unisys to help its clients optimize their IT infrastructure to improve end user satisfaction by ensuring performance, availability and management of both the virtual and physical infrastructure components.
Mike Davies, BMC's managing director for South Asia, said: "Unisys is focused on delivering value to its clients. Working with BMC now gives Unisys a set of powerful software solutions that puts IT firmly in control of the infrastructure to not only drive value, but provide them with the flexibility to deliver their services in a secure manner at the right cost."
Wednesday, July 02, 2008
IT Infrastructure Outsourcing Providers' Converging Value Propositions Creating Strategic Dilemma: Everest and Bernstein Webinar July 10
Source : Click
The strategic dilemma facing Infrastructure Outsourcing (IO) suppliers - caused by the convergence of 'traditional' (multinational) and offshore suppliers' value propositions, a maturing remote infrastructure management delivery model, and adoption of labor arbitrage by traditional suppliers - will be discussed in a one-hour Webinar hosted by analysts from the Everest Research Institute and Sanford C. Bernstein & Co. During the last decade, the emergence and rapid growth of new models of infrastructure services delivery, such as Remote Infrastructure Management (RIMO) and Information Management Services (IMS), are showing signs of convergence with more traditional ways of delivering infrastructure service. The Emerging Supplier Dilemma in the Remote Infrastructure Management Market report will be discussed in a one-hour Webinar on July 10 (10 a.m. CDT; 11 a.m. EDT).
According to Ross Tisnovsky, Vice President of ITO Research at Everest Research Institute, and Senior Analyst Rod Bourgeois of Sanford C. Bernstein & Co, offshore RIMO suppliers still hold a minor share of the IO market; nonetheless, there are increasing signs of the sophistication of RIMO leading to a growing convergence of the models of infrastructure delivery. The trend poses a challenge for buyers who need to understand the complexities of the offerings and suppliers who must refine their strategies, said Tisnovsky.
"The convergence of IO models is driving offshore suppliers to one of three choices," said Tisnovsky. "They can continue to adopt key elements of the IMS model, build added value to their RIMO offering or simply continue to focus on classical RIMO services that rely on labor savings as a key driver. On the other hand, traditional IO suppliers are confronted with a simpler, but not less challenging option: focus on end-to-end infrastructure deals that avoid direct competition or develop variations of a converged RIMO/IMS offering with an active role of labor arbitrage."
Evidence of convergence can be seen as offshore suppliers of remote management services are not limiting themselves anymore to targeting smaller companies with a basic labor arbitrage value proposition, says Bourgeois. Large buyers (above US$10 billion in revenue) now account for 55 percent of the deals signed by offshore suppliers. Although the majority of offshore deals are still based on delivering remote services offshore, RIMO suppliers held 24 percent of more traditional 'IMS-like' deals in 2007 compared to only five percent in 2004.
The 45-minute Webinar, followed by 15 minutes of questions and answers with participants, will take place on July 10, 2008, at 10 a.m. CDT; 11 a.m. EDT. To register, please visit: www.everestresearchinstitute.com/Events/Webinars.
According to Ross Tisnovsky, Vice President of ITO Research at Everest Research Institute, and Senior Analyst Rod Bourgeois of Sanford C. Bernstein & Co, offshore RIMO suppliers still hold a minor share of the IO market; nonetheless, there are increasing signs of the sophistication of RIMO leading to a growing convergence of the models of infrastructure delivery. The trend poses a challenge for buyers who need to understand the complexities of the offerings and suppliers who must refine their strategies, said Tisnovsky.
"The convergence of IO models is driving offshore suppliers to one of three choices," said Tisnovsky. "They can continue to adopt key elements of the IMS model, build added value to their RIMO offering or simply continue to focus on classical RIMO services that rely on labor savings as a key driver. On the other hand, traditional IO suppliers are confronted with a simpler, but not less challenging option: focus on end-to-end infrastructure deals that avoid direct competition or develop variations of a converged RIMO/IMS offering with an active role of labor arbitrage."
Evidence of convergence can be seen as offshore suppliers of remote management services are not limiting themselves anymore to targeting smaller companies with a basic labor arbitrage value proposition, says Bourgeois. Large buyers (above US$10 billion in revenue) now account for 55 percent of the deals signed by offshore suppliers. Although the majority of offshore deals are still based on delivering remote services offshore, RIMO suppliers held 24 percent of more traditional 'IMS-like' deals in 2007 compared to only five percent in 2004.
The 45-minute Webinar, followed by 15 minutes of questions and answers with participants, will take place on July 10, 2008, at 10 a.m. CDT; 11 a.m. EDT. To register, please visit: www.everestresearchinstitute.com/Events/Webinars.
Tuesday, July 01, 2008
Adobe, Google, Yahoo enabling Flash searches
Source : Click
The project would allow Flash pages to be returned in a search, meaning millions of rich Internet applications will become searchable
In a move that could add substantial volumes of Flash content to Internet search results, Adobe is working with Google and Yahoo to provide optimized Flash Player technology to enhance the searching of this content.
The project, being announced Tuesday, will enable searches on Flash content to return text and links, which can then be indexed, said Justin Everett-Church, Adobe senior product manager for the Flash Player. Content from a Flash application or even a game or advertisement will be available to search engines. Pages containing a Flash .SWF file will be returned in a search.
"The Flash Player is going to be used by Google and Yahoo on their servers to run Flash content at runtime," Everett-Church said. "This means much better search results for end-users. [Until now], it has been a challenge to search Flash content on the Web."
Google will begin offering Flash search capabilities Tuesday while Yahoo plans to do so in a future update to Yahoo Search. With Google's rollout, millions of rich Internet applications and dynamic Web experiences utilizing Flash will become searchable without the need for companies and developers to alter the content.
Adobe's move was described as a positive one by an analyst in the search engine space, who nonetheless said she would take a wait-and-see approach to gauge the exact benefits.
"Historically, search engines haven't been able to crawl Flash content at all," said Vanessa Fox, an editor at Search Engine Land, an online journal covering the search industry.
"I'm sort of reserving my judgment a little," she said. It is good that search engines are working with Adobe to surface Flash-based information, but the impact remains to be seen, Fox said. She added she has not been able to get examples of how many more pages can be indexed via the project.
"It could be a large impact or it also could be really small," said Fox. There are ecommerce sites based on Flash technology that now could make their content more visible, according to Fox.
"The idea of this is that search engines will now be able to extract the text and the link," but information maintained only in videos will still be invisible, she said. Video search capabilities could be added at some point, Everett-Church said.
"I do think developers who are implementing Flash on their site probably still need to pay attention to search engine optimization," Fox said. Adobe's effort probably will not fix all the current issues, she said.
Google and Yahoo, in prepared statements, both espoused purported benefits of the endeavor.
"Google has been working hard to improve how we can read and discover SWF files," said Bill Coughran, Google senior vice president of engineering. "Through our recent collaboration with Adobe, we now can help Web site owners that choose to design sites with Adobe Flash software by indexing content better."
"Yahoo is committed to supporting webmaster needs with plans to support searchable SWF and is working with Adobe to determine the best possible implementation," said Sean Suchter, vice president of Yahoo Search technology engineering.
While Adobe is working with Google and Yahoo initially, plans call for eventually making the new search capability available to benefit all content publishers, developers, and end-users, the company said.
In a move that could add substantial volumes of Flash content to Internet search results, Adobe is working with Google and Yahoo to provide optimized Flash Player technology to enhance the searching of this content.
The project, being announced Tuesday, will enable searches on Flash content to return text and links, which can then be indexed, said Justin Everett-Church, Adobe senior product manager for the Flash Player. Content from a Flash application or even a game or advertisement will be available to search engines. Pages containing a Flash .SWF file will be returned in a search.
"The Flash Player is going to be used by Google and Yahoo on their servers to run Flash content at runtime," Everett-Church said. "This means much better search results for end-users. [Until now], it has been a challenge to search Flash content on the Web."
Google will begin offering Flash search capabilities Tuesday while Yahoo plans to do so in a future update to Yahoo Search. With Google's rollout, millions of rich Internet applications and dynamic Web experiences utilizing Flash will become searchable without the need for companies and developers to alter the content.
Adobe's move was described as a positive one by an analyst in the search engine space, who nonetheless said she would take a wait-and-see approach to gauge the exact benefits.
"Historically, search engines haven't been able to crawl Flash content at all," said Vanessa Fox, an editor at Search Engine Land, an online journal covering the search industry.
"I'm sort of reserving my judgment a little," she said. It is good that search engines are working with Adobe to surface Flash-based information, but the impact remains to be seen, Fox said. She added she has not been able to get examples of how many more pages can be indexed via the project.
"It could be a large impact or it also could be really small," said Fox. There are ecommerce sites based on Flash technology that now could make their content more visible, according to Fox.
"The idea of this is that search engines will now be able to extract the text and the link," but information maintained only in videos will still be invisible, she said. Video search capabilities could be added at some point, Everett-Church said.
"I do think developers who are implementing Flash on their site probably still need to pay attention to search engine optimization," Fox said. Adobe's effort probably will not fix all the current issues, she said.
Google and Yahoo, in prepared statements, both espoused purported benefits of the endeavor.
"Google has been working hard to improve how we can read and discover SWF files," said Bill Coughran, Google senior vice president of engineering. "Through our recent collaboration with Adobe, we now can help Web site owners that choose to design sites with Adobe Flash software by indexing content better."
"Yahoo is committed to supporting webmaster needs with plans to support searchable SWF and is working with Adobe to determine the best possible implementation," said Sean Suchter, vice president of Yahoo Search technology engineering.
While Adobe is working with Google and Yahoo initially, plans call for eventually making the new search capability available to benefit all content publishers, developers, and end-users, the company said.
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