2006

Sweden's growth paradox

Productivity is rising, but the level of employment among working-age people actually declined from 1992 to 2003. Kalle Bengtsson, Claes Ekström, and Diana Farrell Web exclusive, June 2006 Sweden's economy has made a powerful comeback after decades of steady decline, when it slipped from the ranks of the world's most prosperous nations. Since 1995, the year McKinsey last reported on the country's economic performance, GDP growth has averaged 2.7 percent a year, which is stronger than that of most comparable EU countries. (The full report, Sweden's Economic Performance: Recent Developments, Current Priorities, is available free of charge online.) Per capita GDP has risen to 112 percent of the Organisation for Economic Co-operation and Development (OECD) average, from 104 percent—a notable contrast to the continuing stagnation in France, Germany, and Italy.

How European companies can unlock value from real estate

· In Germany and the United Kingdom, companies whose businesses are unrelated to real estate hold more than €1 trillion worth of property. Such illiquid assets represent an opportunity.
· Newly proposed laws to introduce real estate investment trusts in these countries could allow companies to unlock value from excess real estate. REITs also benefit investors and tax authorities.
· However, a robust market for REITs won't develop unless companies sell their excess property. Here, the proposed laws fall short. Unless lawmakers amend the proposed legislation to remove certain restrictions and disincentives, the market for REITs in Germany and the United Kingdom will be stunted and the promise of REITs unfulfilled.

Using IT to boost call-center performance

Call centers, making targeted improvements involving more cost-effective technologies, are finally saving money and improving revenues with IT. Wayne E. Pietraszek and Adesh Ramchandran Web exclusive, March 2006 Executives who have spent tens of millions of dollars on call-center technologies can be forgiven for being wary of big investments to overhaul their systems if they don't have a clear picture of the expected benefits. They are all too familiar with horror stories about large outlays that have yielded no returns—for instance, the tale of the telecom company that spent more than $50 million on new customer-relationship-management (CRM) technology for its frontline agents but saw no improvements in revenue or customer satisfaction, because those agents ignored the system.

The untapped market for offshore services

· Providers of offshored IT services and business processes have so far captured only 10 percent of a $300 billion opportunity. In the next five years, a study shows, this market will grow by an additional $80 billion.
· Traditionally outsourced IT services, such as hardware and software maintenance—which have seen very little offshoring to date—will probably drive the next wave of growth. Offshoring should increase more rapidly in business processes than in IT services; banking and insurance will likely lead the way. Further growth will come from new "offshore-only" services that go beyond the simple replication of onshore ones.


Outsourced Service Providers

The immense growth in customer service inquiries and the shift to a multi-channel service environment has left many companies grappling with the problems of building and managing contact centers. This paper discusses five tried and tested ways to help you improve service levels and quality for your clients, along with differentiating your service with additional offerings. It also provides a checklist of capabilities to look for in a service management platform for the outsourcing environment.


Real-Time F&A Monitoring Moves Shared Service Centres from Good to Great What if a SSC could immediately identify, prioritize and quantify all errors and accounting exceptions within the financial transactions across multiple financial ERP systems? What if these objectives could be performed on a real-time basis, every two or three minutes, extracting data without degrading the ERP financial system’s performance? The fact is, due to innovative exploitation of existing technology, a monitoring tool and application now exists that accomplishes these goals.


F&A Outsourcing Providers Discover Competitive Advantage with Real-Time Transaction Inspection
Business Process Outsourcing (BPO) service providers specializing in finance and accounting (F&A) see a growing market opportunity but already face increasing price pressures. Advisory firms are commoditizing engagements and defining what service level guarantees should be. In addition, costs keep escalating in offshore locations, diminishing some benefits of labor arbitrage. These market forces are creating immediate cost pressures on providers in the first year of outsourcing relationships. At the same time, providers need to focus on additional ways to increase their margins with existing clients. Due to innovative exploitation of existing technology, Oversight Systems provides a software-based solution that enables providers to meet these objectives with real-time transaction inspection.


Value Added Benefits of Outsourcing
Given the relentless demand by customers for getting more for less, it’s certain that work will increasingly be outsourced to partners around the corner and around the world. As various studies and decades of actual experience have shown, the value added through outsourcing not only benefits the outsourcing provider and customer, but the economy as a whole. Global sourcing is not a zero-sum game.


Achieve Measurable Results

Achieving real results from information technology outsourcing depends on a variety of factors. Understanding the advantages of outsourcing and identifying business functions with the greatest potential to benefit is fundamental. Defining an outsourcing strategy that aligns with business

goals and effectively managing the outsourcing relationship are essential. Finally, setting standards for improvement and evaluating key performance indicators can help ensure long-term, business-building results.


Smart source: Do More with Less
Can the seemingly contradictory mandates of cost cutting and innovation be integrated? The view presented in this white paper contends that they must be integrated through the use of an innovative strategy called smart sourcing, which leverages the competencies of service providers in order to achieve a significant increase in total innovative capacity.



Longitudinal Convergence
Aligning Business and Outsourcing Objectives in Mid-Market Companies
Ram Iyer
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Shared Services in Government
Turning private-sector lessons into public-sector best practices
AT Kearney
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Avoiding Blind Spots in ERP
Infocrossing
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Email Defense
Managing the Skyrocketing Costs of Email Security
(i)Structure
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Outsourcing, As Sweet As Candy
Learn how Duane Hurley, CIO of Farley‘s & Sathers used outsourcing to overcome a merger, three acquisitions, IT transitions, and new implementations.
Outsourcing Venture
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How to Outsource
Four Simple Steps to Success
Syntel
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Eleven Steps to Success in Data Warehousing
Syntel
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Optimizing Application Management Outsourcing
Best Practices to Reduce TCO and Increase Business Value
Syntel
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Succeeding with Business Process Outsourcing
Syntel
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Understanding the RFP Process
Outsourcing Venture
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Expert Sourcing
SpectrumHR
You may get a case of the chills, shivers, and a headache when management tells you it is planning to outsource a certain area of your job. Why? Because the word outsource has a negative connotation associated with it.

Outsourcing Frontier: Yanks Need Apply
John P. Mello Jr., CFO.com
Not content with siphoning jobs from the United States, India has started cherry-picking its worker pool, too. The market for expatriates in India has heated up appreciably in the last three months or so, says Art Flew, CEO of Hyderabad-based business process outsourcing company Karvy Global Services.

Evaluating HRO Providers by a Detailed RFP
Marc S. Miller
By now you know that there are nearly three dozen HRO/BPO providers vying for your business.
They are all very different from each other. Their differences become evident when you examine such characteristics as their market share, target market/account, visibility, the HR functionality they deliver, the HR technology they utilize to provide the functionality and their pricing and staffing model.


Finance & Accounting Outsourcing Market Overview and Analysis of Leading Service Providers, 2006

Finance & Accounting Basics

Accounting is an information system that measures, processes and communicates financial information about an economic entity, like a business, hospital or governmental body. The same basic accounting principles apply not only to profit-oriented ventures but also to government and not-for-profit organizations (like hospitals, universities, professional organizations and charities). Financial statements are the primary means of communicating important accounting information to users.

Finance to go

Ben McLannahan
Call it a sign of the times. In late 2003, GlaxoSmithKline (GSK), the £20 billion ($35 billion) U.K.-based pharmaceuticals company, began a project to uproot its U.K. financial shared services centre and move it to India. In August this year, it agreed to hand over the running of the offshore operations — including processes such as accounts payable, inter-company and financial reporting, payroll, and travel expenses — to Genpact, GE's business process outsourcing (BPO) unit. "The decision was taken after a full review. We decided that these services could be provided at a lower cost, while maintaining our current service standards," says David Mawdsley, a GSK spokesman.

Most Companies Happy with HR Outsourcing

Stephen Taub
Most large companies have embraced human resources outsourcing, according to a survey by Hewitt Associates of 129 large businesses representing nearly two million employees.
Hewitt, which provides outsourcing and consulting services, found that 94 percent of respondents outsource at least one HR function, either partially or fully, 89 percent are satisfied with their outsourcing arrangement, and 85 percent said they achieved hoped-for benefits.


Gillette Deal Gets Nicked

CFO Magazine

Gillette Corp. markets its shaving products, as "the best a man can get," but is its planned sale to consumer-products giant Procter & Gamble the best deal it can get? Regulators in Gillette's home state of Massachusetts don't think so.
Secretary of State William Galvin has launched an investigation into the terms of the deal that is testing the limits of how far regulators can go to protect shareholders and the public interest when an out-of-state suitor pursues a large company.


Simple Successful Outsourcing

Stephanie Overby

You've heard the tales of outsourcing gloom and doom and read about the staggering percentages of outsourcing failure. Now consider these three CIOs' experiences:

Five years ago, a business unit at energy giant Cinergy Corp. outsourced database administration services, with no plan to extend the contract to any other part of the business. But when Cinergy centralized IT two years later, CIO Bennett Gaines called on the outsourcer to provide database administration services enterprisewide. Since then, the outsourcer has proved instrumental in a major technology shift—from data marts to an enterprise data warehouse.

Four years ago, Summit Information Systems, a software developer for credit unions, outsourced…..


Outsource, Don't Abdicate

Ben Gomes-Casseres
My favorite post-Enron cartoon, by Dan Wasserman, has two captains of industry discussing what to do about the fallout from corporate scandals. "We are seen as ethical disasters," says one of them. "How are we going to rebuild public trust?" In a flash of brilliance, the other answers: "We could outsource it!"


Backsourcing Pain

Stephanie Overby

When David Rosario got the official notice at the end of 2002 that his job would be outsourced to IBM, he was not surprised.

Rumors had been circulating for months at JPMorgan Chase, where he had worked as a network engineer since 2001, that the company would be signing away much of IT to an external services company.


Outsourced Service Providers: 5 Ways to Differentiate Your Service Offering
This paper contains 5 simple ways to enhance the outsourced service offerings. These suggestions will help to improve service levels and quality for the clients, along with differentiating the service with additional offerings. The paper also provides a checklist of capabilities to look for in a service management platform for the outsourcing environment.


Managing the Complexity of Network Convergence Through Outsourcing
The convergence of voice, video and data networks, along with wired and wireless environments, brings unprecedented opportunities for a business that can capitalize on change. When managed correctly, network convergence can enable companies to operate more efficiently, increase returns on technology investments and realize other business benefits. Yet despite these potential gains, network convergence remains a complex undertaking that creates new technical, operational and managerial challenges. Faced with these challenges, enterprises are increasingly turning to outsourcing service providers. The extensive infrastructure, expertise and services of an outsourcing service provider can help an organization overcome the complexity of bringing together diverse networks.


Effective Outsource Management: Preventing Customer Churn and Unforeseen Costs
Outsourcing all or part of a company's customer service operation has the potential to lower costs, better focus in-house resources, and even improve customer relationships - but entrusting customers to an outside vendor also creates a service "Gap" that can jeopardize those customer relationships. Executives who hire an outsourcer to make customer service problems "Go away" often find that the projected cost savings are quickly swamped by increased customer dissatisfaction and expensive customer attrition. Effective outsourcing means eliminating the service gap by intelligently and actively managing outsourcing relationships.



2006 Global Outsourcing Guide
Stephanie Overby
In all the discussion about outsourcing, one simple fact sometimes gets lost: Nobody beats the United States when it comes to people with IT skills. Taking into account the size and availability of the labor force, their education, relevant experience, language skills and turnover rates, A.T. Kearney ranked America tops in this area on its 2005 Global Services Location Index.
But labor arbitrage-cutting costs by exploiting the availability of lower-wage workers-remains the name of the game in IT sourcing. CIOs continue to seek savings through offshore outsourcing, and the Everest Research Institute predicts those savings will continue to drive sourcing offshore for the next 30 years. Today, 73% of Fortune 2000 companies say offshoring is an important part of their overall growth strategy, according to the 2005 Duke University CIBER_Archstone Consulting study. And Gartner predics worldwide offshore spending will reach $50 billion next year.

In this, CIO's third global outsourcing guide, we observe how the offshoring world has changed.


Is Offshoring Coding Yesterday’s Fad?
Over brunch in a cheap Brooklyn restaurant, a longtime MIT friend proudly demonstrated his latest startup's software. The idea is clever, and its beta implementation is sweet. I liked it; usually the stuff I see turns my stomach. So I'm pleased that Hans Peter Brondmo's Web-based "personal information organizer" has technical chops and global business potential.

Next Stop, New Delhi
BY DAVID ROSENBAUM
Christmas came early to India this year.
Just before the holiday, several big American companies were competing to see which one could invest more money in the subcontinent.
Intel was first out of the gate, saying it would spend a billion during the next five years. The following day, JPMorgan Chase said it planned to double its Indian workforce. And then Bill Gates, visiting New Delhi, announced that his feisty little software outfit planned to invest $1.7 billion (take that, Intel!) and hire 3,000 new people in India during the next four years.

Big Deals, Big Savings, Big Problems Hidden Costs Come Home to Roost
As the new year began, the news was full of American companies expanding their outsourcing investments in India, China and elsewhere. Cheap materials and cheaper labor make offshoring a no-brainer for everyone from service providers to manufacturers. And so CIOs have had to think about readying their enterprise infrastructures to make the most of those opportunities.

How to Ease the Pain of Globalization Not a week goes by without an article in the press about the offshoring of information technology—whether it's the production of hardware, call center and programming jobs, or even research and development activities. Media pundits and politicians have seized on these reports as auguries of America's demise. But are things really that bad? Is there nothing positive about moving some of America's IT activities abroad? More importantly, what specific strategies can U.S. policymakers implement to maximize the gain and minimize the pain associated with these rapid changes?


Ignoring Business Strategy Makes for Weak Outsourcing Efforts
With Christopher D. Jones, principal strategy consultant for Source Renaissance, a sourcing and IT strategy consultancy.

Question: Source Renaissance (www.sourcerenaissance.com) has just published a white paper entitled, "Sourcing Strategy: Knowing When to Outsource." During the research for this white paper, what did you find were the biggest mistakes that companies are making when approaching an outsourcing solution?
Jones: What seems to be missing most often is a linkage to business strategy. Behind that it's having insufficient data to build a solid business case, meaning assumptions are driving decisions rather than facts. These two factors alone — lack of strategy and data — can be highly destructive to the cause. And sadly, the tests are simple ones: Why are you outsourcing? Does it make sense in the context of your other business strategies? What returns are expected, and will your suppliers have a contractual stake in achieving them? What are the capabilities and possibilities within the current organization? If you don't have a handle on key drivers like these, it will be difficult to achieve a favorable result.


Outsourcing Strategy Shift
How Western and Eastern IT and BPO players are converging on a single model; the challenge for India
by Demir Barlas, Line56

Monday, March 20, 2006
In the world of IT and business process outsourcing (BPO), one fact is currently indisputable: the biggest pool of available, and low-cost, talent is in India.That granted, different vendors can profit from this fact. Certainly IBM, with its promise of ramping up to an Indian workforce of 50,000 employees, has done so. So has Capgemini, which recently announced the creation of its third Indian center (in Kolkata) and its plans to expand from 4,000 Indian employees to 10,000 by 2007.


Utility Companies Turn to Onshore IT
TAKEAWAY: Utility companies in the UK are spending more on IT than most, according to ComputerWeekly.com. This trend is being led by a rise in IT outsourcing, and utility companies are finding success in shipping IT functions out of house. But out of house doesn't necessarily mean offshore. Instead, companies in the UK are turning more towards onshore options, favouring national options that focus on increasing key business strategies rather than merely lowering costs.

Dissatisfaction with Outsourcing Is Greater with Onshore Deals
TAKEAWAY: Forty-seven percent of companies have prematurely terminated at least one outsourcing contract in the previous 12 months, according to a Diamond Cluster International study, with the percentage higher for onshore contracts (42 percent) than for offshore deals (28 percent). Poor performance was cited by 53 percent of the companies as the reason for cancellation. Companies are beginning to favour offshore providers over onshore vendors, says a Diamond Cluster executive, largely because offshore providers increasingly offer certifications such as CMMI, along with significantly lower costs. Though the increase in overall negative reactions to outsourcing increased when compared to earlier Diamond Cluster surveys, the exec says IT managers are beginning to utilize outsourcing as a comprehensive strategy rather than simply outsourcing individual tasks.

IT outsourcing draws interest from utility companies
Suppliers of electricity, gas and water are reportedly spending more on IT and technology than the national average.

New research from Computer Weekly indicates that this is being led by the rising popularity of IT outsourcing, with large businesses and SMEs alike benefiting from the service.

Large utility companies are said to spend £10,296 per desktop each year on technology, which compares to a UK-wide business average of £8,455. Smaller utility firms, meanwhile, are spending £3,551 per desktop, which compares to an average of £3,132 for SMEs as a whole.


Outsourcing Boom Is Over
The outsourcing boom has passed and maturity is setting in, according to a new study from consulting firm Diamond Cluster International in Chicago.
The levelling off is due in part to experienced customers becoming savvier and pickier about the work they hand to outsourcing providers.


Poor controls raise outsourcing risks
A new survey indicates few companies have the right systems to manage outsourcing deals with multiple suppliers
James Murray, IT Week 10 Apr 2006
IT outsourcing in Western Europe will continue to increase over the next two years, according to a new survey by Gartner. But the analyst firm warned that many companies face unnecessary risks because they have not developed coherent management strategies for outsourcing.

Outsourcing Is Getting Smarter
TAKEAWAY: Outsourcing isn't all about reducing costs, and companies who operate on that assumption are making a big mistake, says the author of the self-explanatory "Smart sourcing: Driving Innovation and Growth Through Outsourcing." The most interesting section of this short but wide-ranging Q&A is his assessment of General Electric's outsourcing strategy. Jack Welch's rule: Outsource 70 percent of the back office, offshore 70 percent of that, and send 70 percent of the offshore work to India. More importantly, GE sent not just menial tasks but also R&D to India, creating what the author calls "a global ecosystem that fuelled its growth." He encourages companies to follow GE's lead and view sending work offshore as a way to improve the onshore focus on their core strengths.


Relationships Are Key to IT Outsourcing

TAKEAWAY: Outsourcing IT tasks can solve a number of problems in a cost-effective, business-savvy way, but without the proper relationships holding up the outsourcing effort, the partnership can fail. To avoid such a disaster, this article outlines some steps in finding IT outsourcing providers that will keep a data centre on the right path. Before interviewing any vendors, companies must determine the areas that need work. Once the problem area has been outlined, the company should gather information on partners with the right niche experience. These partners should prove a strong success rate in tying IT in with business goals and strategy — without that common ground, the outsourcing relationship could falter early. Companies need to give an outsourcing relationship some time to work through any communication issues, and follow-up is key in maintaining any momentum in the partnership.


Outsourcing Relationships From An IT Perspective
Security, Confidentiality & Support Are Essential Elements
Most small to midsized enterprises are more than familiar with outsourced services, often getting their carpets cleaned, taxes done, and legal wrangles handled by professionals outside the company. But when it comes to IT tasks, there are a number of distinctive issues that set the arrangement apart from other types of rented services.

Major differences include the need to protect internal data and customer information and to make sure consultants understand how much uptime is expected.

Analysts have touted the benefits of outsourcing tasks such as hardware and software integration, project management, security tasks, and data recovery. Many times, having these experts swoop in to solve problems is far more cost effective than trying to add to staff, but the relationships also need some care and feeding to be successful. Here are some steps toward finding an outsourcing provider that has both the tech savvy and business sense to keep a data centre on course.

Strategizing to Survive Outsourcing
TAKEAWAY: This article shares some advice from two new books on the outsourcing scene: "The Manager's Step-By-Step Guide to Outsourcing" by Linda R. Dominguez and "Multisourcing" by Linda Cohen and Allie Young. The first covers the risks of outsourcing, including customer service concerns, security and privacy issues and the fact that any thought of cost savings may be a "mirage." Also covered in the book are the top five mistakes, including outsourcing a broken process or function, allowing cost savings to be a key driver and rushing through the outsourcing process. The second book focuses on the need for a sourcing strategy and offers five key questions to help create one.


Outsourcing and the Board: Who Owns the Project?
With Stacey Berlow, president and founder of Project Balance [www.projectbalance.com], an Austin, Texas-based project management practice specializing in gathering business specifications and managing global teams.

Question: The boardroom-level ownership of outsourcing projects used to be clearly defined as within the IT department's arena, but now other areas in the corporate structure are laying claim to outsourcing efforts. Why is this happening?
Berlow: For many companies, the strategy of outsourcing processes or services that are not part of their core business competency makes good economic sense. IT was one of the first functional areas to outsource, but many other departments have turned to outsourcing to reduce overall operating costs. The kinds of outsourcing initiatives can vary greatly, including everything from outsourcing the mailroom to outsourcing complex processes, such as insurance claims processing. Even with the best intentions and management, the execution of an outsourcing strategy can cost much more than expected. Greater communication costs, including travel, phone and other IT infrastructure requirements, can be significant beyond the anticipated lower cost of labour. Financial managers and CFOs want to control these costs and hence control entire projects in order to meet their original expected cost reduction goals.


Global Outsourcing: Seven Steps to Selecting a Vendor
By Ravi Kalakota, Marcia Robinson

Introduction

Vendor selection requires a multifaceted, multistage methodology to evaluate not only what a service provider can do, but also how it’s done. But searching for the right vendor can be tedious. Many providers that meet defined criteria prove unsuitable for myriad reasons. Months of studying prospects, conducting site visits, and negotiating costs may result in frustration and the temptation to quickly close a contract that ends in dissatisfaction.
Here are the facts. A well-organized vendor selection process usually spans 6–12 months and ranges upward of 2% of the annual cost of the project. Some of the larger IT outsourcing deals—such as the one oil giant Shell inked with IBM and Wipro in 2004—have reached close to $1 billion in size, so that 2% adds up.


Firms no longer coy about outsourcing
Vishwanath Kulkarni
Secrecy surrounding outsourcing strategies of global software product companies may soon be a thing of the past.
Software product firms, which were forced to keep their outsourcing plans under wraps following the tech meltdown early this decade, may soon start disclosing their plans publicly, especially in India.
This is because some of the India-based outsourced product development (OPD) firms are seen convincing their clientele to open up and declare that their products are being developed here.
"We are trying to adopt a joint strategy with our customers to announce the partnerships and the kind of work we are doing with them," said Mr Ajay Kela, President, Symphony Services, an OPD firm.

SOA Spells Slowdown for Development Outsourcing
In this interview, LogicLibrary CEO Greg Coticchia discusses a new trend in which companies are avoiding application development outsourcing through reusing services with an SOA. LogicLibrary's focus is on its metadata repository, which allows IT managers to contain Web services by "mapping, securing and governing components that can be used as services." Coticchia says that companies are finding the reuse strategy as another way to compete effectively with offshore options. Coticchia has found that, generally, 60 percent of a project has reusable assets that are still in-house after the project is completed. Those assets can be reused, at great cost advantage, to continue to reap cost benefits—but only if the assets can be located and restored appropriately.

TPI: Offshore outsourcing set for further growth
Despite the continued controversy surrounding off shoring, a record level of outsourcing deals currently under negotiation involve off shoring, according to the latest Quarterly Index data from TPI, the sourcing advisory firm.

TPI: Offshore outsourcing set for further growth

Very little information is available on the breakdown of outsourcing between onshore and offshore operations. However, an analysis of deals on which TPI is currently advising (which represent approximately a quarter of the commercial outsourcing market and provide a six to nine month indicator of where the market is heading) reveals that almost half (47 per cent) involve off shoring or ‘global service delivery’. This compares with 28 per cent at this point last year and represents a record high. Furthermore, where outsourcing contracts contain an offshore element, a far greater proportion of the work is moving offshore, averaging almost half (48 per cent) of the contract value, up from 27 per cent a year ago.


Siemens CEO Klaus Kleinfeld: “Nobody’s Perfect, but a Team Can Be”
Corporate leaders must build international organizations to compete in today’s economy and be prepared to defend globalisation at home, according to Klaus Kleinfeld, chief executive of the German electrical and engineering conglomerate Siemens AG.
Speaking at a recent Wharton Leadership Lecture, Kleinfeld said U.S. concerns about the sale of port assets to a Dubai-based firm, and French resistance to the sale of yogurt-maker Danone – which French officials called a “national treasure” – highlight growing fears that globalization come at the cost of jobs in developed countries. Those fears could spark a backlash against globalism and limit future economic growth, he warned. “The common people – the voters – do not understand what’s going on and see a threat,” said Kleinfeld. “We, as leaders, need to be responsible for explaining the positives of globalization.

Finding value for BPO through revenue distance
In the last decade, companies have discovered that outsourcing some tasks to cheaper locations is one way to deliver efficiencies and cut costs. But the simple act to outsourcing to a lower cost base has evolved into a complex process that can inflict considerable damage if not dealt with in a sophisticated and scientific manner. The damage can range from not achieving the expected cost savings to losing control to a third party, particularly when a company’s more essential processes are outsourced.


When the Market Is Fragmented, Jump on a Platform
Your company's products are excellent, they're in demand, and the business opportunity is too good to pass up. You just don't have any big customers--your product sells to thousands of independent retailers. It is often difficult for any one player to justify the investment needed to build and maintain a national distribution network in a fragmented market. But a group of players with a large combined volume can create economies of scale by using a shared industry platform--a third-party vendor that aggregates the needs of multiple companies to provide more efficient supply chain-related services. This article describes the details and benefits.


Build Contractor Relationships that Are Mutually Beneficial
Companies entering into relationships with contract manufacturers know they're vulnerable to these vendors. And, too often, contractors have become adept at taking advantage of companies desperately seeking to pare supply chain costs through outsourcing. But just as you don't want a contractor to get the upper hand, you also don't want the contractor to suffer; the aim is to structure a relationship in which both parties thrive. To that end, supply chain managers and chief executives alike can take steps to ensure that partnerships with contract manufacturers are successful and prevent their companies from falling prey to one-sided deals. Read this article to learn about the steps a company can take to ensure a successful partnership with a contract manufacturer.

Are You Sending Your Problems Offshore?
It seems straightforward enough--why not simply outsource routine financial reporting functions offshore? Sure, you'll save some money. But if these processes are flawed to begin with, you only transplant their inefficiencies elsewhere, missing the greater opportunity to streamline. The authors contend that while outsourcing can be a central piece in an effort to improve operations, a significant chunk of any program's benefits comes from changing attitudes, behaviours, and cultures within the company's own walls. Read this article to learn how to look within and revamp existing functions before heading offshore.


Supply Chain Strategy, December 2005-January 2006, Volume 2, Number 1
This issue of the Supply Chain Strategy newsletter contains the following articles: "Best Buy's Customer-Facing Supply Chain," "Drive Complexity Out of Your Supply Chain," "How Soft Metrics Can Make Hard Choices Easier," "Debriefing Larry Bossidy: What Gets Things Done," and "Keep Your Sourcing Options Open."


Keep Your Sourcing Options Open
No matter how good your demand forecasts are, a supply chain that is stretched internationally is exposed to a great deal of risk--and even the best-laid offshoring plans go awry. But why should a decision to outsource be an all-or-nothing proposition? Consider a hybrid sourcing strategy--a mix of "reactive" manufacturing capacity located near end markets to meet unexpected demand surges--and a slower, less flexible "base" capacity in countries that can take advantage of mass production operations. The result? A sliding scale that allows you to balance the advantages of both systems.


THE INFORMATION ARCHITECT: On-demand cuts costs, increases success rate of CRM

Maxine Kincora, Contributor


On-premise customer relationship management (CRM) implementations have a median cost of about $1.2 million over five years, and they fail at alarming rates, almost 80%. So, it's no wonder that outsourced on-demand CRM, which offers low-cost entry and high success rates, is catching on.



IN SEARCH OF THE EXOTHERMIC DATA CENTER
by Thornton May
As any chemist will tell you, an exothermic reaction is one that releases more energy than it consumes. If we apply that notion to finance, an exothermic investment is one that releases more resources than it consumes. Now go a step further -- into the "exothermic data centre" -- where investments in IT result in a far greater return to the company than originally expected.


2006: What to expect
Now that 2006 is finally here, what should you expect? Get predictions, survey results and analyst news about blogging, outsourcing, IT spending and more for the New Year.


EXECUTIVE CHAMPION
OFFSHORING ISN'T JUST FOR THE BIG GUYS
by James Champy
Off shoring: not just for the enterprise anymore
The debate about whether off shoring IT work is good or bad for the U.S. economy focuses on the wrong issue. Companies should be concerned about their competitiveness and whether off shoring can improve their performance. Only by remaining competitive can a company maintain or create jobs. So the question isn't whether off shoring is beneficial, but rather how it can create competitive edge for your company.



Outsourcing: It’s the money stupid
By Michael Cooney
A new study from Gartner shows what most companies know (except Apple apparently) that most outsourcing deals are done to save money. According to a statement released by the company today, “controlling/reducing operating costs or improving efficiencies” was identified by more than half of the respondents in each region as the primary value they expected to receive from IT outsourcing. Efficiency deals are focused on cost control and, over time, cost reduction with the global of maintaining consistency in service delivery. The survey found that fewer organizations focused their IT outsourcing initiatives on accelerating or improving business outcomes, called enhancement deals, or significantly improving or altering their competitiveness, referred to as transformation deals.



Outsourcing is the New Rule
By Carol Kendrick
Before, large corporations were the ones who rule the industry hence implementing that old-school rules are the most effective ones in the industry. Nowadays, this kind of thinking would make you out…

Communication plays a vital part in Outsourcing
By Carol Kendrick
Outsourcing is undoubtedly a part of global development because of its ability to make the world a “smaller place” Though that is the case, not every company could claim that outsourcing is…


Outsourcing or smart sourcing?
By Carol Kendrick
Have you ever heard of the term smart sourcing? Apparently, this should be the main approach of companies who are expecting more than saving cost when outsourcing. Smart sourcing is also a book written….


Delta Turns to Outsourcing
By Carol Kendrick
Delta Airlines, the third largest carrier is now bent on asking a bankruptcy judge to consider outsourcing for the airline company. According to Delta, they are considering outsourcing their computer…

Anti-Outsourcing Attitude: A Normal Reaction
By Carol Kendrick
Outsourcing and off shoring topics have always been received with mixed reactions. Some people welcomes outsourcing as part of globalization while most people still has a negative attitude towards….


Staff Benefits Outsourcing to Double
By Carol Kendrick
“Outsourcing staff benefits continues to grow and could double in the years to come”. This was the prediction given by analysts regarding staff benefits outsourcing which could have the….

R&D Outsourcing Prioritizes on Skill.
By Carol Kendrick
Outsourcing Research and Development (R&D) is becoming a popular practice for firms. Wipro, Indian IT services company recently made a study focusing on the reasons why R&D outsourcing is…

Africa Joins the Call Centre Hype
By Carol Kendrick
Call centres are considered as one of the most outsourced functions in a business. This is also the reason why countries like India and Philippines have a growing outsourcing Industry. It also seems….

Numerous Job Loss Due to off shoring
By Carol Kendrick
If ever the term “off shoring” or “outsourcing” is mentioned to employees, they immediately adequate it with job loss. The reality behind this connotation seems to be true as…


Egypt: The new Outsourcing Destination
By Carol Kendrick
Egypt is popularly known as the country wherein one could see the historic pyramids. Nowadays, the country is now bringing up its image as an attractive outsourcing-off shoring option for firms. The….

UK Insists on Secured Outsourcing
By Carol Kendrick
The British government is now emphasizing on the need to secure all business transaction regardless if they are outsourced or not. The emphasis on secured outsourcing was done when the British…



Application Maintenance – The trend to Latin America
IT outsourcing in Mexico and other countries has started to trend to application maintenance. Corporate applications always need adjusting, as bugs are found or design flaws are uncovered. These...



Accenture Opts for SOA
By Carol Kendrick
Accenture, one of the biggest names in the outsourcing industry recently announced their intention of investing more on the development of service-oriented architecture applications or SOA. SOA was….

Culture Difference Harms Off shoring
By Carol Kendrick
One of the reasons why off shoring and outsourcing seems to be unsuccessful is because of culture difference. This was the conclusion given in the latest study done by Accenture. The study also….

Bank Outsourcing
By Carol Kendrick
Before, IT functions were the only ones that were joining the outsourcing industry. Nowadays, it seems like even banks are joining the outsourcing wave. Most finance operations are now transferring…

The New Outsourcing Destination: El Salvador
By Carol Kendrick
There is a new country joining the outsourcing industry. The country? El Salvador, El Salvador was once considered as one of the most deregulated economies in Central America because of their civil war….



Contracts: A vital Part in Outsourcing
By Carol Kendrick
Research analyst Gartner recently revealed that contracts in outsourcing plays a vital role in the outsourcing deal’s success or failure. According to the research analyst, the inability of coming…



Wipro and Motorola Combine for an IT Outsourcing Deal
By Carol Kendrick
Motorola and Wipro Technologies recently signed a joint IT outsourcing venture dubbed as the WMNetServ. The newly signed venture would deal with outsourcing different telecommunication services….


Lego Set to Outsource
By Carol Kendrick
Lego, one of the oldest names in Toy manufacturing recently announced that they are now joining the outsourcing bandwagon. According to the Danish-based firm, they would outsource most of their…




Rising Profits for Infosys
By Carol Kendrick
Infosys Technologies Ltd. Revealed that their profit and growth rate have surpassed their expectation revealing a 7% raise in terms of shares. Aside from that, statistics also showed that Infosys has…

Outsourcing Rush in a Halt
By Carol Kendrick
The number of firms considering IT outsourcing is still growing but the rush behind it is now gone. This was the conclusion shown by Diamond Cluster International Inc. in their Global IT…


ING signs MoU with LogicaCMG
By Danny
LogicaCMG and ING have signed a six-year, outsourcing activities MoU estimated at over 200 million euro. The outsourcing deal is for application development, application maintenance and testing of IT…

Convergys Awarded for Outsourcing Services
By Danny
CRM magazine has awarded Convergys Corporation the 2006 Service Leader Award for outsourcing services. “Winning this award for the second consecutive year is a great testament to our employees…

Wipro in race for American Express IT outsourcing deal
By Danny
According to market sources, Wipro and other software vendors in India are aggressively bidding for an American Express IT outsourcing deal estimated at over $1 billion. The bank's $4 billion...

Outsourcing remains strong but continues to flatten: Pulse Surveys
By Danny
Advisory firm EquaTerra has released the results of is quarterly “Outsourcing Pulse Surveys”. The survey for the first quarter of 2006 covers outsourcing trends in HR, IT, finance and…



Research and Markets offers ‘Outsourcing Clinical Development’
By Danny
With the many challenges facing large pharmaceutical companies nowadays there is a need to reduce development costs by as much as 30-40%, while at the same time significantly shortening development….

Philippines could get 450,000 call centre jobs in the next five years
By Danny
According to the Trade Union Congress of the Philippines (TUCP), the country could corner as many as 450,000 call centre jobs from the off shoring operations of US corporations over the next five…

Fed: Outsourcing helps U.S. economy
By Danny
Thomas F. Siems, senior economist at the Dallas Federal Reserve, said that offshore outsourcing results in overall economic gains in the long run. According to him, lower consumer prices, better...


Payroll outsourcing offers leg up on competition
By Danny
Payroll management can become complicated, costly, and time consuming for businesses of all sizes. This is why payroll outsourcing is becoming an easy solution to solve this problem. Companies are now…



Cambridge Among Top Three Global BPO Providers: Global Services
By Danny
The BPO division of Cambridge Solutions Ltd. Has been named one of the three ‘Best Performing BPO Providers’ in the world and one of the 100 top ranking global services providers by…


Bulgaria develops as outsourcing destination
By Danny Bulgaria has been appearing in various rankings of the most attractive outsourcing destinations. The types of services mostly outsourced to the country include data processing, software programming…


Growth in Contact Centre Outsourcing Market
Offshore outsourcing is a global phenomenon that has driven the growth in the contact centre outsourcing market in Asia-Pacific. The trend is expected to continue to be the key growth driver. Since the contact centre outsourcing market in Asia Pacific continue to witness strong growth, the demand for skilled workers is increasing day by day.

Outsourcing Tips for Small Businesses
The promise of saving time and money by exploiting technology and inexpensive labour has driven companies to opt for outsourcing. Experts believe that millions of jobs will be outsourced to overseas destinations in near future. Before outsourcing your business, you must know the strengths and weaknesses of your business. Selecting a vendor is tough for large companies with huge budgets. You can browse through several websites to find a reliable partner. The following websites can be helpful on this regard:
Elance
iFreelance
ScriptLance
Rent A Coder
Get A Freelancer
UAE: Hot Destination for Outsourcing
After India, Ireland, Malaysia and Philippines, now it is the turn of UAE to join the outsourcing brigade. The Dubai Outsource Zone (DOZ) development was first announced in 2004. The project was the brainchild of Dubai Holding. During the launch of the project, it was not expected that it would be huge success. However, it happened. Demand for space within the zone from both regional and international companies has already exceeded expectations.

Choosing the Right Time for IT Outsourcing
Outsourcing has become a "buzzword" in the industry today. Many companies are outsourcing their entire IT operations in order to bring more efficiency and effectiveness. Cost saving is also one of the major factors that drive the outsourcing growth. In the past, outsourcing was used to farm out the undesirable jobs. However, situation is completely different today. IT outsourcing has become a common phenomenon in the software industry. It is important to make a perfect analysis before finding out the right time to outsource your business operation.

Outsourcing Work Saves Time
Small businesses often do not have a HR department to manage their resources. Hence, they hire professional in order to guide and manage their staff. That is not always a preferable option. Outsourcing is one of the few options that help companies enhance their capabilities such as web site maintenance and transactions. By outsourcing their work to a third party business, it saves enormous time and money for the companies. Cost is definitely the main factor. However, time also plays an important role in determining the output. The entire hiring process for any job can be turned over to a professional employer organization, which will also help train employees. The third party will also write performance review forms and create medical and other benefit plans.

IT outsourcing in Western Europe
A new study conducted by the IDC revealed that the top 100 Western Europe outsourcing deals totaled $40.5 billion in value last year. It is driven by nine mega deals signed for a total of $20.5 billion. Five out of nine deals have been awarded by two government agencies. Outsourcing deals are getting shorter in length because customers are less willing to stick to a contract for long periods. Vendors must explore cost-savings in a much shorter time period. The study also revealed that IBM is no longer the topnotch company in the Western European outsourcing industry. Although it signed 14 deals in 2005, the aggregate value was lower than that of BT Global Services and EDS.

Asia-Pacific IT Outsourcing is Booming
According to a recent report, Asia-Pacific outsourcing spending is all set to cross the $10 billion mark this year. In this region, more emphasis is being given on IT outsourcing. Research firm IDC has estimated that $10.5 billion will be spent on IT outsourcing within the region in 2006. As the sector is booming on a high pace, it is expected to reach $16 billion in 2010. In the past decade, the Asia-Pacific outsourcing market has seen significant increase and it is surging further. Besides India and China, Philippines also joined the exclusive club of hot outsourcing destinations. Countries such as Singapore and Hong Kong are also attracting more outsourcing businesses.

Wombs Outsourcing
Outsourcing business is no longer a new concept in the industry now. A large number of firms in the USA and Europe have outsourced their businesses to India and other favorite destinations for better productivity and quality at a low cost. Outsourcing business covers health, law, transactions, finance and other related operations. However, a new concept of outsourcing has come into picture with an increasing number of couples are coming to India in search of cheaper fertility treatment, donor eggs and surrogate mothers. It seems that the West is turning to Indians to carry babies.




Outsourcing: A universal trend
When outsourcing started out as a business model for companies in the U.S., it became the alternative to high costs of operation in the U.S. and found economically viable partners in countries like India. Some years down the line, the practice of outsourcing work to save time and money is no longer a one-way-traffic, but has developed a cyclic pattern. U.S. countries outsource to India, India outsources to other countries, and so does China to other outsourcing service providers situated in other countries.

Outsourcing of Pharmaceutical Companies
According to a recent study, most pharmaceutical organizations are now shifting their IT-support functions to third-party vendors. This is the hottest trend in the outsourcing industry. Previously, only the IT sector and customer service industry were the part of outsourcing boom. However, the situation has changed now with the globalization of pharmaceutical companies.

Contemplating Outsourcing?
With even small and medium businesses outsourcing their processes today in order to cut back on costs, there are a few precautions they should take before they jump into the fray.

• Consider that the decision may involve transfer of employees
• Realize that software and hardware licenses may have to be transferred to the service provider
• Set standards to measure if delivery measures up to promised levels
• Set rules for handling personal information according to the Data Protection Act
• Anticipate intellectual property issues that may come up
• Decide on the time frame for the contract, and any clauses that deal with disaster recovery and termination of rights
• Agree on a procedure to resolve disputes
• Remember that flexibility is the key to success in outsourcing

Outsourced Work Outsourced
The outsourcing market is looking at a new scenario now – one in which outsourced processes are being outsourced again. Indian IT giants like Tata Consultancy Services (TCS), Wipro, and Infosys Technologies are among those who have opened offices in Hungary, China, Chile, and the Czech Republic. With this emerging trend, India seems to have lost its status as the golden-haired child of the offshoring industry. If India can find labor and skill in other countries, why can’t we? This seems to be the question the USA is asking. It has found suitable answers too, in the form of operations being outsourced to Dubai, Budapest (Convergys), China, the Czech Republic, Hungary (IBM Global Services), and Philippines, Slovakia (Accenture). But India is not out of the running; in fact, it has moved on to performing more sophisticated processes like design and research and development (R&D) for companies in the U.S, rather than just data entry and back office processes.


Costs, Savings, and Outsourcing
You should probably rethink your outsourcing options if you are in it for the cost benefits. A survey by outsourcing advisory firm TPI has found that the outsourcing of information technology and business services results in an average savings of only 15 percent, a far cry from the 60 percent cost reduction claims. With salaries paid to professionals, severance pays, and governance costs making a huge dent in the company budget, organizations are left with only 10 to 39 percent as savings. There's some good news though for those who prefer quality to quantity though; around 21 percent of companies have now outsourced to enhance quality, a substantial increase over the 11 percent that did so in 2004.

Outsourcing Questions
Linda Cohen, analyst at research firm Gartner, outlined the questions to be asked when any organization decides to outsource. Answers have to be provided for:

• WHY – Why should the company outsource? Is it to cut costs or to improve or change business processes? Whatever the reason, it should be unanimous throughout the upper echelons of the company.
• WHAT- What should be outsourced? Only the back office operations, the customer service interactions, or other processes those are strategic to the business?
• WHO – Who should you choose to entrust with a part of your business? Should you choose a start up company that promises much or stick with a tried and tested firm that has been in the market for a few years?
• HOW – The how relates indirectly to the WHO. You have to decide if you are going for customized, high-value solutions, or standardized, cost-effective ones. You also have to coordinate how your internal and external personnel work together, and set a standard to monitor and evaluate performance.
• WHERE – Where should you send your operation? As far away as India, closer home to Mexico, or better, to home-based agents in the United States? This depends on the complexity and range of the operations you are outsourcing, and the control you would like to maintain over them.

Is Outsourcing For You?
If you are looking for ways to cut costs but also expand your business horizons, the “Off-Shoring, Near-Shoring and Home-Shoring: Does it Make Cents for You?” seminar might help you get a few pointers. Organized by the Arizona Technology Council in Phoenix (May 2) and Tucson (May 3), the conference will include speakers who are experts in the field of outsourcing IT, call centre and back office operations to other countries and to home-based agents. For details on how to sign up, or for more information on the seminar, please visit the Tech Council’s website.

Philippines is the Rising Star of Outsourcing
Philippines is taking advantage of it's strengths rather than looking at it's obvious economic problems to drive the outsourcing industry to greater heights. This 90 million nation is subject to a "not to be proud of" economic situation but it has a population where 95% speak English which is a natural advantage to grab a share of the US outsourcing market.

Where outsourcing loses out
Outsourcing can be a boon as experienced by organizations across industries and market segments. However, all discussions relating to the negative fallouts of outsourcing remain restricted to the job market. Is it time to look at other cons of outsourcing ?
Although customer service standards have risen with the increasing appetite to enjoy better service by clients, outsourcing can lead to bad customer service resulting in loss of valuable clients. It has been seen that service standards have become the prime motivating factor for customers to continue with a given service provider and third party outsourcing can lead to
undesirable results in the long run.

Onshore vs. Offshore Competition
Competition between offshore team and onshore team can either be good or bad based on how you manage it. Hence it is important to recognize it and plan accordingly. But first let’s take a look at the how the competitive spirit plays out at various stages of offshore engagement. Please note that this discussion applies equally well to captive offshore team as well as offshore-outsourced team.

Do Outsourcing Certifications Help?
In search for better quality and lower risk many enterprises are now mandating certain certifications for possible candidates for outsourcing. Are they making a mistake? The short answer is "Yes". Even though in many cases over emphasis is placed on the certifications, there is no doubt that having certifications shows that an outsourcing outfit takes quality seriously as a corporate priority and is willing to spend time and resources to do so.

Doing Your Homework Before Outsourcing
Doing homework before getting started with outsourcing is as important as managing the outsourcing relationship once established. Like any organizational decision, outsourcing requires effective management from the outset of the outsourcing evaluation through the life of the outsourcing relationship. The most critical part of getting started right is to first determine the reasons for outsourcing. Even before sending the first RFP or meeting with a potential vendor, the company should have all the stakeholders fill out a questionnaire that should contain, at a minimum, questions such as the following:
1. What are our core competencies?
2. What areas of the corporation take a large share of management time and other resources but are not critical to the survival of the enterprise?…

Terms you should know

Do you think you know every word and acronym of your industry? Are your sure you know the full forms of RFP and FM. (RFP is Request for Proposal and FM is Facilities Management).
A lot of managers talk to their subordinates in short forms and acronyms. They expect their subordinates too understand what they are saying. Chances are plenty that your boss may explain you some of them, if you do not know. But if tend to you ask for the meaning and full form of every acronym, you had it.

Things you should know before outsourcing
The thought of leaving your customer at the mercy of a person who is sitting miles away can give you goose bumps. Every business would like to keep their customer happy and so when outsourcing seems to be inevitable to business all over the world, here are a few points that one should remember before outsourcing their services.

Watchlist for outsourcing
Outsourcing is a double-edged sword. If managed properly, it can reap immense benefits; however, there can be unpleasant surprises also in an outsourcing deal. Outsourcing companies need to take care of factors such as back-end loading, cultural misalignment, preferring quality to size of the deal, and ensuring that a contractual benchmarking clause provides for periodic checks and balances regarding pricing and service quality.

Outsourcing vs. shared services
Two competing trends help companies get more value out of IT operations
There are two current trends in IT with diametrically opposed ponits of view that are worth looking at. The first is shared services, wherein the IT organization becomes the internal service provider to the rest of the company. The second is combined business process and IT outsourcing all done under one roof -- although, of course, that roof is somewhere other than at the company.


Outsourcing the desktop
Outsourcing desktop management can shave costs while bringing relief to an assortment of infrustructure management headaches.
By Dan Littman
In 2003, New York City consolidated 32 autonomous community school districts under a unified Department of Education, creating a vast organization of 130,000 employees serving 1.1 million students. The reorg also brought one IT roof approximately half a million pieces of computing equipment, including about 300,000 desktops and notebooks. According to the Department's CIO, Irwin Kroot, no one at the time really knew how many assets the system had. So Kroot's predecessor outsourced an inventory survey to a division of Dell. "They went door to door," Kroot says, to all the district's 1,200 buildings, to inventory the equipment for an asset managment database.

Is IT Outsourcing Stagnant?
By Stan Gibson
Opinion: Year-end figures show a decline in the value of global contracts.
While there is much talk about outsourcing and services being the future of IT – and IT becoming, in effect, a service—it seems that IT outsourcing is actually not growing – depending on what statistics you look at and which you believe.
TPI, a sourcing advisory company, reported that in 2005, the total value of global commercial outsourcing contracts declined by about 4% to $75 billion, from $78 billion in 2004. The figures come from TPI’s year-end market observations in its TPI Index, a quarterly report on the state of the global outsourcing industry.

Outsourcing: The Russian Revelation
By Stan Gibson
When Daniel Marovitz sought an offshore partner, he scanned the globe. “We talked about Canada, Ireland and low-cost locations in the United Kingdom. But it really came down to India, and Russia,” said Marovitz, chief technology officer for global banking at Deutsche Bank’s investment banking unit, in London.
Marovitz soon found that approaches of companies in those two countries could not be more different – and that a Russian outsourcing provider would best satisfy Deutsche Bank’s needs in maintaining and enhancing its 5,000-user “client-first” CRM (customer relationship management) system for investment bankers.

Outsourcing in India Pays Off
By Stan Gibson
MUMBAI, India—Outsourcing to India has delivered rich rewards for a number companies, freeing up scarce funds to fuel strategic investments and, in some cases, corporate turnarounds. Next up: enlisting Indian partners to revamp business processes.
And those partners are willing. Indian providers are increasingly moving beyond a reliance on labour arbitrage to create intellectual property they can sell to customers. Several large customers told their experiences here at the Nasscom conference.

Why We Offshore Our Software Development Work to Ukraine
By Ismael Ghalimi
At Intalio we started looking at taking part of our software development work offshore in late 2004. During the first half of 2005, we focused our attention on India, flew there a couple of times, talked to about 20 firms and finally engaged with one. After experiencing a significant turnover in the employee base of our offshorepartner, we decided that the model wasn't working for us and that we would be better off keeping all software development onshore, in-house.


Protecting Your Company from IP Theft: A How-To Guide
By Jason Park
Outsourcing situations are fraught with personnel turnover -- whether your internal team experiences it or the service provider does. Along the way, some departing folks may believe they have reasons to hold a grudge against your company. Most companies take care to ensure that new and departing employees have completed human resources files with non-disclosure agreements, non-competition agreements, invention and assignment agreements and varous other forms.....


Go Offshore Without Going off Track
Software development, which can be tricky under the best of cirumstances, gets even tougher when programmers are located thousands of miles and several times zones away. This article should be required reading for any company with offshore software development, whether it's done at a captive center or by a third-party provider. Though the advice is pretty detailed, it boils down to four key points: When it comes to process integration, strive to create consistency between onshore and offshore development teams. Work hard to build relationships........


Crawl, Walk, Run Strategy Leads to Success in Offshore Outsourcing
By Uttiya Dasgupta
Some companies have sucessfully leveraged offshoring to grow their businesses. Others have failed in this arena by incurring "hidden" costs, due to a lack of planning and the inability to implement an appropriate offshoring strategy.
To be successful in offshoring, you should plan to build your internal capabilities step by step. In this article, I share a strategy we advise clients to use, which we cal Crawl, Walk, Run. I also share a few tactics; detailed elaboration of the tactics is beyond the scope of this article. I illustrate my points with a case study I've composed based on the true experiences of several of ours clients in the small-medium enterprise (SME) space, to which I've given the single pseudonym of ABC-software.
Step 1.Discovery
The first step in the offshoring process is to asses your suitability for offshoring.......



Setting Standards
Benchmarking ensures that even after a number of years the outsourced service is just as attractice as it was on day one
When offshoring, both parties sign up complex contracts for the long term. This allows the supplier to spread its intitial cost and risk over a longer cycle and the customer to, in turn, benefit from a reduced annual charge and less frequent reprocurement. Yet, a dominant feature of the traditional domestic and international outsourcing market is that many contracts are terminated early or are renegotiated. Outsourcing solutions can become outmoded or expensive in a rapidly changing market.



Leveraging Services Globalization to Reduce Time-to-Market through Process Transformation
Time-to-market reduction is one of the most important and effective ways to increase market share and product revenue. Yet the question of how to reduce time-to-market continues to confound many executives. This paper explores one way of reducing time- to-market : process transformation through services globalization.
This paper also explores the question; How can process transformation be done more effectively, more cheaply, and more quickly. It will help client organizations take advantage of four unique transformative opportunities that services globalization offers.


Offshore and Nearshore ITO and BPO Salary Report
Global sourcing has become a key competitive necessity for major organizations. Even as other consideration factors become important determinants of a country's success in globalization, cost savings remains they key. While a number of factors affect the cost savings potential of any given global sourcing arrangment, the cost of labour is among the most important. For that reason, we've undertaken - for the second year in a row - the challenge of analyzing salaries across different levels of experience for the most common established and emerging sourcing destinations.
This report analyzes ITO, voice-based BPO, and non-voice BPO salaries in each of 20 key services sourcing destinations - including the Czech Republic, Hungary, Ireland, Israel, Poland, Romania..


An alternative to offshoring
Instead of sending customer service work to India or the Philippines, more are outsourcing work to people in their homes.
There are a few drawbacks for home agents who work for providers like Alpine Access, LiveOps, Willow and Working Solutions. The work is oftern boring and the pay low, there are no benefits and workers must equip themselves with computer, phone line and Internet access. Regardless, says this Sue Shellenbarger column, highly qualified workers are flocking to take jobs with the flexibility that allows them to set their own hours.....

Pros and cons of offshoring
By Jean Paul Vellotti
In 2002, the term offshoring was just starting to enter the American lexicon.
At that time, Smart Sourcing Inc. a Farmingdale company that specializes in offshoring manufacturing to China, approached a local maker of plastic lawn furniture with a proposition to outsource the comany's products. their offer was simple - offshoring would save the company money.
The offer was rejected.......


News and numbers from US IT world
IT outsourcing, especially offshore outsourcing has brought about various changes in both outsourcing nations as well as vendor nations who do the outsourcing work. In US today, IT outsourcing has become one of the hot topics of discussion. While pros and cons of offshore outsourcing are discussed with vigour, surveys to determine its real impact is conducted from time to time. And through all this, the average US IT professional remains a confused self......


Software Outsourcing advantage in Global Economy
International Outsourcing in particular is apparently affecting Global Economy. Software Outsourcing Industry is also growing to this demand across the borders and boundaries. There is demand from all parts of the globe to outsource their work to India from Paris, Australia, European Countries and other big cities. The high value of outsourcing project is lured from US and UK. US based clients are ready to take risk by outsourcing their projects and products to Software Outsourcing firms.....

How to succeed in a global economy
Being a global company used to mean being a big company, but today even the smallest ecommerce firm is a global player by default.
IT has played a significant role in opening up the worlds borders. The internet, email, videoconferencing and agreement on global standards for communication, such as
For human resources, globalisation means we can seek skills wherever they are found in greatest supply. One of the manifestations of this has been the phenomenal rise in outsourcing - once the preserve of big firms, now everyone is doing it.
You don't have to be big to be global, says Phillip Everson, a consulting partner at Deloitte.......



How secure is your outsourced operations?
Steadily, more and more enterprises are exploring the outsourcing strategy, primarily to increase profitability by cutting costs. However, this seemingly attractive strategy comes with certain inbuilt risks, which if not complemented with a mitigation strategy does not create uncertainty for success in long run.
They key question that all organisations, especially the banking and insurance industry, face is: How will the secure information be guided tightly preventing any free flow, leading to any misuse?
Information security raises concerns of:
*Privacy
*Internal misuse of information;
*Intellectual property right infringement;.....



Focus on IT Outsourcing for financial services providers
IT Outsourcing is typically associated with Information Technology, for financial services providers. Look at the banks, which often turn to outside vendors to handle their back-office processing and Internet delivery functions by offshoring. The managers need to examine each discrete branch-related function and at the same time assessing its importance to the overall strategy and institutionss brand image. There is particular function which may be cheaper to handle by an offshoring criteria, those cost saving might be offset the change.......

Offshore outsourcing: Good economics but not always good politics

Around two years after the proverbial slip that became one of the most discussed topics of the 2004 US election, Dr. Greg Mankiw, Professor at Harvard University and a respected economist, has finally thought it apt to explain to the world why his stance of calling outsourcing yet another form of international trade was right. Almost 18 months after quitting as the Chairman of the Council of Economic Advisors (CEA) to President Bush, Dr. Mankiw, often vilified by the anti-outsourcing lobby and blamed by friends of the President for creating an issue for the opposition, gives his side in a discussion paper, Politics and Economics of Offshore Outsourcing, that he has co-written with Philip Swagel, former Chief of Staff at CEA and presently with the American Enterprise Institute.

Outsourcing: No Big Deal Anymore
In the 2004 political season, offshore outsourcing -- the practice of hiring lower-paid service workers in places like India to carry out tasks previously done by higher-paid American workers -- became an important issue.The debate flared after the annual Economic Report of the President was issued in February 2004, just as the Democratic presidential primaries were heating up and payroll job growth was sluggish.
Answering reporters' questions about a section of the report on trade, N. Gregory Mankiw, then the chairman of the White House Council of Economic Advisers, made a statement that would be utterly unobjectionable if uttered in a classroom at Harvard, where he taught before joining the Bush administration and to which he has since returned. The crux of it was this: "Outsourcing is just a new way of doing international trade."

Offshore outsourcing and France

France is increasingly outsourcing its IT jobs to near shore locations that speak french. Frost & Sullivan's Study finds that the French are very strict on the point that their outsourcers speak French and so France is sending its IT jobs to Tunisia and Mauritius. Forrester Research (2004) had put the number of IT jobs expected to go offshore from France at 2,639 jobs. This number was supposed to be consisted of 1,287 computing professionals including 1,352 junior computing staff and operatives. In 2015, the number of offshore jobs is expected to be more than 15,447, of which 8,686 jobs would be for computing professionals and 6,761 junior computing staff and operatives.

Outsourcing IT operations

Outsourcing the IT operations is often viewed as the end to all IT related woes. But mismanagement of the process can result in doubling your troubles. This article discusses some considerations managements should heed. Outsourcing, in the past, was used to farm out the undesirable jobs, but many companies are now outsourcing their entire IT operations: it isn't just for software development anymore. If this is a business decision focused on lowering costs, it's clear that lowering revenues at the same time isn't the desired outcome. That's exactly what can happen, especially in the software industry, but also with IT outsourcing. The consequences are never immediate, however. Companies have many choices when it comes to hiring their workforce for IT operations. They can employ a workforce in-house and hire consultants to handle the really tricky things, have a full-blown staff that handles everything, outsource everything, or varying levels in-between.

How offshore outsourcing is changing the world!

It is a fact that offshore outsourcing as well offshoring is changing the way businesses are being done. Seamless functioning across continents and time zones has revolutionised the business world. The world is now flat for the 24x7 global conglomerates. Here is a closer look at offshore outsourcing, and the global opportunities that it brings. Outsourcing is often misunderstood. Not only do some people within the IT industry find it a threatening term, there are all kinds of new and ever-changing jargon associated with the practice - which should have endeared the practice to IT professionals. 'Outsourcing' is the term commonly used for the practice of companies to subcontract work to third party organizations.

Offshore outsourcing: The answer to all your IT woes?

More and companies are outsourcing their IT related work to offshore service providers these days. And most swear by the services they receive. So is it the answer to all your IT troubles or is it over-hyped? Here is a look at the benefits of offshore IT outsourcing ... It is generally held as a good idea to turn IT operations and especially IT development over to external providers, as it significantly saves on staff, equipment, training and maintenance, as well as it allows customers to concentrate more on business. However, the lack of IT professionals in developed countries reached critical proportions, with 340, 000 vacant IT positions in the USA alone. This fact makes outsourcing increasingly challenging and expensive. The solution is, therefore, to go offshore.

The advantages of offshore outsourcing your IT needs
It is natural for companies that consider offshore outsourcing IT to be concerned about a lot of issues, varying from those relating to security to intellectual property rights. These are valid concerns that should be addressed before outsourcing your software development needs. To develop software inside the company's premises is undeniably safer, but lower cost alternatives nowadays, are enticing.....



Things to remember while outsourcing offshore
It is important to remember certain factors while outsourcing to offshore locations. There is a tendency to outsource and forget till it is time to receive the results. This often leads to the failure of the outsourcing contract, as the success of an offshore contract often depend on fine-tuning things on the domestic front - getting the onshore right.
It is important to remember that a successful outcome to an offshore project may very weill depend upon managing the expectations of your internal customers, as much as communicating correctly with your offshore partner.
Here are a few hot 'onshore' tips from companies who've done it.....

Revelations on the outsourcing world
A study by Chicago-based consulting firm Diamondcluster International has come out with many a revelation about the outsourcing world. It says that IT boom in India will soon be over due to labour saturation. The study lists China and Canada as emerging BPO hubs.
The study further says that there is a significant decline in the number of buyers - 64 percent offshore and 50 percent onshore......


Shatter the myths on offshore outsourcing!
Outsourcing is anavoidable in modern business world. Outsourcing offshore is no longer an issue either. In fact, developed nations are increasingly outsourcing all its routine but essential work offshore to low cost destinations. However, a number of myths about offshore outsourcing and its impact still exist among common people in these countries. Hence, it is important that these false notions are changed and people be made more aware of the long-term benefits of adopting offshore as a business strategy....


The diverse trends of Outsourcing and Shared services
Sharedx services, wherein the IT organization becomes the internal servie provider to the rest of the company and a process of combined business process and IT outsourcing all done under one roof - although, of course, that roof is somewhere other than at the company, are the two current trends inIT with diametrically opposed points of view. This article takes a look at both these practices....



Business skills are essential in IT Outsourcing

The research studies shows that the development of every company whether IT or non-IT industries, every businessman/woman needs some basic business tactics in him/her. Business skills are essential in Offshore Software Outsource and these techniques or fundamentals are not revising in a day. Outsourcing market is huge and wide. It is spread across India and even some other foreign destinations such as Germany, Sydeney, Japan and China. Yet, the Offshore Software Outsourcing demand is not fully satisfied.......



Using Outsourcing Software to Reduce Costs
It became very clear that the World Wide Web is an integral part for the global buisness paradigm when one examines the Internet as a whole. It is being said, workers can get in real touch with outsourcing software development workers in nations such as Zimbabwe or with an Internet Technology professional in city of India likes of Bombay with the simple click with a mouse. With the wide use of these websites, generally it has allowed people to market themselves in different of ways. For instance.......

Outsourcing no longer as cost-efficient
Companies often opt for outsourcing to save costs but according to recent survey IT Outsourcing saves less than ascertained, as the development cost seems to be increasing slowly globally. Many companies have now started to complain about the less cost savings through the Offshore Software Outsourcing and other IT services. These companies are now finding that their service provider is charging marginally bit more and the expected profit of the company is going down.........



The ever-changing world of Software outsourcing
Though long past the nascent stage, the world of software outsourcing is still constantly evolving. Even as the old prayers consolidate their market, new trends and fields constantly emerge and make a mark. Demands on human resources also keep changing, as opportunities open up in new and different avatars. And all these changes can be observed in India, the leader of the outsourcing market.
The budgets initiated for this fiscal period is seeing cut throat competition in Software Development Market. New businesses are empowering and the multinationals are invading India. As we all know human resources are plentiful and the talented and skilled workers are ready to serve the Company in better manner........



IT Outsourcing and trend
IT Outsourcing and Trend represents that how fast the business process in the IT Industry is changing. Increasingly, it is argued that the position and functions of Information Technology (IT) is moving from its former status of functioning as an "enabling" function. It was the function where business strategies and planning could be faster and effectively realized by the companies to that of a true driver. It was also the time where an organization's strategic positioning is pushed by deliberations alarming information technology and services. Companies use to take the help of Onshore Service Providers instead of Offshore Outsourcing. But with the increasing demand and changes in the technology along with the competition in the market IT Outsourcing has also faced the change in the trend of the business.



IT Pros Sound Off on Offshore Outsourcing IT pros aren't, as a rule, knee-jerk opponents of offshore outsourcing. Some, for example, are earning their livings (or at least scraping by) as outsourcing contractors---in some cases, in near-shore locales, such as Canada. Others sanguinely embrace offshoring as a particularly challenging consequence of free trade---or wanly acquiesce to it as an ineluctable force of global capitalism. The upshot, then, is that IT pros are surprisingly nuanced in their objections to, or support of, offshore outsourcing. Even many offshore dissidents acknowledge that there's sometimes a compelling economic case to be made in favor of offshoring, although they vigorously question its logic on other grounds. It doesn't help, either, that outsourcing as a phenomenon---and offshore outsourcing, in particular---are linked in the public imagination with cost cutting, so much so that---rightly or wrongly---the desire to reduce costs is frequently cited as one of outsourcing's most important drivers. This has many IT pros crying foul.

The Offshore Outsourcing history
The idea of Offshore Outsourcing has its basic roots with competitive advantage theory for country like India. The meaning of Offshore Outsourcing has been undergoing several changes since long years. As shifting of manufacturing process to nations that provide cheap labor during Industrial Revolution has take new connotation for scenario of today by starting off. In today's globe IT has became the backbone of businesses organizations thought out all the industry....

The recipe for success in IT outsourcing
According to David Switzer, director of outsourcing services at CTG, an international IT solutions and staffing company, to increase the chance of success in IT outsourcing, companies must increase their focus on creating and managing a successful mixture of supplier relationships that work for them. He was speaking to delegates on the framework for successful IT outsourcing at Interphex 2006.
When it works, outsourcing can help companies to effectively manage costs and labour and improve the overall IT service, however, many IT outsourcing relationships fail when companies take the wrong approach.....



The ways of offshore outsourcing
The buyer and the provider in an offshore outsourcing deal must be aware of what they are getting into. And they must understand the needs of the deal perfectly. In fact in Business Process Outsourcing implementation the most valuable step actually begins before the buyer even decides which process to Outsource and enters into discussions with an Outsourcing vendor. This includes indetification of the operations, both manufacturing and administrative, without which the organizations would cease to be viewed as a source of goods and services......

The need for software outsourcing know-how
It is very important for a company to examine the pros and cons of outsourcing before going for the process itself. However, there is a great scarcity regarding the relevant details in this sector. And often companies have to put in much concerted efforts before getting the relevant data. Hence, there are many companies who go for outsourcing without checking out all its facets. These kinds of deals are the ones that fail to take-off.
To expect from the Offshore Outsourcing team to have a list of software developed would be very unreasonable, so in that one can select what they want........


The advantages of outsourcing offshore software development services
The advantages of outsourcing offshore software development services are manifold. Also distributed Offshore Software Development is a key challenge for almost all the Software Companies. This is a mian reason as to why such companies go for IT Outsourcing and services. Cost, availability of skills and talented professionals and manpower and round-the-clock support and services are some of the key advantages that inspire service providers to look for Offshore Software Development services. Along with this they are also getting the advantage to expand their business globally....


Security concerns worry Outsourcing companies
A Survey conducted among US companies already outsourcing or actively pursuing plans to do so reveals that most of them are worried about the security risks inherent in offshore outsourcing to developing countries. The survey was developed to provide imminent perspectives on the enormity of information security risk peril in outsourcing relations, how companies vision the information security capabilities of seller, and the information security and database privacy dare that the outsourcing companies must address to build the trust and buoyancy of their buyers.......


Cost saving must not be the only objective of outsourcing
The finding of the survey by analyst Gartner, that the desire to reduce costs is the main reason for firms to outsource their IT functions, has alerted the experts who warn that paying too much attention to reducing costs, ignoring other important aspects of suppliers' performance will increase the risk of project failures.
Gartner surveyed 945 IT managers globally, including 300 in Western Europe. It found "reducing costs or improving efficiencies" was the most popular reason for outsourcing IT functions - over half the respondents said it was the main reward they expected from outsourcing.....


Pros and cons of Outsourcing
It is imperative for business houses to be knowledgeable about the pros and cons of Outsourcing before they decide to jump the Outsourcing bandwagon. As outsourcing while certainly an attractive proposition on paper, can spring a nasty surprise on you in practice.
It is important to take a good look at both the advantages and disadvantages of the outsourcing before taking the decision on whether to outsource or not. Make sure you know exactly what you stand to gain or lose by outsourcing your work.
First of all, the advantages of outsourcing for your business are that you'll be able to get done some of the less important jobs cheaper....


Offshore Software Development and Offshoring costs
Last year surveyed of Sand Hill Group executives from about fifty software development companies and found that Offshoring software development has become accepted preparation. Approximately 85% of software companies said they use offshore developers, a growing from about sixty three percent two years before.
Co-founder of Sand Hill Group M.R. Rangaswami said, "software development companies are done an offshore not just a testing and maintenance but they are more dependent on Offshoring than ever before."...

The contract is the most important part of the outsourcing relationship
Surprisingly, contracts are frequently vague about exactly what he outsources responsibility is versus the customers. Without a patrollable boundary, neither side knows with certainty what it should be doing. The result: Each side blames the other when hings inevitably don't get done. The big problem seems to occur when businesses think that outsourcing obviates the need for any kind of corporate technology strategy. Blue Cross Caron discovered that very thing when he walked into the contract from hell. "People here thought [the outsourcer] was going to do everything, but it could only do so much and had only so many resources," he says....


Offshore Outsourcing: why some deals fail?
Offshore Outsourcing process, which is used very frequently in all the industries for the purpose of success in the business process, doesn't really bring success all the times. But the reality is that almost half the times the deals fail because of one or the other reasons and this is the only fact behind all the myths of the success of the process......

Different approach for Software Outsourcing
The balance of organizations' long-term needs with the short-term needs by expanding horizons of Software Outsourcing teams, in practice fairly straightforward goal remains elusive. Very often, the Software Outsourcing project team focuses solely on the piece of pie, building new stovepipe systems that do not fit into existing environment, and prove overly expensive to develop or maintain, they do not reuse the share services and components. It is common to discover, in the same company, enterprise grouping, typically comprising experienced, architects and data administrators. Usually these folks have a wide vision to address the situation, but very often they haven't actually coded, they often propose a data oriented approach instead of a more contemporary object and service-oriented architecture for Software Outsourcing....



The right choice of IT outsourcing
Software Development market in IT Outsourcing is now using strategic trands. The efficiency is lowered when owrked onshore and so gave birth to the new idea of offshore outsourcing. Because the competition is too high and in some particular cases, United States and European IT professionals even go farming rather than own up the situation and get adapted.
So if one asks about the regions of associating with IT-industry that will get quite a short list: India, China, Russia, and Eastern Europe because The International Division of Labor has done its work in the field of IT Outsourcing. Historically these regions had the most efficient


A Simple Way To Use Core Competency and Financial Impact Analysis in Outsourcing Planning
By Nari Kannan
The phrase "core competency" was introduced by C.K. Prahalad and Gary Hamel in a groundbreaking article in 1990 in Harvard Business Review. They wrote that a core competency is "an area of specialized expertise that is the reult of harmonizing complex streams of technology and work activity." Honda Motoc Co.'s core competency is its expertise in engines. The company builds motorcycles, lawn equipment and automobiles around their engines......


Agile Outsourcing: How Agile Methodologies Help Software Development Outsoucing
By Nari Kannan
Scott Ambler, author of books and articles on agile methodoligies in software development, wrote an article in the May 2005 issue of Software Development magazine about his visit to offshore software development companies. He was giving a series of lectures on agile methodologies and outsourcing. He made some powerful arguments for why agile methodologies were more suitable for outsourcing that traditional ones....


Cultural differences cause off shoring problems
Two-thirds of execs say it’s the main reason deals run into trouble…
By Andy McCue
Cultural differences are one of the biggest reasons why offshore outsourcing deals fail or run unto problems, according to new research.
In an Accenture study, two-thirds of 200 US business executives said that miscommunication arising from cultural differences has caused problems when outsourcing offshore….

Finding the Right Balance for Outsourcing
By George Elliot
Before outsourcing should even be considered, reconsider the base from which these decisions are made. It is time to examine every process, every management policy, every initiative, both past and present, and the complexity of the current products or service mix with a ready and willing commitment to establish true lean.
Competing internationally is not just about wages. It is about total cost – design, quality and customer satisfaction. It is about an organization’s and the broader communities’ legacy and the need to work with an integrated and balanced value proposition. It is about the future of the United States…

Outsourcing: No Big Deal Anymore
By Daniel Gross
Lots of services still require face-to-face interaction for people to do their jobs. That is particularly true for the biggest sectors, retail and healthcare. As a result, according to a McKinsey Global Institute study, only 3 percent of retail jobs and 8 percent of healthcare jobs can be outsourced.
In the 2004 political season, offshore outsourcing the practice of hiring lower-paid service workers in places like India to carry out tasks previously done by higher-paid American workers – became an important issue. The debate flared after the annual Economic Report of the President was issued in February 2004…

The Seven Deadly Sins of Outsourcing
These are the transgressions that can doom you to outsourcing hell. Here’s how to avoid them.
Outsourcing is a source of stress, struggle and angst for many IT managers, and no wonder: More than half of outsourcing agreements and up prematurely terminated, according to a study released last year by Diamond Cluster International Inc., a Chicago-based consulting firm. That leaves a lot of companies far from outsourcing nirvana, but it doesn’t have to be that way. We asked IT experts and veterans to talk about the bad decisions and faulty assumptions that can cause your outsourcing project to fall from grace…

How to Survive the Outsourcing Boom
It’s something almost every IT professional worries about: will my job be outsourced?
That’s a valid worry. Undoubtedly, outsourcing is here to stay. Year after year, jobs migrate offshore, forcing American IT workers to scramble for new positions.
In the past, companies use to agonize over outsourcing, says Gartner analyst Diane Morello. But not anymore.
“Now, when I talk to companies, it is assumed that outsourcing and offshore outsourcing are at least candidates for their sourcing portfolio,” she tells Datamation. “There is much less dismay and horror.”



What Makes A Business Process A Good Candidate For Offshore BPO?
By William Martorelli
With significant growth in both customer interest and vendor revenues, offshore business process outsourcing (BPO) is of increasing interest to commercial enterprises, particularly those that have outsourced offshore successfully before in other domains. But what makes for a good candidate process? At the end of the day, any process performed successfully on a remote basis or in a shared services context can be outsourced successfully and any such process can be outsourced offshore depending on audit and compliance constraints…

Outsourcing as a Way to Optimize
By Carol Kendrick
Optimizing service delivery remains to be the constant challenge of companies when it comes to making sure that the firm profits and at the same time manages to cut back on cost and other expenses. Aside from that, there is also a big problem when the demands of customers are not met…

Significance of Offshore Staff Outsourcing in the IT Business World
Offshore staff outsourcing is now becoming a huge trend in the world of business. From large scale, to companies who are just starting up, it is obvious that they have been improving themselves continually to maintain and upgrade their status to survive in today’s highly competitive market.
Having an offshore staff gives you certain advantages aside from the fact that the price is cheap and you don’t have to worry about government tax, unemployment insurance, employee benefits, etc.
These are…

In Outsourcing, It Often Doesn’t Win to be the Lowest Price
All organizations acknowledge the need to be more competitive in their markets. That’s a fact of life in capitalistic economies – increase operational effectiveness while at the same time lower costs. There are varying techniques available to corporate executives for this relentless challenge, and strategic outsourcing is often considered…

Outsourcing Helps – Really
If you think that all outsourcing has done to the US is the job losses, think again.
Two economists from Princeton University revealed that outsourcing does not have a negative impact in the economy. Princeton professors Gene Grossman and Esteban Rossi Hansberg in fact proposed that outsourcing has helped in raising the wages for low-skilled US workers….

Outsourcing good for all sizes

Outsourcing: Good for big business, good for small business

Most companies are dependent on information and communications technology (ICT) to operate effectively in today’s highly competitive environment. Big business has been reaping the benefits of purchasing ICT as a managed service for years.
Multinational manufacturers, retailers, mining groups and financial services companies have accepted that their core competencies are not the management of computers, networks and business applications. But what about the medium-sized business?……






Triumph Over Outsourcing
Outsourcing deals for the past couple of years have shown a considerable decline thus showing that the outsourcing boom has managed to cool down. Though that is the case, it does not mean that outsourcing is close to being a thing of the past.
Though statistics have shown that there is a decline in the number of outsourcing deals, the fact remains that outsourcing is still pretty much a part of the IT industry whether we like it or not. One of the main concerns of IT workers in the US is their hold over their job and the security that their job would not be sent offshore in the months to come…

Turning outsourcing into a plus takes time and skill As jobs hopscotch across the globe, the outsourcing model will face obstacles By David L.Margulius
I made my annual trip to Florida’s Walt Disney World last week. I’d been there as a kid, but funny how it wasn’t till 30 years later that Disney’s “small world” theme really sank in – at the Gartner Outsourcing Summit.
At the conference hotel, the scene was all-American, with young families getting on and off the monorail and kids clutching stuffed animals. But as keynote speaker and former MIT professor Micheal Treacy said, those kids could be in for a big surprise in a couple of decades. “We’ve dodged the bullet,” Treacy told the crowd of greying40-something IT and procurement managers. “We’ll be retired before the full force of this really hits.” But our kids may find out later in their careers, he warned, that no job is sacred, and all work will eventually migrate to the place where it can be best done.

The outsourcing debate
THE political heat around outsourcing has cooled as the threat it once seemed to pose to western service jobs has diminished. The emphasis now is on improving the process of outsourcing, both at home and offshore. In other words, if you have to do it, try and do I better…

Now for the hard part
NOT once in a decade. Not once in a millennium, says Manish Sabharwal, boss of Team Lease, India’s biggest temporary-employment agency, of the opportunity India enjoys in 2006. It’s once in the lifetime of a country



Flextronics software
FROM his office in Gurgaon, a boom-town next to Delhi, the future looks rosy to Arun Kumar, boss of Flextronics Software Systems (FSS), and one of the architects if India’s information-technology triumphs. Competition is emerging, but the opportunity is so large, that things seem set to fair for the next five years at least, Kohlberg Kravis Roberts (KKR), most famous of American private-equity firms, seems to share his optimism…



IT Job Losses: Don’t Blame Off shoring

A study finds that automation of tasks has been more responsible for information-technology job losses than outsourcing to countries like India

Automation of tasks has had more impact on IT job losses than offshore outsourcing to low-cost locations such as India, according to a study be the Organisation for Economic Co-operation and Development (OECD).

Don't Be Afraid of Offshoring

Diana Farrell of McKinsey Global Institute takes a close look at the workforce in China and India and says U.S. workers have little to fear

Both India and China have profited handsomely from their young, able, and seemingly unlimited workforces over the past two decades. India has built itself into a global services powerhouse, moving from simple customer help lines to more complex tasks such as software design, investment banking research, and medical diagnosis. And while far more Chinese work in factories than services operations, a number of pharmaceutical companies and software houses have recently set up research operations on the mainland.

Culture Clashes Harm Off shoring

An Accenture study shows cultural differences, such as communications styles, are by far the biggest reason outsourcing deals fail

Cultural differences are one of the biggest reasons why offshore outsourcing deals fail or run into problems, according to new research.

How BofA Banks on Off shoring
Having grown via acquisition, it's used to having far-flung operations. Now with centres in Asia, it's able to keep projects moving 24 hours a day

For Bank of America, the decision to begin off shoring was, to borrow from the old adage, about time, not money. Granted, the Charlotte (N.C.)-based banking giant did realize significant cost savings by shifting hundreds of technology and analytical jobs to India, Singapore, and China. Bank execs estimate that they've saved roughly $100 million since 2001 by off shoring some work that was previously performed in the U.S. and Britain. But just as important was the dramatic savings in time that BofA realized when it developed new products and services.

R&D Offshoring: Is It Working?

Companies are increasingly moving projects to India and China, but they haven't fully integrated or exploited this brainpower potential

If you're an executive planning a new research and development center, where would you locate it? For just about anyone from a big company, that's a no-brainer: Either India or China. A just-released survey of 186 of the world's biggest corporations found that 77% of new R&D centers over the next three years will go up in one of these two emerging economic superpowers.

Britain's Software Biz Needs Better Image

To thrive, the industry must combat a geeky reputation at home and contend with the rise of offshoring, says a new report

The UK software industry is struggling to deal with the rise of offshoring, a 'geeky' image and the country's IT skills gap - but there's still hope.

Off shoring: Spreading The Gospel

Outsourcing's inner circle has deep roots in GE and McKinsey. Here's how they caught the fever

After General Electric Co. (GE ) spun off its outsourcing subsidiary, Genpact, two years ago, Chief Executive Pramod Bhasin figured he wouldn't be seeing much of his erstwhile GE colleagues. But these days, Bhasin sees plenty of the old gang. That's because GE has been so successful with its outsourcing operations that its managers continue to chant the mantra even after they have left the company. Today, GE veterans are in key positions at Home Depot (HD ), Honeywell International (HON ), Solectron (SLR ), and United Technologies (UTX ), among others, giving Bhasin a huge base of potential customers with a deep understanding of just what his company can do for them. "We go after GE alums," Bhasin says.

Learning To Live With Off shoring

Few management trends have been as defining -- or as divisive -- for the American economy over the past two decades as the practice of companies moving employment or business functions to other nations that can do the work cheaper or better. Call it outsourcing or off shoring, but one effect is the same: job loss at home.

Five Offshore Practices That Pay Off

Outsourcing is still more of an art than a science. But it's now part of the corporate toolkit, and it's important to use this tool right.

From Dell Inc. to Reuters Group PLC, corporations have run into trouble as they've shifted jobs offshore. But they've persisted since the process is so critical to corporate success. Take Bank of America Corp. It attracted media attention when it laid off hundreds of information technology workers after forcing some of them to train their Indian replacements. But BofA learned from its mistake. "It caused us to make a greater commitment to [retraining] our associates and to explaining the context of changes in the marketplace," says Barbara J. Desoer, BofA's global technology, service, and fulfillment exec. Now BofA gives its workers six to eight months' notice before an offshore move, enough time to train for new assignments or to hunt for jobs.

The Future Of Outsourcing
How it's transforming whole industries and changing the way we work

Globalization has been brutal to Midwestern manufacturers like the Paper Converting Machine Co. For decades, PCMC's Green Bay (Wis.) factory, its oiled wooden factory floors worn smooth by work boots, thrived by making ever-more-complex equipment to weave, fold, and print packaging for everything from potato chips to baby wipes.

Call Centres In The Rec Room

"Home shoring" takes off as moms and others provide an alternative to off shoring

Three years ago, when the off shoring debate was in full fury, the director of vendor relations at 1-800-FLOWERS.com ran a pilot project to see if the company should be taking advantage of the new labour arbitrage. Within weeks, the trial in India bombed. For the executive in charge, Lou Orsi, it was a reminder that customer service is as much about psychology as technology. Florists often double as condolence therapists, interior design coaches, and relationship strategists. "The folks were difficult to understand," says Orsi. "We were afraid that we would lose sales, and we couldn't risk that." The company also needed to pour on the labour during spikes like Valentine's Day. (When it came to answering customers' e-mails, though, the dazzling prose of the Indians -- many of them PhDs -- outshone that of the Americans, most of whom had gone only to high school. So Orsi left some of the e-mail jobs overseas).

Can Latin America Challenge India?

With proximity to the U.S. and free trade agreements in place, many countries south of the border are building up their outsourcing infrastructure

Softtek, a Mexican software development company, has been in business for 23 years, but it wasn't until 1997 that its founders realized they had something unique to offer U.S.-based clients: proximity. Until then, Softtek had been plenty busy helping Mexico's second-largest bank and other companies develop customized software and managing their info-tech systems.

HSBC's Lessons in Outsourcing

The bank's software-development center in Pune, India, has become one of its most important operations. Here's what HSBC learned in the process

The financial-services industry leads the pack when it comes to outsourcing technology development and business processes. Citigroup (C ) and Bank of America (BAC ) were pioneers, but now banks across the world are outsourcing their tech support and maintenance, administrative back offices, and even customer service.

Home shoring: Beyond Call Centres

Silicon Valley start-up oDesk helps companies’ find – and monitor – at home labour for a growing roster of jobs.

Susanne Bullo is a capable software programmer who until recently had few job options. She is a stay-at-home mom who has three young children and helps care for an elderly father with diabetes. Although she lives minutes from the Redmond (Wash.) headquarters of Microsoft (MSFT), Bullo's commitments keep her from pursuing a career at the software maker. It doesn't help that she's self-trained and female -- traits viewed suspiciously in the geeky programming world. "I see tons and tons of men out there with four-year degrees getting different jobs and work," she says. She managed to find contract work, but it wasn't easy.

British Firms Drive Outsourcing Boom

Demand will rise by 50% annually for each of the next two years. Asia leads, but former Eastern Bloc countries will benefit, too

Demand for offshore outsourcing services among UK and European companies is set to increase by 50 per cent per year over the next two years, according to Gartner.

Sub continental Drift

More Westerners are beefing up their résumés with a stint in India

After a year answering phones for Swiss International Air Lines Ltd. In a Geneva call centre, Myriam Vock was eager to see something of the world. So she packed her bags and hopped a plane to India. Two and a half years later she’s still there, sharing a five-bedroom apartment in an upscale New Delhi suburb with four other foreigners.

Contracts Key in Outsourcing Success

Analyst reports business outsourcing contracts, especially for IP protection, are too lax. Country differences must be addressed.

Businesses are increasing the risk of offshore outsourcing disaster by failing to draw up tighter contracts when dealing with overseas service providers, according to analyst Gartner.

Outsourcing Savings Deemed “Unrealistic”…

How much does outsourcing really save? Research says the average is just 15%. It seems that early figures were over-hyped

Outsourcing cost savings have been massively over-hyped with the actual cost reduction averaging just 15%, according to new figures from sourcing advisors TPI.

Asia warms to network Outsourcing

The mounting demand for managed networks in China, India, Malaysia and Thailand is driving the Asian managed services market, according to latest research

A new report from IDC has revealed that the biggest growth in demand for managed networks in 2006 will come from China, which is forecast to grow by 47.3% compared to 2005. Thailand is a close second at 46.5%, while India and Malaysia are expected to register growth rates of 25.2% and 22.6% respectively.

Outsourcing: The Quiet Revolution

By 2010, outsourcing for most video-game publishers will represent about 40% of development money spent.

With all the talk of video game development costs spiralling upwards as we head into the next generation, developers need to do something to keep their projects within an acceptable budget. A new report from media research company Screen Digest suggests that developers are increasingly turning to outsourcing to combat rising costs, and that this trend is likely to continue.

Call Centre? That’s so 2004

Outsourcing shops are moving fast into higher-paying businesses

Americans, it seems, hate calling a help desk or customer service number to find an Indian on the line. Well, guess what, America? India doesn’t particularly want to talk to you, either. As india’s top companies get more sophisticated at taking over outsourced work from U.S. and European multinationals, they’re finding that the lowest end of the business – call centres – just doesn’t pay anymore.

The benefits of Outsourcing for Small Businesses

Outsourcing – the practice of using outside firms to handle work normally performed within a company – is a familiar concept to many entrepreneurs. Small companies routinely outsource their payroll processing, accounting, distribution and many other important functions – often because they have no other choice. Many large companies turn to outsourcing to cut costs. In response, entire industries have evolved to serve company’s outsourcing needs.

The Ongoing Allure of Outsourcing

S&P says the data processing & outsourced-services sub industry looks good – and not just because of potential buyouts.

Amid a general upturn in M&A activity, companies in the data processing & outsourced-services sub industry have recently been at the centre of media speculation about potential buyouts by private equity firms or other potential acquirers. While acquisitions could be catalysts for stock price growth, Standard & Poor’s favours the sub industry for fundamental reasons.

China, India Ahead in IT Services Growth

Expect China to overtake Australia as the largest services market by 2010, and India will displace Korea as the No.3 market a year later, according to IDC

The Asia-Pacific IT services market is poised for further growth, riding on the success of the Chinese and India markets, according to the latest research from IDC.



2005



Outsourcing seen at $300 billion
By Danny
A recently released Nasscom-McKinsey report stated that India’s BPO and IT industry could see a near 10-fold growth from $17.3 billion at present to $166.5 billion in 2010.

Gartner: China will challenge India’s IT domination by 2008 with improved English proficiency
By Danny
Global research company Gartner said that China will challenge India’s IT leadership by 2008 through the country’s improved English proficiency.
The Chinese government is placing more importance on mastering the English language as Beijing prepares to host the 2008 Summer Olympic Games. In addition, the government is encouraging Chinese IT companies to learn from India’s experience in the software sector and replicate it.


Bulgaria lands in Top 20 of global outsourcing destinations
By Danny
Bulgaria has debuted in A.T. Kearney’s annual ranking of the leading off shoring locations for service activities. The country ranked 15 out of 40 destinations that are part of the Global Services Location Index.

New Idiot’s Guide Tackles Outsourcing
By Danny
From the makers of the Idiot’s Guides series, a new book that shows the ins and outs of outsourcing is now available for business owners and consumers alike. “The Complete Idiot’s Guide To Successful Outsourcing” by small business owner and outsourcing expert Gene Marks shows that vast opportunities and challenges that outsourcing provides.
The book details how to evaluate and successfully implement outsourcing. It discusses many topics such as the historical and global issues of outsourcing, the need to outsource, costs and benefits of outsourcing, tips on hiring and managing outsourced help, and compliance in outsourcing.


Epson plans to make India outsourcing hub
By Danny
Imaging Products Company Epson is looking at India to become its outsourcing centre for software development. The Japanese-based company plans to expand its products range and establish itself as a technology driven company.
According to Epson executive vice president and chief financial officer Toshio Kumura, India would be the primary choice for software development intended for electronic devices being developed for commercial purposes.


Outsourcing boosts economy: British official
By Danny
Sir Digby Jones, director general of the Chamber of British Industry, said developed countries should not worry over job losses due to offshore outsourcing. He explained that offshore outsourcing actually drives an economy upmarket where there are big rewards.


Outsourcing boom continues
By Danny
Outsourcing continues to grow as UK-based BG Group PLC announced plans to outsource the billing of 18 million customer accounts to India. A spokesman for the company said, “We are in the process of introducing computerized customer billing system some time next year and 18 million customers’ billing accounts will be outsourced to India.”

Offshore outsourcing sees continued rise
By Danny
According to a research by sourcing advisory company TPI, offshore outsourcing will see more growth as more than 80% of large companies plan to increase their offshore outsourcing activities.
The research which surveyed 100 senior UK executives showed that 81 percent of companies plan to increase offshore outsourcing over the next three years. Conversely, only 4 percent of the respondents believed that offshore outsourcing would see a decrease in activity.

Ernst & Young: Indian Pharmaceutical Industry Holds a Competitive Advantage
By Danny
Global consulting firm Ernst & Young said that India’s pharmaceutical outsourcing sector has a solid competitive advantage in global pharmaceutical outsourcing sector has a solid competitive advantage in global pharmaceutical innovation, patenting, manufacturing and regulation.

A New Trend In Outsourcing
A new trend in the outsourcing industry has emerged in India. International financial organizations – especially those under the IMF or World Bank – are now starting to invest in outsourcing start-up…
Outsourcing Less Extensive Than Assumed
By Danny
A new research by Arizona-based CAPS: Centre for strategic Supply Research and Chicago-based management consulting firm A.T. Kearney revealed that businesses do not outsource a substantial bulk of…

Russia Poised to Capitalise on Outsourcing
Leonid Reiman, Russia’s Ministry of Information Technologies and Communications (MITC), launched the country’s campaign to become “the next global leader in outsourcing.”
According to TechWeb’s W.David Gardner, over 250 Russian firms are currently involved in offshore software development.

GoToMeeting: Offshore Collaboration As It Should Be
By Creative Web logging
Off shoring entrepreneurs have a wide range of free collaboration tolls to choose from. There are web logs, instant messengers, and email, among a lot of other things. However, these methods may not be the most flexible or even secure means of getting a message across… and when it comes to networking many users at a time, they can even be totally useless.



Outsourcing Hits The Mainstream
By Danny
According to a recent study by Data monitor, outsourcing is currently experiencing a period of “super growth” that is pushing it into the mainstream.
The study stated that the United States, the leading outsourcer, and the United Kingdom are now increasing outsourcing operations. Moreover, countries like India and the Philippines would likely benefit from this.

Outsourcing Staff Attrition
By Danny
In a study on worker retention in the Indian outsourcing market, over 50% of respondents said that lack of growth, desire for better job content, mismatched expectations, and dissatisfaction with policies were the top reasons for leaving their jobs. Additionally, 39% of respondents said that night shifts, monotony of work, and salary were factors for quitting.


Smart Outsourcing is the future
By Danny
A new outsourcing business model which shifts focus from blind outsourcing to managed outsourcing is emerging in the industry. In the ‘Managed Competition’ model, instead of enlisting the services of a major service provider, companies outsource to a number of selected vendors that match their specific segments of work. In this way, clients are able to set their own standards of performance for their chosen service providers.

Gartner: Companies Outsourcing Customer Services Will Fail by 2007
Research firm Gartner said that around 80% of companies that outsource customer service functions would fail by 2007. Gartner stated that a diminishing work force and unmanaged offshore operations are the main reasons for the failure. They added that 60 percent of these companies would face problems in the form of client defections and hidden costs (which will cancel out cost savings) by 2008.


How Long Can Price Advantage Drive India’s Outsourcing Boom?
By Danny
Analysts are now questioning how long would India’s favourable currency differential with the US – 44 Indian Rupees to 1 US Dollar – drive the country’s outsourcing boom. As India becomes richer (with the Rupees gaining against the dollar) analysts ask what effects this would have on the country’s outsourcing industry.

Outsourcing from Asia to Grow Rapidly
By Danny
A study by ACA Research said that 60 percent of call centres in the Asian major outsourcing markets expect to expand in the next 12 months.
India leads predicted growth at 64%, followed by the Philippines at 53 percent, and China at 50 percent. Last year, China, South Korea, India and The Philippines were the leading performers. Also, most countries have developed and upgraded their telecommunication systems in the past months.

The new outsourcing kid on the block
By Danny
Costa Rica’s outsourcing industry is growing strong as it builds on existing outsourcing contracts, and improves its IT expertise.
The country is now part of the multi-billion outsourcing deal between Proctor & Gamble and Hewlett-Packard. It also performs advanced design work for semiconductor giant, Intel. Because of this outsourcing boom, Indian Minister, Rao Inderjot Singh, said that his country would establish a $2 million Regional IT Training Centre in Costa Rica. Costa Rica has become the centre for allied countries in Central America and the Caribbean region.

Frequently Asked Questions on Offshore Outsourcing (part1)
By Danny
Here are come answers to your questions about off shoring outsourcing.
1. Why is work going offshore?
Work is migrating offshore because of the following reasons. New technologies (Internet, voice over IP, enterprise applications) make it easier to manage labour in the global economy. Also, competition and cost management push companies to go offshore when their competitors do so. Lastly, the global economic downturn makes companies focus on increased return on their IT investments.


2. Which industry is leading the off shoring wave?

Frequently Asked Questions on off shore Outsourcing (Part 2)
By Danny
Here are more outsourcing FAQS.

4. Which country is dominating the off shoring market?
India dominates the off shoring market due to the country's established IT companies, favourable wage differentials, and high English proficiency. Notably, India has about 2 million graduates -- 250,000 of which have degrees in engineering and computer science.

Tax incentives are expected to spur growth in the country's business process outsourcing industry. Since 2000, IT companies have enjoyed a ten-year tax holiday that reduced tax rate from 36% to 15%.

5. What is the growth trajectory of off shoring in India?…

Frequently Asked Questions on Offshore Outsourcing (Part3)
Here is the last installment on outsourcing FAQs.

7. Who are some well-known offshoring companies?
Some of the top BPO service providers include:
India - Nipuna, Progeon, Spectramind, WNS
Philippines -- eTelecare, Ambergris Solutions
Russia -- LUXOFT

Careful planning is needed before selecting an offshore vendor. Most companies select vendors based on their BPO service specialty. Some companies select a country first, and then choose the top vendor there. Overall, it is advisable to select an operational model before a vendor.

8. How do you develop an offshore outsourcing strategy?……

Mid-Sized Contracts Drive Outsourcing Boost
By Danny
Market research firm, Datamonitor, reported that business-processes outsourcing increased the value of information technology services by 37 percent last year. Mid-size outsourcing contracts were largely responsible for the industry's growth from $118.9 billion in 2003 to $163 billion in 2004.


Analysts say business outsourcing must change
Don't just rush into a deal
Many firms are outsourcing without thinking it through first, according to Gartner.
The analyst group is advising organisations to be much more disciplined in the way they handle outsourcing contracts.
Gartner outsourcing expert and VP Linda Cohen says outsourcing to date has been applied in a tactical, ad hoc way as a cost cutting exercise or as a solution to a specific problem, and instead needs to be thought out at a strategic approach.

Strategies in Data Center Outsourcing
The concept and scope of data center outsourcing has changed over the years. One of the measures of this change is the reduction of contract periods. According to Deloitte Consulting, contracts are now of 3-5 years instead of 6-10 years seen at the turn of the millenium. Outsourcing companies are also looking for specialized providers and , as Gartner reports, large deals involving only one service provider are now a rare commodity. The objective of an outsourcing contract is nore more limited to saving costs.

Innovation blowback: Disruptive management practices from Asia

Emerging markets such as China and India have become breeding grounds for new management processes and practices that help companies to maintain or even improve the quality of their products and services while simultaneously slashing prices. The disruptive impact is now confined to developing countries, but "blowback" from this surge of innovation could quickly be unleashed on the rest of the world. To meet the challenge, established businesses must learn new skills—not least important, an ability to orchestrate complex networks of specialized enterprises. The take-away In Asia, managers need a "clean-sheet" mentality to exploit mass markets and compete with best-in-class companies. Merely stripping costs from existing products will prove inadequate. Capturing the full offshore experience could be critical to survival back home.

The onshoring option

Not all of the developed world's manufacturing jobs are destined to move to low-wage countries. Some manufacturing is best kept local, even in expensive locations like California. At least two-thirds of that state's manufacturing jobs are in capital-intensive or customer-service-intensive industries that would benefit little from offshoring to cheaper production locations.

What global executives think about technology and innovation

A survey uncovers shared perspectives on the challenges now facing companies, but IT execs must still sell tech innovation to business leaders. Sam Marwaha, Parul Seth, and David W. Tanner A recent McKinsey Global Survey of Business Executives1 suggests that technology executives are more bullish about innovation and automation than are their business counterparts and see managing global scale and finding skilled people as two of their biggest challenges.

Sizing the emerging global labor market

Rational behavior from both companies and countries can help it work more efficiently. Diana Farrell, Martha A. Laboissière, and Jaeson Rosenfeld 2005 Number 3 The topic of offshoring generates extreme differences of opinion among policy makers, business executives, and thought leaders. Some have argued that nearly all service jobs will eventually move from developed economies to low-wage ones.1 Others say that rising wages in cities such as Bangalore and Prague indicate that the supply of offshore talent is already running thin.2

How France can win from offshoring

The cost benefits have started to tempt more and more French companies. Instead of resisting the trend, policy makers should explore the ways France could gain from it. Tony Blanco, Diana Farrell, and Eric Labaye Web exclusive, August 2005 When it comes to offshoring, France is a newcomer compared with the United States, the United Kingdom, and even Germany.1 From 2002 to 2004, offshoring accounted for only 4 percent of all jobs lost in France, and most of them were in manufacturing rather than the office work that UK and US companies increasingly move to countries with low labor costs. But the offshoring of service jobs is bound to accelerate as French companies strive to match the efficiency of their foreign rivals. With French unemployment above 10 percent, offshoring has already created anxiety among workers in France and sparked protectionist sentiment there. The entry of ten lower-wage countries into the European Union in 2004 raised the level of angst, as did recent government-commissioned reports on the challenge France faces in restoring its competitive position in the global economy.2

How Europe’s banks can win in tougher times

The winners in retail banking will speak the language of consumer products: customer service, quality, branding, and market segmentation. Marc Beaujean, Dirk Reiche, and Charles Roxburgh Web exclusive, June 2005 Retail banking in Europe has reached a crossroads. After a decade of strong profits, rising shareholder value, and consolidation in most countries, the sector is in danger of running out of steam. Management teams urgently need to find strategies for growth, either domestic or foreign.

Outsourcing grows up

Many outsourcing deals are tantamount to strategic divestitures and joint ventures. Executives should start treating them that way. David Craig and Paul Willmott Web exclusive, February 2005 When companies first started thinking about farming out nonstrategic functions—such as payroll, IT maintenance, facilities management, and logistics—their goal was to reduce costs. Today, however, these corporations regularly contemplate outsourcing core operations to third-party specialists in order to improve operational performance. Many such deals are big and strategic enough to qualify as "bet the company" arrangements involving a complex mix of people, processes, and assets. Indeed, almost 100 megadeals (contracts with values of greater than $1 billion) have taken place in the past ten years, with 15 in 2003 alone.



The journey to Outsourcing: Successful Transitioning Through Selecting the Right Provider.
Joanna Young
No company wants to follow the path of outsourcing, only to unwittingly approach a pitfall during the transition phase. Mirant Corporation, an international energy suuplier with headquarters in Atlanta, Georgia, certainly wanted to avoid this potential calamity, as it turned to outsourcing in the first place for solutions to calamity-type business challenges.


Lab Develops Outsourcing ROI Formula
Word is "out" that adjunct laboratories of major academic institutions are "in" as top-choice outsourcing providers. During the past year, for example, 170 U.S. and international clients outsourced highly-critical and strategic-differentiating processes to the National Institute for Aviation Research (NIAR), a Kansas Technology Enterprise Corporation Center of Excellence at Wichita State University in Wichita, Kansas.


Trends in Outsourcing Printing and Publishing
Jerri L. Ledford
Imagine, if you will, what it would be like to never handle another piece of paper again. No bills, no magazines, no books, no newspapers and no advertisements would clutter your world. It's the ultimate vision of paperless society, but it's met with resistance at every turn. Studies have shown that people prefer to have some paper in their lives. That doesn't necessarily mean they want the clutter that exists today, but there are certain pieces of mail and printed entertainment that consumers would rather just touch.


Keeping up with Trends in Outsourced Packaging,
Joanna Young
Sally Shopper clutches her shopping list in her hand, navigating her way through the aisles of the giant computer store. She enters the software applications aisle (her nephew would love a computer game for his birthday). A brightly colored, sparkling box stands out among the assortment of applications. The box promises hours of educational entertainment in outer space, stimulating graphics, several gaming options, and a free coloring book. With the shiny new game in her basket, Sally moves on to tackle other critical purchasing decisions.
Next stop: tomorrow's lunch. Sally makes her way to the canned-meats aisle in search of tuna. These nice pouches look so much fresher than cans, she thinks, not to mention easier to open and less mess. So, into her cart go three pouches of fresh and convenient tuna. And off she goes.

It never occurs to Sally Shopper how the multifaceted system of packaging has affected her buying judgment.

At the shelf level, a consumer's decision-making process occurs within three seconds. This isn't a lot of time to influence a customer. As Paul Klebahn, director of sales at service provider Software Packaging Associates Ltd. (S.P.A), states, "Companies have one chance of getting it right, on the shelf. Usually in the matter of a sound byte, the package needs to emphasize the 'why to buy'."



Tapping the Power of Outsourcing to Achieve Innovation
Kathleen Goolsby
Suppose your company is in a very, very tight competitive market and you've come up with an innovative idea for product development … but there are technical challenges to getting there. Or suppose you've developed an ingenious idea for meeting a crucial need in today's society; but you have limited funds for starting a new business, let alone developing and rolling out a product never before marketed.



Mechanisms Necessary for Strategic Outsourcing Relationships.
Kathleen Goolsby The genius of outsourcing is that it is not designed to be shoehorned into achieving just tactical, bottom-line-objectives – offloading tasks, people and capital resources to a service provider. It is also designed to be strategic in nature, enabling buyers and service providers to innovate and create products and services that become competitive differentiators that can add to the buyer’s top-line growth.

Identity management
Dr. Alok Aggarwal
Identity management (IM) is a process used for authenticating and tracking individuals or objects with the help of various technologies. It enables organizations to facilitate and control their users’ access to critical online information, while protecting confidential personal and business information from unauthorized users.

Interveiw of Mark Hodges

I recently chatted with Mark Hodges, co-founder and chairman of the board of EquaTerra, a multinational outsourcing and insourcing advisory firm, upon his being named Sourcing Consultant of the Year 2004 and 2005 by an independent panel of judges at the HRO World conference in April. I first interviewed him back in 1999, when he had sold G2 Research, Inc. to what was then GartnerGroup's Dataquest and was helping launch Exult, Inc., the world's first comprehensive HR outsourcer (since merged with Hewitt Associates in 2004). He also established the BPO practice for TPI, Inc., the industry's first ITO sourcing advisory firm, before moving on to found EquaTerra.


A CIO conversation with David Guzman of Owens & Minor
Four years ago, Owens & Minor Inc. was perfectly happy with its outsourcing agreements. The Richmond, Va.-based Fortune 500 Company, which is the country’s leading supplier of medical and surgical supplies, had great relationships with IBM Corp. and Perot Systems Corp. So why did Owens & Minor CIO David Guzman rip up the contracts and have the vendors bid for his business? Ultimately, his decision turned IT into an indispensable business driver that operates with surgical precision and gives a lot more than it takes.


Is offshore outsourcing being eliminated for the State of Wisconsin? Q&A with Senator Robson of the State of Wisconsin.
There has been USA citizen concern over the increasing trend of Offshore Outsourcing hurting the American job market and economy and now the political arena has decided to take action against this growing trend. Does offshore outsourcing hurt our economy and job market? I’m still on the fence. However the State of Wisconsin lead by Senator Robson of Wisconsin believes it does and in this believe has created the American Jobs Act. I asked Senator Robson about this new bill and why the State of Wisconsin is trying to eliminate offshore outsourcing in that state.


Key Success Factors in Multi-sourced Environments.
In the debate over whether outsourcing works best from a single-source, mega-deal approach or a best-of-breed approach, multi-sourced environments (using two or more external providers and an internal IT group) have clearly become the preferred service-delivery model. Historically, the single-sourced approach has often not delivered the anticipated return on investment (ROI).



Putting an End to problems in Achieving Return on Your CRM Investment.
Bradley Graham
Customers are a company's greatest asset, and Customer Relationship Management (CRM) solutions have for several years been touted as effective means in acquiring and retaining customers. But CRM solutions have also been in a heavy line of fire during the past two years as analysts and vendors have battled in the media over whether CRM solutions actually result in the anticipated benefits. Some point to a large number of failed initiatives (as many as 50%); others point to an increasing rate of adoption (especially now that CRM solutions are cost-effective for the SMB market) and proven value achieved. With such mixed messages, companies now eye CRM investments with more scepticism.


It's about Time - Outsourcing and Business Decisions Cycles
F. Keaton Whitlow
Probably no executive is unfamiliar with the idea that speed or time can be used as a competitive weapon. Military commanders through that years used time-based strategies to seize the initiative and win battles. Military thinking can be, and often is, applied to competitive strategies in business; and time-based stratagems, in particular, are proven competitive-advantage weapons that greatly improve the odds of “winning” over competitions.

Change Management in Outsourcing
Dalip Raheja
One of the most overlooked aspects of implementing outsourcing projects is the activity of change management. Change management is an organized, systematic application of the knowledge, tools and resources of change that provides organization with a key process to achieve their business results. Too often, the process and technology moves much faster than the people who need to implement the new business paradigm. We at The Mpower Group have noted many studies that cite poor change management as the number one issue in outsourcing failures. When change management is done correctly, it is cited as the number one contributing factor for the success.


Costco Shops for Right Outsourcing Contract Linda Tucci When Don Burdick took over as senior vice president of information systems for Costco Wholesale Corp. in 2000, his department had 60 programmer spots to fill. Employees were struggling to keep up with routine work. Morale was low. "Every day you came in and were fixing stuff that was broken," said Burdick, estimating that less than 30 percent of the work focused on projects designed to add value to the company. That put IT badly out of sync with a company that has become the nation's largest wholesale club operator with 452 stores. Over the past five years alone, Costco has grown from $35 billion to $52 billion in sales.


Outsourcing the Backup Data Centre
Matt Stansberry
Business continuity outsourcing is big business, as recently evidenced by the private buyout of business continuity provider SunGard. While more midrange companies manage mission critical IT infrastructure, they don't have the capital to invest in redundant systems. Therefore, many companies are looking at outsourcing the backup data centre. The practice of keeping mirrored IT infrastructure off site can mean different things to different organizations. What the service entails often depends on the level of involvement the customer wants to have with the backup facility. But is it really outsourcing? It depends on who is doing the management and the monitoring.


Should You Outsource for New technologies?
With nearly all business processes these days having IT-enabled components, executives face the dilemma of deciding which competing internal projects and competitive-advantage initiatives are the best IT investments. Among other factors, they must take into consideration:

· business value vs. cost
· business value vs. risk
· buy (outsource) vs. build in house

All three parameters come into play with new and evolving technologies.


Learning from A Thought Leader
Paul Grim
Brian Keane a graduate of Harvard College and Harvard Business School started with Keane at the bottom as a sales representative liked the industry and thought it was a great opportunity. He worked his way through the ranks to become CEO in November of 1999. Before becoming CEO Brian worked in Japan for a few years in international trade.


Eliminating the Greatest Threat to Success in Outsourcing
Kathleen Goolsby
For a host of reasons, many people mistakenly believe an outsourcing service provider's poor performance is the primary cause for a failed relationship. Root cause analyses, however, most often identify poor communication as the biggest culprit. Through decades of case studies, clients and service providers are awakening to the problem. Essentially, effective communication in outsourcing is like chlorophyll, the substance that transforms carbon dioxide from the air into food flowing through a plant's vessels. With effective communication, a relationship can grow and thrive; without it, an outsourcing relationship will become diseased and may die. If effective communication exists, the parties can discuss and resolve performance problems and other challenges.

Survey Finds Outsourcing Hurts Supply Chain Visibility
The prevalence of outsourcing in electronics has resulted in companies losing control and visibility across their extended supply chain, creating increased risks, according to a new survey.
By Dylan McGrath
San Francisco - The prevalence of outsourcing in electronics has resulted in companies losing control and visibility across their extended supply chain, creating increased risks, according to the reults of a survey by INdustry Directions Inc. and the Electronics Supply Chain Association (ESCA).
The survey results, released Wednesday (Nov. 16), indicate that both "outsourcers" - original equipment manufacturers (OEMs) and the fabless semiconductor companies - and service providers have suffered a serious loss of visibility over their supply chain activities.


Can Big Blue Succeed in BPO
By Knowledge@Wharton, Written for Outsourcing Magazine This isn't your father's IBM. After decades of specializing as a computer manufacturer and provider of computer-related services, Big Blue in the past year or two has been heading into some not-terribly-technical fields. Today's IBM processes thousands of insurance claims, ensures that Procter & Gamble employees get paid, and takes charge of repairing televisions and CD players sold by Philips Consumer Electronics.


Outsourcing’s Well Kept Secret
David M. Klein and Kenneth U. Surjadinata
In January 2001, Merrill Lynch Credit Corporation and Cendant Mortgage Corporation entered into an outsourcing alliance to provide an enhanced array of home-financing services to Merrill Lynch clients nationwide. In connection with this transaction, approximately 600 Merrill Lynch employees dedicated to mortgage origination and servicing functions were hired by Cendant. Under the alliance, Merrill Lynch utilizes Cendant's services on a private-label basis to originate, process, and service mortgage loans while Merrill Lynch continues to market mortgages and other credit products through its network of financial advisors in branches nationwide.

Benchmarking In HR Outsourcing

Lowell Williams Almost every master services agreement for human resource outsourcing specifies that the client has the right to audit the provider's services and to call for a benchmarking study against which pricing and services levels can be compared. These provisions have been imported from IT outsourcing agreements where benchmark and comparison studies have long been available.

Heroic HR

Marc S. Miller
Much has been written about HR's mandate to become a "Strategic Partner" within its own organization. Proponents of change from venerable Peter Drucker and well-known Professor David Ulrich, and many other thought leaders of "guru" status have championed this needed transformation for the function of Human Resources. In today's uncertain economic climate it is more critical and evident that HR has to evolve into a "player" status, possessing clout, visibility and yes, even power, in the eyes of an organizations senior leadership.

Economics of offshoring
For those fearing that the offshoring wave would leave the home shores high and dry, take heart. Authors of The Black Book of Outsourcing believe offshoring would be a self-limiting phenomenon that would actually even give the US workers an edge.
Douglas Brown and Scott Wilson pointed out that increasing costs in developing countries, along with management issues would eventually lead to a tapering of the job influx. It is a play on the basic demand and supply principle. The jobs simply follow the trend of heading the wat of high demand: underutilized, qualified works. Once equilibrium is reached between the workers in foreign countries and the jobs avaliable, these jobs would head back onshore...

Offshoring rollback?
Unmet expectations have urged major companies to rethink their strategy on outsourcing functions, mostly in the field of IT. A Deloitte Consulting survey served as basis for this report by the Financial Times.
A huge three quarters of the survey respondents encountered problems with their outsourced projects while a quarter have reported to bringing back their operations in-house...

IT offshoring boosts economy
Despite the controversies surrounding the exodus of jobs it has created, offshore outsourcing of software and information technology services has not only given the US gross domestic product a considerable boost - it has actually helped generate US jobs even within the very volatile IT sector...

Human Resource Outsourcing Moves Forward

David White
Throughout the world, new terms are describing business models that provide more efficient and effective client solutions. The concept called outsourcing is nothing new. However, sophistication brought about through the internet and globalization has now made outsourcing highly attractive to entrepreneurs, investors and clients.

Using The SMB Approach

Paul Grim
The Reader’s Digest Association, Inc. (RDA) has a long history of helping everyday people and has grown to become one of the world's paramount publishers with its flagship publication Reader’s Digest magazine appearing now in 48 editions in 19 different languages and sold in more than 60 countries. DeWitt and Lila Wallace, the founders of Reader’s Digest, published their first issue in 1922 out of their Greenwich Village apartment. If you can believe this, they sold the magazine for 25¢ per issue exclusively by regular mail. Reader’s Digest Association has grown to millions of readers through other special-interest magazines, books, music, videos, and a diverse set of other global businesses such as school fund raising and display marketing.

Remaining Competitive
Lance Kirk Blue Cross & Blue Shield of Rhode Island (BCBSRI) is the largest health insurance company in the state of Rhode Island and has a dominant position in that geographic market. One of its key priorities is to ensure that they remain independent and financially strong so Rhode Islanders continue to have a local healthcare insurer they can count on to provide affordable, quality health coverage.


Outsourcing requires careful planning
Many outsourcing projects fall apart because companies fail to consider the costs and complexity
By Sumner Lemon
Companies looking to outsource some IT functions should plan carefully ahead of time, consideringa broad range of issues, to help insure these projects will be successful, according to industry analysts.
Demand for outsourced IT services is rising quickly as more and more companies look for ways to cut their IT costs and improve productivity. By 2007, global spending on outsourcing will top $50 billion per year, according to market analyst Gartner. But not all of these outsourcing projects will succed. Many outsourcing projects fall apart because companies fail to.....


Outsourcing's image problem
Most respondents said outsourcing is good for the world economy and bad for the United States
A recent Opinion Rsearch poll leaves no question that outsourcing -- particularly offshoring -- suffers from an image problem. Among 1,000 Americans surveyed, 72 percent of respondents said outsourcing is "really all about corporate greed," and 25 percent associated the world outsourcing with job losses....


Outsourcing In Mid-Market Companies
Ram Iyer
Globalization is here to stay, increasing the complexity and competitiveness of business. Large corporations with deep pockets and international presence have become competitive by perfecting the multinational model. They leverage specialized skills, suppliers, and less expensive labour pools to balance quality and cost levels for their business.


Outsourcing, As Sweet As Candy
David Hogan
Farley’s & Sathers Candy Company, known for confections like Super Bubble, Jelly Bean, Fruit Stripe, and more, has a long history behind them. In 1870, Gunther Farley and two of his brothers founded Gunther Chocolate Company. In 1891, they merged with another company, also owned by a member of the Farley family, to create Farley Candy Company. They continued on as Farley Candy Company through two sales in 1968 and 1974.

Software Project Outsourcing
Outsourced software development can offer important business benefits over in house development in many situations. Equally, outsourced development can introduce issues for the project and the long term success of the resulting solution. In this article we discuss the potential issues and benefits, and suggest ways to maximise the benefits and avoid potential problems.


Managed Services for Operators - Options and Approaches on Outsourcing
Today's mobile telecommunications market continues to present good business opportunities, but it's a tough, competitive environment. New mobile services and content promise additional revenues and differentiation, but require investment in new technologies and the ability to manage them effectively in the face of increasing network complexity. Meanwhile, price competition is fiercer than ever and Average Revenue Per User (ARPU) continues to fall relentlessly, causing an immense need to drive down operational costs. The decision to hand over specific activities to an outside supplier is always important and requires thorough analysis. Operators should pay particular attention to finding the best scope for outsourcing, defining the related business objectives, managing the outsourcing process and selecting the right managed services provider.





High Paying Jobs From Offshore Outsourcing - An Oxymoron?
Managing offshore IT projects themselves have become more complex. Companies with IT operations overseas find themselves dealing with a multitude of cultural, language, and legal issues. Managing these issues is starting to evolve as a profession in its own right. If one keeps on reading, one might find that the IT professional could play an important role in this new outsourced world. If the trusted pipe was implemented at firms doing offshore outsourcing, IT professionals may be able to create a role for themselves using this methodology.

In store. Right now. Retail Solutions from IBM.
IBM provides a full range of solutions for the retail industry, helping transform business into On Demand Business with point-of-sale systems, IT strategy and planning, supply chain optimization, outsourcing and managed operations, and much more. This is possible with solutions such as IBM Store Integration Framework, IBM Personal Shopping Assistant, IBM Dynamic Digital Merchandising, IBM Guided Selling for Complex Products, the IBM Retail Business Intelligence Solution, and more.


Industry Trends in Outsourced Testing Services
Currently IT organizations have to deliver enhanced quality applications with less time with fewer resources. Often, the first downsize in the IT budget is felt on testing systems, thus making it difficult for many IT organization to execute a complete application testing function internally. An outsourcing provider delivers centralized and qualified testing methodologies, skilled stuff as well as certified standards.




Coaching Your Team for Better Code Quality Management
There are many reasons for software failure: poor project management, the growing complexity of software and market changes. But most often, poor code quality is to blame and whoever developed the software—whether a commercial software vendor, an outside technical vendor or a company’s IT organization—is liable.


CEOs Who Fail to Actively Manage Outsourcing Relationships Miss Out on 'Trust Dividend' Worth Up to 40 Per Cent of Contract Value LONDON, November 24 /PRNewswire/ -- Well managed outsourcing arrangements based on mutual trust can create a 20 per cent to 40 per cent difference on service, quality, cost and other performance indicators over outdated power-based relationships. This is the finding of new research(1) published today by LogicaCMG and Warwick Business School. The study shows that CEOs who neglect to actively manage their relationships with outsourcing partners are missing out on a `trust dividend' worth up to 40 per cent of the total contract value. The study suggests that companies should agree a relationship charter with their outsourcing partner that sets a benchmark for behaviour, and that regular health checks, balanced scorecards and senior executive dashboards for the customer are introduced as mechanisms for monitoring success.

The changing dynamics of outsourcing

The outsourcing marketplace is going to lean more towards BPOs and more players will join the fray; however, the total value of deals is likely to reduce. This was concluded by an IDC study of the 100 best outsourcing deals in 2004. According to the study, the total value of these 100 deals went down from $69.1 billion in 2003 to $68.3 billion in 2004.


ITIL, IT Governance & the Managed Service Provider (MSP)
Organizations are adopting ITIL to provide a framework for best practices, and, many of these organizations are seeking out external partners who use complementary, compatible processes. These organizations want to share the same consistent, common language as they contract out and transition a specific area of their IT organization. Consequently, Managed Service Providers (MSPs) are facing mounting pressure from potential customers to demonstrate how their services align with ITIL best practices. This document aims to illustrate and describe the reasons for an MSP to adopt ITIL, as well as some of the pitfalls that an MSP might encounter in the current IT environment.

Managed Security Services for Small Businesses: Protecting Your Business Cost-Effectively Through Outsourcing
Small and medium-sized businesses aren't immune to security threats. If you use e-mail for communications, have mobile employees or remote offices, or maintain a Web presence, you are at risk. How can you mitigate your risk without taking resources away from core business activities? This white paper outlines the advantages that small businesses can gain by outsourcing security management services and provides advice on what to look for when choosing a managed security service provider.

Why Enterprises Outsource Network Security
Written by Stratecast Partners, this study will give you a comprehensive business cost and benefit analysis on outsourcing network security. Learn how the Managed Security Service Provider (MSSP) business model could result in increased economic benefits and security effectiveness for enterprises over an in-house approach. Download this White Paper now!

Outsourcing not all it’s cracked up to be
Just when the zealots would have us believe that outsourcing was on the verge of steamrolling IT departments and leaving far fewer employees in its wake, Deloitte and Touché issued the results of a study that indicates myriad twists in just such a plot.
Deloitte’s report, Calling a Change in the Outsourcing Market, Found:

-70% of participants have had negative experiences with outsourcing.
-One in four respondents realized that they could handle certain functions better in-house, and yanked those back inside the corporate walls.
-44% did not see cost-savings from outsourcing…

A Broader View of Off shoring

Author John Hagel says many Western execs see only cost savings when they can learn so much more from Chinese and Indian companies


Off shoring has been a hot topic in recent months, as Western companies have cut tech labour costs drastically by shipping such jobs to countries like China and India. But the trend means more than just job loss at home or short-term wage arbitrage for the West. In their book The Only Sustainable Edge ($25, Harvard Business School Press), John Hagel III and John Seely Brown argue that the rise of the tech industry in China and India will lead to the creation of formidable overseas competitors. The advantage has less to do with sheer population figures, they say, and more with the differences in how these new powers do business.

An Onshore Play In Off shoring
Shares in Indian tech consultants may be pricey -- but there's room to grow

As more American and European companies ship specialized service and high-tech work to developing nations such as India, business looks bright for the outfits that supply the labor. Yet stocks of many major offshore consultants have been struggling. For instance, the American depositary receipts of Infosys Technologies (INFY ), India's second-largest outsourcing specialist, are down 13% so far this year. Returns for Cognizant Technology Solutions and Wipro (WIT ), two other brand-name offshoring companies, are down 4% and 27% respectively. Intensifying competition, concerns over rising labor costs, and worries about growth prospects have put pressure on stock prices.




The Soft Underbelly Of Off shoring
A high-tech scam on Citibank accounts is a nightmare for India's call centres

On the steamy morning of Apr. 4 two smartly dressed men walked into a branch of Rupee Co-operative Bank Ltd. in Pune, 150 km from Bombay. The two were among the city's software and back-office workers -- a growing, prosperous group coveted by banks and merchants.

Asia: Spam Factory of the World The region’s efforts against a surging, ever more harmful tide of unwanted e-mail are falling short. Now, add cell-phone viruses to the mix.
In the fight againts spam, Asia seems to be losing. Over the past few years, servers based in China and South Korea have become major sources of unwanted e-mail as spammers take advantage of loose regulation, low costs, and lax security (see BW Online, 9/13/04, Now spam is being outsourced)



Insource, Offshore, Outsource –Help!
The number of new work-allocation terms floating around could confuse any small-business owner. Here’s what they really mean.
Insourcing, off shoring, outsourcing, near-shoring: The confusing terms crop up frequently but aren’t always well-defined. What do they mean in practical terms? Should small-business owners sign on to these oftpromoted business models? Do they really deliver on promised cost-savings? Smart Answers columnist Karen E. Klein recently posed these questions to Phil Bloodworth, a partner in PricewaterhouseCoopers’ advisory performance-improvement practice. Edited excerpts of their conversation follow:


The Slippery Slope of Outsourcing R&D
Your recent "Outsourcing innovation" (Special Report, Mar. 21) addressed an important transformation that is often underestimated: the off shoring of knowledge work. It is hoped that this story will help to put the sources of innovation back on the agenda of corporate strategists. While retaining the work of highly educated workers can be expensive, letting it go can weaken the competitiveness of companies.

An Offshore Connection for Small Biz
Call centres are beginning to pitch their services beyond the big leagues. But be aware of hidden costs and PR risks

Offshore call centres have emerged as an option even for small companies, with the potential for major cost savings. Problem is, they can also be a turnoff for customers. Controversy over sending American jobs overseas erupted during last year's Presidential campaign, leaving nearly all the companies that hire overseas call centres so touchy about the practice that most refuse to discuss it publicly.





Outsourcing Innovation
First came manufacturing. Now companies are farming out R&D to cut costs and get new products to market faster. Are they going too far?
As the Mediterranean such bathed the festive cafes and shops of the Cote d’Azur town of Cannes, banners with the logos of Motorola (MOT), Royal Philips Electronis (PHG), PalmOne (PLMO), and Samsung fluttered from the masts of plush yachts moored in the harbor.





2004Outsourcing: Something lost, something gained Outsourcing security can ease IT burdens, just be sure to read the fine print By Roger A.Grimes
Configuring and maintaining firewalls, IDSes, and anti-spam filters can challenge even the best security administrators. How can anyone realistically review every message in every event log? A tightly managed security framework frequently requires more time than available resources allow.
That’s why hiring MSS (managed security services) providers is a popular alternative to internally managing off-the-shelf solutions or customized programs. MSS providers promise the expertise and staff resources to maximize security. Take for example e-mail content filtering. Service providers Message Labs and Postini are leaders in providing anti-spam, anti-virus, and anti-pornography filtering for SMTP e-mail. Both companies scan billions of e-mails each week for thousands of customers, and their accuracy is extremely high. They can also save on maintenance costs, customers say.


Offshore outsourcing poses privacy perils Contractual ties with overseas vendors advised for data usage By Kaikumar Vijayan, Computerworld
Washington – outsourcing job to offshore destinations can sharply increase data privacy risks and the complexity of managing that risk, several experts at the Fourth Annual Privacy and Data Security Summit here warned this week.
As a result, companies need to ensure that overseas vendors are contractually tied to specific conditions regarding how data is transmitted, accessed, used, stored and shared, they said. Those challenges include regulatory compliance, data protection and access issues, as well as monitoring and auditing issues.
The secrets of outsourcing success From IM to on-site staff, communication is critical – and flexibility doesn’t hurt By Ephraim Schwartz
Outsourcing is a volatile subject after all; it puts jobs and even careers at stake. But we need to remain calm and take a sober look at the business strategy of outsourcing IT. Besides, I promised part three of my look at outsourcing last week.
To that end I spoke with Arkadiy Dobkin, CEO of Epam Systems, an outsource provider in Minsk, Belarus; Abnash Singh, executive vice president of Amoksha Technologies, an outsourcer based in Bangalore, India, and Micheal Akselrod, senior vice president for research at Reuters, an Epam customer in New York.Akselrod stresses that his opinions are his own and do not represent those of Reuters…


















2003Tapping the outsource Outsourcing has immediate bottom line benefits, but management issues warrant a close look By Ephraim Schwartz
Outsourcing appears to be the topic of the day, and from what I can tell, that conversation will only grow more intense this year.
Outsourced software development is focused on new product development, custom development for the enterprise, and support and maintenance, especially for mainframe and other legacy systems. There are two issues that those working in IT appear to be most concerned about. First and foremost, what are the long-term repercussions on IT of using outsourced resources? And, what are the issues facing a North American IT shop that deals with a service supplier thousands of miles and many time zones away?

Gartner: Most companies unfit to manage outsourcers

Without proper supervision, outsourcing often yields low return on service value

By Juan Carlos Perez, IDG News Service
Most companies are unprepared to properly manage the outsourcing vendors they hire and to closely monitor their work, Gartner Inc. has found.
Gartner forecasts that by 2005, 70 percent of companies will use more than three IT service providers for projects in key areas, but that less than 10 percent of companies will be prepared to effectively manage the outsourcers' work.
Without proper oversight and supervision, companies can't ensure that the goals and expectations of the outsourcing engagements are being met. This in turn often yields a low return on service value, particularly when the client has hired several outsourcers that need to collaborate and interact, according to Gartner's new report "Successful IT Outsourcing: Strategies, Tactics and Management Approaches for Effective Strategic Sourcing."