Outsourcing Times

Virtuos Outsourcing Firm gets New Financing

Game industry outsourcing firm Virtuos announced that it has clinched a new financing deal with Legend Capital. Legend Capital is an independent VC firm under Legend Holdings, owner of Lenovo group. Virtuos exclusively focuses on providing outsourced services to international clients. It has confirmed that it is positioning to address the growing global outsourcing opportunity within the game industry. The game industry in the United States is all set to reach $1.1 billion by the end of 2006 and will grow to $2.5 billion by 2010. Virtuos also indicated that it intends to expand the size of its teams as well as continue its efforts to deliver the quality.

According to Gamsutra -

While Virtuos has been profitable since inception, we are excited to collaborate with a group as strong as Legend,” said Gilles Langourieux, CEO, Virtuos. “We plan to use the new funding to triple the size of our teams in the next 2 years. Virtuos will also invest further in training, processes, security and IT to create a level of service never seen before in our industry.

IT Outsourcing

In today's highly competitive IT job market, there is no guarantee that an individual having knowledge and experience would get a good job. The IT job environment of the 1990s is no longer there and it is unlikely to return again. There was a time, when there was a shortage of technical workers to fill the available jobs. Now the number of aspirants has gone up as compared to the available jobs. The current environment does not promise a handful of job opportunities if there is a loss of job. IT outsourcing has gained momentum in the market, as it saves both money and time. At the same times, the pressure on third parties brings positive result and improves the quality and productivity.

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.

According to OneStop Click -

In addition, the study highlighted positive growth rates in BPO (Business Process Outsourcing) across Western Europe, especially within the UK.

Convergys to Expand Operations in Asia-Pacific

Convergys Corporation has decided to expand its HR BPO operations in the Asia Pacific region. It has increased its global HR BPO capacity by opening new or expanding existing service centers in Malaysia, India, China and Singapore. The service centers will provide HR BPO services access to more than 150 global and regional clients. Asia Pacific region has emerged as a hot spot for BPO operations. Like most companies, Convergys is planning to explore more opportunities available in that region. As part of its strategic expansion efforts, Convergys will operate in high-tech locations with a highly skilled talent pool to grow its client base and meet the requirements of its clients.

According to SunStar -

Convergys' Asia Pacific service centers provide a broad scope of services such as benefits and leave administration, learning and performance management, recruiting and staffing administration, and payroll administration for clients from multiple industries.

Virtuos expands gaming plan with new funds

We have all heard of outsourcing firms paying phenomenal salaries to its employees to acquire the best skills available in the industry. Apart from the salary, outsourcing vendors also need to invest heavily in developing infrastructure capabilities to present a happy picture for potential outsourcers. Together, this calls for a strong financial backup, without which vendors cannot hope to survive and expand production in the competitive market of today. Thus, with the conclusion of a new financial deal with Legend Holdings, it is a happy situation for game industry outsourcing firm Virtuos.

Barely eighteen months into production, Virtuos can now give an impetus to its next-gen game development plans. There is a big outsourcing opportunity in the gaming sector globally, and Virtuos aims to figure prominently in that market by increasing its team three-fold over the next two years and investing heavily into training, processes, security, and IT. Where will the money come from? You guessed it, its from new financial partner Legend Holdings. Gamasutra cites market research firm Screen Digest:

[The outsourcing opportunity within the game industry] will reach $1.1 billion by the end of 2006 and is set to grow to $2.5 billion by 2010, representing around 40 percent of total game development spend.

Where is HR Outsourcing headed?

HR is probably one of the most lucrative market areas for outsourcing, outside of IT and telecomm. In recognition of this trend, The Conference Board published a report on HR Outsourcing Trends in 2002. The Board has now followed up with a fresh report on the benefits, challenges, and trends that mark HR outsourcing.

You need to see the two reports in conjunction as two parts of a study that investigates practices and outcome of HR outsourcing. The 2006 report is the result of a survey of 122 major companies in North America and Europe. According to an article published by IT 
Analysis:

In addition to an analysis of how human resource outsourcing practices may have changed in the interval since the previous study, this report evaluates the benefits and drawbacks of outsourcing, explores the considerations that lead to the decision to outsource, and examines the early experiences of a growing number of companies that are choosing to outsource the bulk of their HR activities.

Scam in Bangalore Call Center

Followed by embarrassment caused to BPO industry of India due to Gurgaon and Pune data theft case, the HSBC electronic data processing India Limited in  Bangalore has given another jolt to BPO industries of India.

Twenty-four Nadeem Kashmiri, a customer service executive appears to be the kingpin. He is believed to have links with some unidentified lead in the UK, which has siphoned 2,33,000 pounds from HSBC accounts. The matter came up for investigation after some UK customers complained that over 350000 has been transferred from their accounts.

Rather than blaming the Indian  BPO industry itself, attempts should be made to guard against the misuse of ATM/Debit card facilities and prevent such stray incidents of pilferage.

India Daily has more on the BPO scam in Bangalore.

BT and KDDI Partnership on Network Outsourcing

BT Group, Britain's largest phone company and KDDI have announced that they would form a venture to seek voice and data network contracts from Japanese corporate customers. Sales from the joint venture could rise to $1 billion. According to BT sources, revenue will probably reach that level in three to five years. The joint venture will start in August 2006. The alliance will help KDDI in raising its earnings from fixed-line telephone business. BT is part of outsourcing markets in Japan worth about $90 million. This is twice the combined size of the rest of the markets in the Asia-Pacific region.

According to International Herald Tribune -

In Japan, KDDI and Nippon Telegraph & Telephone are looking for ways to generate gains from wire-based services as competition brings down prices and more subscribers switch to wireless phones. In November 2004, BT and KDDI teamed up to offer global networking services to companies.

Medical Outsourcing Wave in India

Analysts believe that another larger outsourcing wave is all set to sweep the Indian BPO industry. A number of hospitals in the US and the UK are outsourcing laboratory and diagnostic tests to India at a lower cost. It costs about 70 to 80 percent less by outsourcing their businesses. Indian labs offer the facility where over 1,500 tests can be conducted under one roof. At the moment, this is generally limited to highly specialized tests. Experts say that outsourcing of laboratory testing and diagnostic services all set to become big business in India.

According to Express India -

According to industry estimates, the Indian diagnostics and pathology laboratory business is around $864 million and is growing at a rate of 20 per cent annually. Some Indian lab companies have secured contracts with a few hospitals from the Middle East.