Outsourcing Times

Now, Pharm Offshore

Executives across industries are now exploring ways of tapping their offshore workforce to generate additional revenue, improve core business processes, and offer more value to customers. While pharmaceutical companies came late to offshoring, they are making up for this delay by moving quickly to capture gains beyond labor cost savings in back-office operations. Mckinseyquarterly.com reports:

Most of the industry, however, has been more cautious. Some pharma companies are outsourcing selected functions (such as certain IT activities) only for cost savings rather than looking more broadly at the development of new processes that would improve business productivity or generate revenues.

Read more: Pharma leaps offshore

AT & T terminates customer service contracts for DSL installations

Here is a piece of breaking news from AT & T! Are you aware of the terminations of customer service contracts to other countries by AT & T? Read on to know the details.

AT & T has decided on terminating the customer service contracts for DSL installation that it had been outsourcing in the past. The company has come to a consensus with the CWA (Communication Workers of America Union) to use the personnel within the nation for the customer care service of DSL installations at home. In addition to this, the customer care executives would provide the technical details regarding email,internet and DSL related technical queries.

The employees who would be taken into will be into the rolls of AT & T by the wake of the year 2008

Click here to read more on "Threat of Outsourcing Causing Union Growth" in one of our previous posts.

IBM, EDS bag outsourced projects from Vodafone

IBM and EDS have bagged the subcontracted projects from Vodafone. The outsourced work involves back end application maturation and maintenance activities of IT network across the Globe Group.

Amidst a severe downfall of the Vodafone group in the European market very recently, the company has given emphasis to the cost curbing activities. As an initiative towards cost curbing by 30% within the next five years, Vodfone group has taken up this deal with EDS and IBM.

Read more on "Vendors watchout" to know the details on the IT and BPO projects that are outsourced by Vodafone group, UK.

Welsh Water to revamp IT systems in multi-outsourcing contract

CapGemini, LogicaCMG, and TCS will seek to transform the business processes and IT systems at UK utility Welsh Water in a £100 million outsourcing contract. The outsourcing partners will bring about comprehensive hardware replacements and implement the fully integrated SAP enterprise resource planning system.

The outsourcing move is expected to bring Welsh Water on par with state-of-the-art water technology, and the next three years will see the utility train 2,500 employees so that the new system is put to its optimum use. Vnunet quotes head of IT Fraser Nairn:

In the past, we have not invested a great deal in IT, and we want to update all our systems to give much better services to our customers and bring big efficiencies into the business.

IT heavyweights discuss the outsourcing flight path

As we have seen in an older post titled "Western European IT outsourcing bounds ahead through mega deals", it is least surprising that IT continues to be the one industry that is making rapid strides, attracting many offshore mega deals. India is very much a part of this world phenomenon. 

This was reflected at the IT conclave organized by the Industrial Interaction Committee of the MBA program at IIT Kanpur, where several of the top IT heavyweights traced the development of outsourcing in India from its days of infancy to its present mature state.

Mr. Ramakanth Desai, Senior Vice President, Business Strategy and Innovation at Wipro, reflected on the initial phase when cost arbitrage was the key attraction that Indian IT players had, and looked at the status today when big deals are being struck by service providers in India. The BPO industry obviously continues to play a major role in the paradigm shift, with a growth rate of about 50% per annum.

Other speakers focused on issues such as the global mindset of Indian managers for a vibrant outsourcing industry, project management as a key to the success of the IT industry, the utilization of IT as a strategic tool for increasing business competitiveness, and the rather sordid tale of corruption in the IT industry.

For more details on each of these subjects, click here.

Fiserv Inc. to provide core banking services to Denmark State Bank

In an older post, I mentioned the high dependence of investment banks on outsourcing. In fact, outsourcing in the banking sector has been on a steady growth path across the globe.

When the time came to have a relook at its outsourcing partner, Denmark State Bank in Wisconsin opted to go for Fiserv Inc., rather than renew the contract with its existing service provider.

It's really the requirement for change that has prompted Denmark State Bank to opt for Fiserv Inc in the place of its current service provider. The Bank officials assert that the Premier core capability of Fiserv is a better option that enables the bank to access all customer data from a single application without giving up functionality requirements.

The Fiserv clearing network will posit the bank pretty well to create substitute checks as and when required and extract more mileage from the deal. Finextra reports on Fiserv's Information Technology Inc. (ITI) business unit:

Available for both outsourced and in-house environments, ITI's openly integrated software suite offers products for virtually every function, including Internet banking, enterprise content management, executive intelligence, relationship management, branch automation and core accounting, all available on the industry's most popular hardware platforms.

Dell's Outsourcing Initiatives

Dell is planning to change its business strategy by outsourcing most of its services in order to expand its operation across the globe. Traditionally, Dell has been US-centric. However, now it wants to focus on other countries that have emerged as top IT and Software hubs. The company will reduce the number of services it currently provides in-house. Dell is expanding into growth markets by building new plants in countries like Brazil, China, India and Central Europe.

My previous post titled "Reducing Cost Adjustments in Outsourcing Contracts" gives useful information about cost adjustments in outsourcing.

Visanet and EDS: Outsourcing deal through decades

Over the next ten years, the Plano-based tech company EDS will continue to provide ITO and BPO services to Visanet, a credit card services provider based in Brazil. The new contract is worth $209 million, and is an extension over the existing agreement between the two parties.

What is interesting to note is that the two companies have been associated over the past ten years; this is certainly turning out to be a long-term association. Global Services reports:

In addition to existing services, EDS also will provide call center support to assist Visanet merchants with point-of-sale equipment-technical support. The call center handles more than 450,000 merchant calls per month.

Offshore IT Outsourcing

You must have heard about risk factors associated with outsourcing. Often companies overlook these risk factors and face problems with the processes in the end. Risk is natural in strategic business initiatives. It increases when it involves two organizations that are involved within different geographical and political boundaries.

Offshore IT outsourcing involves special emphasis on Information security and risks associated with loss of control over strategic business process. Frequent audits and analysis can help you in maintaining a continuous supervision over your vendor. To ensure better vendor management, you need to influence the communication methodology for offshore software development.

Get some tips on outsourcing by reading my previous post titled "Outsourcing Tips for Small Businesses".

Offshore Outsourcing Reduces U.K. Tech Workforce

It is said that somebody's is gain is other's loss. This is true in this case. You will be surprised to know that the success of offshore outsourcing is causing the number of UK-based technology staff to decline. The job reductions are witnessed in programming, low-level technical roles, call centers, helpdesks and back-office administration.

According to reports, there will be 130,000 offshore workers delivering software and IT services for UK organizations. The number of UK-based staff hired by offshore companies will continue to increase over the years. However, they may not be sufficient to offset the overall decline in the UK.

To know more about IT outsourcing, you can read my post titled "Choosing the Right Time for IT Outsourcing".