| InfoWorld: It's been in the planning stages for months, but Nasscom is finally ready to push out its online national registry of employees of business process outsourcing (BPO) companies. According to previous reports, this registry will be followed quickly by an online national registry for IT workers in India as well. The proposed registry, which is intended to help conduct background checks on Indian outsourcing staff, could help reduce the risk of criminal activity, according to experts. Once the registry is in place and bug-free, which could take about four months, BPO companies can use it to make sure they aren't hiring someone who has participated in illegal activities in the past. Employees will be able to opt not to enter the registry or not to allow their records to be shared. Those actions, of course, could affect their ability to land a job. | Sponsor: Info~Tech Research Group | | Build Your Disaster Recovery Plan Before Disaster Strikes
Now you can apply industry recognized best practices without spending thousands on consultants. Building a Comprehensive Disaster Recovery Plan, the interactive Best Practices Guide from Info~Tech Research Group, walks you through every step. Plus: 66 essential tools and templates. > Click here to learn more. | silicon.com: Outsourcing adviser TPI is finding that large companies offshoring to low-cost locations such as China and India are increasingly setting up their own operations, known as "captives," rather than using external service providers. As the offshoring market has matured, many IT buyers have become more aware of how to conduct offshore operations themselves. Some buyers are using a hybrid model that mixes do-it-yourself captive work with more traditional outsourcing. But according to one expert, the build-operate-transfer model is also gaining steam, particularly in IT outsourcing, with companies using third parties to set up a development team, manage it and finally transfer it — essentially creating a new offshore IT department. MENAFN.com: This article examines one of the biggest challenges at the beginning of an outsourcing deal: managing the transition and moving an entire group of employees from one company to the next. Workers in the middle of a transition are faced with a number of uncertainties, ranging from anxiety over whether they will keep the same telephone extension to adjusting to a changed career path. This article highlights a couple of real-life stories from IT pros who took on new positions for an outsourcing partner, while still working among (or overseeing) peers who remained with the original company. Going from corporate loyalist to contractor requires a new mindset for IT pros — a leap that some people can't make. So they leave; about 15 percent typically do so in the first year. | | Special Offer: Free White Paper Understanding the Total Cost of Ownership of IP Telephony Solutions
In this study conducted by an independent research and consulting group, the often-hidden costs associated with IP telephony ownership are revealed. Discover this analysis methodology for determining TCO based on six cost categories. It's highly flexible and can be used to generate similar benchmarking for many different sizes and types of deployment comparisons. Check it out today! | | | | ZDNet: This commentary is of interest because it takes to task much of the anti-outsourcing data that is making the rounds. The columnist specifically points to the oft-quoted Deloitte Consulting study that suggested that outsourcing often disappointed. But a sharper look at the conclusions, in which 70 percent of outsourcing respondents had "significant negative experiences," shows that the study isn't really about failure at all, according to this columnist. And with only one in four of those respondents bringing their services back in-house, outsourcing seems to still have a strong hold. This column also takes a testy stance on the BA outsourcing debacle, saying that British Airline's catering problem isn't "really about outsourcing. It is an object lesson in not bankrupting your suppliers, whoever they are." While outsourcing has gone through some growing pains, with early failures and stupid choices behind them, companies should be able to take advantage in a more mature and success-driven outsourcing market. Kansas City Infozine: This article examines how offshoring can affect the economic, social and environmental value of different areas in the offshoring market. Public backlash and layoffs are not the only reasons that companies are choosing not to take their operations abroad. Offshoring of all types, including IT, can also strip down the local tax base and damage a company's brand. Other negatives include the possibility that rapid growth in offshore destinations can strain local infrastructure and create damaging cultural stresses. In the home country, it is not only employees who are hurt through layoffs; suppliers lose business, communities lose tax revenues, and the local economy loses the multiplier effects of direct spending. These are all serious matters that need to become part of any offshoring equation. | IT Marketplace | | | | | Tell the IT Business Edge audience of technology decision makers about your product, service, event, or job. Click here to list it in the IT Marketplace! | | 3 QUESTIONS:
24/7 Offshore Models Magnify Management Issues
With Frank Mazzucco, a senior consultant with U.S.-based Compass. Question: In theory, how is the 24/7 outsourcing software-development model supposed to work?
Mazzucco: The theory behind the 24/7 model is that an organization would establish multiple development centers in different time zones — for example, one in the UK, one in the U.S., and one in India. Each development center works on the same set of code and "passes" the work to the next center at the end of its shift. In theory, this approach allows for three sets of developers to work on the code in essentially a round-the-clock mode, and should allow for very rapid development cycle times. Question: In real life, how and why has it fallen short of those expectations?
Mazzucco: The time differences and geographic separation between the teams make it very difficult for this type of approach to work. With developers in three time zones working on the same code base, communication and coordination issues are greatly magnified, and decision-making is difficult. For example, a decision that involves input from all three development centers could not be made in real-time and would likely take multiple days. This effect is heightened on highly interactive development work where the requirements are not really known up-front.
A corollary of this is that companies should NOT use offshore personnel as resource supplements for on-shore projects, as the same communication and coordination issues will arise. Question: What can companies do to make the 24/7 development model work for them in an offshore partnership?
Mazzucco: If you absolutely must do 24/7 development, there are a few steps you can take to ease the pain. For example, daily communication and handoff meetings between the three geographical team leads are a must. But since there is no good time for all three team leads to meet (somebody would be sleeping!), this would typically be done at the time of handoff, between the two affected team leads.
It's also possible, particularly with Indian outsourcers, to have their offshore developers work the same shift as your U.S. developers. This can make communication a bit easier, but it does defeat the point of "round the clock" development.
The easiest — and best — approach is to start with clearly defined requirements, and use these to specify separate work packages for each of the development centers. Each center can then work on its own work independently up through system integration and testing. This adheres to the original, sound principles of offshoring, which is that you ship fully defined requirements offshore and you get back tested code that is ready to integrate. | | Also from IT Business Edge: Leveraging Open Source Leveraging Open Source gives you a comprehensive view of open source adoption in the enterprise. From Linux's growing role in the mid-tier server market to open source corporate blogging software, the open source movement is making inroads in the enterprise. Click here to sign up! | By the Numbers
$349.2 million Amount the Malaysian IT outsourcing market is expected to bring in 2008, after growing at a compound annual growth rate of 27.2 percent over the next five years, according to IDC. 95,225 The total headcount of the top 20 captive operations in 2004-2005, up from 54,666 in 2003-04, showing an increase of almost 75 percent, according to TPI's calculations. 15 percent Employees who quit after one year of being transitioned over to the payrolls of their original company's outsourcing partner. Breaking Headlines
TechWeb: There has been much talk lately about companies using outsourcing for increased expertise instead of cost savings. While that may be a growing trend, that business plan doesn't represent the main reason for outsourcing, according to a new study by Evans Data. This research shows that 28 percent of companies said cost savings was the main reason to outsource, up from 15 percent five years ago. On the other hand, 19 percent of the respondents said they outsourced to take advantage of special expertise, down considerably from 44 percent in 2000. Computerworld: Results from a Computerworld online poll show that companies believe complying with the mandates of the Sarbanes-Oxley Act to be the least effective or most wasteful use of their IT resources in coming years, followed by the deployment of unproven technologies. Of the 444 poll respondents, 28 percent cited Sarbanes-Oxley compliance as a time waster. The previously reported reality that many companies are turning to outsourcing in order to comply with Sarbanes-Oxley in a more cost-efficient manner makes these poll results even more compelling when considering outsourcing IT's compliance efforts. InformationWeek: Persistent Systems has announced massive hiring plans in an effort to meet the growing demand for offshoring software product development, according to this article. Persistent is already one of India's largest companies that focuses exclusively on outsourced software product development services and support. Persistent will recruit an additional 800 engineers by year's end to add to its current staff of 2,000, and will complete a facility for another 2,500 staff members by March 2006. Emerging Trends
San Francisco Business Times: According to the Santa Clara University Business Index, produced monthly by the private college's Leavey School of Business, job growth was essentially flat for the last 12 months in Silicon Valley, and area industries don't anticipate a strong upturn in hiring in the next six months. This situation is due, in part, to the fact that at least half of valley firms surveyed have outsourced at least "some" of their information technology and support services. Blackenterprise.com: This article examines the rise of Malaysia in the IT offshoring marketplace. Malaysia is ranked highly among the locations competing for offshore jobs, thanks to its low infrastructure costs, attractive business environment and high levels of global integration. Many experts believe efforts by the Malaysian government to promote the information and communications technology services sectors could make the country one of the strongest competitors to India's business process outsourcing dominance in coming years. IT Business Edge: Outsourcing for Strategic Advantage
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