Archive for July, 2010
Posted on July 27, 2010 by Atul
From globalizationtoday.com.
IAOP’s Members Report a Very Important ‘Shoring’ Trend – There Is No Trend
As a global membership organization one of IAOP’ greatest resources is its ability to survey its members to capture the industry pulse – what’s hot, what’s not, and which way things are headed.
For example, as mentioned in my last column, it’s now clear from IAOP member surveys that the recent economic crisis has actually been good for outsourcing. In January 2009, 36 percent of our customer members said that their companies were actually expanding their future outsourcing programs as a result of the economic crisis. By September 2009 that number was at 47 percent. By January 2010 it was up to 56 percent. Then delegates attending the 2010 Outsourcing World Summit said that for them it was now 70 percent! A clear statement of where the industry is headed.
But when t comes to ‘shoring,’ these same customers tell us that it’s a much more fluid dynamic as opposed to a trend. In January 2009, 24 percent said that they were doing more offshoring as compared to only 9 percent who said they were doing less. By September 2009, 31 percent said they were more focused on offshoring while 33 percent said they were more focused on nearshore and onshore providers. By January 2010, the percent increasing their focus on offshoring was back down to 25 percent while the percent increasing their focus on onshore and nearshore providers was also down to 26 percent. More like a tide then a trend.
The simple fact is that everyone is getting more global. In September 2009, 47 percent of our provider members said that their firms were expanding geographically and 42 percent said the same thing in January 2010. In both surveys, about 30 percent of providers said they were establishing more local and rural centers from which to service their customers. So while it’s clear that the industry is getting more ‘global’ which ‘shore’ is shifting around a lot.
As both customers and providers become more global and distributed in their operational footprint and as the work becomes more fluid in terms of where it’s done, location distinctions are less significant in customer decision-making. Costs are becoming more blended as well in today’s virtual, cloud-like, delivery model, making a pure-play offshoring decision less of a driver for many companies than it was in the past.
Colombia: A Great Example
So, is the country of Colombia, where we just opened an IAOP Chapter, an offshore, nearshore, onshore, whatever-shore location? You bet, all the above.
Citi is supporting Spain from call centers in Bogota. Telperformance is supporting customers in Mexico. Bilateral has customers in the U.S. being supported in Spanish and English from centers in Barranquilla and Bogota. And there are many more examples, including the growing ‘onshoring’ of work for Colombian companies right there in Colombia.
So, the question is: Do we really want to keep talking ‘shore’ when we should be talking ‘solution’? Is all the talk about shore hiding what really matters – value?
Just a thought. But what do you think? Email me at michael.corbett@iaop.org with your thoughts about the affect of the recent financial crisis on outsourcing. Also, let me know about examples of thinking differently on any aspect of globalization and business that you’d like to see explored in a future column.
Michael F. Corbett is the founder, chairman, and chief strategy officer at IAOP. He believes it’s time think differently about the world we live and work in.
Posted on July 25, 2010 by Atul
Wipro Q1 net up 31% on outsourcing recovery-Earnings News-Earnings-News By Company-News-The Economic Times.
MUMBAI: Wipro delivered a thumping verdict for recovery in the outsourcing sector with a robust growth forecast and better-than-expected earnings for the first quarter to end-June as spending of clients on technology begins to swell.
The country’s third-biggest software services exporter said it expects revenues to rise between 4.1% and 6.1% in the next quarter on the back of increased spending by corporates that slashed budgets to the bone during the financial crisis.
Net profit in the first quarter grew 31% to Rs 1,319 crore on revenues of Rs 7,236 crore. Bangalore-based Wipro joins larger rivals Tata Consultancy Services and Infosys in handing out an upbeat outlook for the outsourcing industry, helping to erase some of the anxieties gnawing at it, including a sliding euro and rising wages.
Indeed, in the strongest statement made by an IT company chief yet on the demand environment, Wipro chairman Azim Premji said he does not foresee a double-dip recession.
“We are seeing traction; decision-making is on. We are now seeing reasonably sound indications that discretionary spending is back,” Mr Premji said. “We are not having any measure of concern.”
The soap-to-lighting company’s revenues from software services met expectations with a 14% rise to Rs 5,500 crore but the growth was softer than what TCS and Infosys reported earlier this month. Wipro’s revenues from IT products shot up 13% while those from consumer care and lighting were up 23%.
Wipro shares rose to Rs 433 before ending lower at Rs 412 on the Bombay Stock Exchange on Friday.
“While Wipro has a softer quarter versus TCS and Infosys in June, its 6.1% Q-on-Q revenue growth guidance for the September quarter makes amends, and indicates that demand is firmly on an uptrend,” brokerage CLSA said in a note.
“Note that Wipro has delivered around the top-end of its guidance for the last eight quarters,” CLSA added.
Wipro CFO Suresh Senapaty said the company was able to improve margins by 30 basis points sequentially because of operational improvements made in acquisitions and other efficiencies. That helped fend off cross-currency headwinds, a one-month impact of wage spikes and a higher percentage of onsite revenues.
Posted on July 16, 2010 by Atul
Tata Consultancy Services: Investors.
Yesterday, TCS announced a strong performance in the first quarter of the fiscal year. Is the market really improving dramatically or is this the pre-summer bump?
Revenues at $1,794 million
up 6.4% sequentially; up
21.2% Y-o-Y
Financial Highlights for Quarter Ended June 30, 2010:
- Operating Profits at $487 million; Growth 32.5% Y-o-Y and 5.1% Q-o-Q
- Profit After Tax at $403 million; Growth of 29.3% Y-o-Y and (4.9) % Q-o-Q
- Earnings Per Share at $0.21
Business Highlights for Quarter Ended June 30, 2010:
- Gross Addition of 10,849 Employees (Net Addition of 3,271 employees)
- 36 New Clients added
Please use the link below to view the entire press release.
http://www.tcs.com/news_events/press_releases/Pages/Q1-2011-Revenues-USD-1794-million-up-6.4-percent-sequentially-up-21.2-Y-o-Y.aspx <http://www.tcs.com/news_events/press_releases/Pages/Q1-2011-Revenues-USD-1794-million-up-6.4-percent-sequentially-up-21.2-Y-o-Y.aspx>
Posted on July 9, 2010 by Atul
I served on the board of Rural Sourcing Inc., which was founded by Kathy White, Former CIO – Cardinal Health, until this firm was acquired by Clarkson Consulting. A very viable alternative!
I was very impressed by the quality of resources in rural locations such as Jonesboro, Greenville etc. in states such as Arkansas, New Mexico and North Carolina.
Forget India, Outsource To Arkansas.
By CNN at July 08, 2010
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Looking for skilled, low-cost labor? Forget about India and China. How about Jonesboro, Ark.?
As the national unemployment rate hovers near 10%, some companies are starting to eye job-hungry areas of the country as prime candidates for the kind of outsourced work that once would have gone overseas.
Dubbed “ruralsourcing,” “rural outsourcing” and “onshoring,” the practice relies on two simple premises: Smaller towns need jobs, and they offer a cheaper cost of living than urban centers. So businesses that outsource work to these areas can expect to pay less — rates are often as much as 25% to 50% lower — than if they were hiring urbanites with comparable skills. More>>
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Tags: arkansas, india, outsourcing
Posted on July 5, 2010 by Atul
Danville Express : McNerney introduces bill to fight outsourcing.
Here we go again! Another politician working on making America less competitive and forcing American companies to have more disadvantages as they compete globally.
Jobs are not created by putting more hurdles in front of companies. Jobs are created by providing incentives for companies to invest in communities and new opportunities.
Has anyone done a study of how many jobs are being created by foreign outsourcing companies in the U.S.A.? Has anyone done a study to see what impact outsourcing is having on the fortunes of the buyers? Are they competing better and thus creating more jobs and better futures for their employees?
We are lot more connected than when most of these politicians started their careers. They need to spend more time understanding the connectedness of our world and how one needs to compete NOW!
Posted on July 2, 2010 by Atul
Pilot view: NBCs new comedy, Outsourced | Show Tracker | Los Angeles Times.
“You know something is mainstream, when it hits pop culture. This is going to be fun. The movie, Outsourced, was outstanding and if this series can carry that off, we are all looking forward to a fun series. I enjoyed working with the Producer etc. on the movie team to extend its applications to the corporate world. Loved the way the movie truly captured it all.” – Atul Vashistha
The following is from the LA Times Article
“Outsourced” is a single-camera comedy set in all-American company, Mid America Novelties, which sells anything from wallets made of bacon to whoopee cushions. Its call center has been outsourced to India, and 25-year-old Todd Dempsey has been transferred there to manage it. He quickly realizes his staff needs a crash course in all things American if they are going to help him increase sales, and he needs to learn more than a few things about India.
Who’s in it: newcomer Ben Rappaport (off-Broadway’s “The Gingerbread House”) as Todd;Rizwan Manji (“Privileged”) as Ranjiv; Sacha Dhawan (BBC’s “Five Days II”) as Manmeet;Rebecca Hazlewood (BBC’s “Doctors”) as Asha; Parvesh Cheena (“Help Me Help You”) as Gupta;Anisha Nagarajan (Broadway’s “Bombay Dreams”) as Midori; Diedrich Bader (“The Drew Carey Show”) as Charlie; and Jessica Gower (Network Ten’s “The Secret Life of Us”) as Tonya.
Who made it: Robert Borden (“The Drew Carey Show” and “George Lopez”) created it and is producing it.
Thumbs up: It’s a workplace comedy with a relatable, topical bent. The cast is fresh and impressive. Rappaport is a charming lead.
Thumbs down: It hasn’t quite found its comedic rhythm, but when it’s funny, it’s funny.
Verdict: If we can’t beat the outsourcing, why not join it? Potential here.
– Maria Elena Fernandez
