Six Indian cities – Bangalore, Delhi NCR, Mumbai, Chennai, Hyderabad, Pune – are among the eight top global destinations for outsourcing of services, according to a new survey released Tuesday.

The other two are the Philippines’ Manila NCR and Ireland’s Dublin city, according to the 4th Global Services-Tholons Top 50 emerging outsourcing destinations survey, jointly done by Global Services from CyberMedia and Tholons, a services globalisation advisory firm.

The Next 10 Outsourcing Destinations considered to be ‘Top 10 Aspirants’ from a total of 68 destinations is dominated by China’s Shanghai, Beijing and Shenzhen, Vietnam’s Ho Chi Minh City and Hanoi, Poland’s Krakow, Argentina’s Buenos Aires, Egypt’s Cairo and Brazil’s Sao Paulo.

Avinash Vashistha, CEO of Tholons says: “For a CIO today, finding a Centre of Excellence is more than just lower cost. It must consider location, risk mitigation for business, cultural affinity and scalability of the skilled workforce.”

“The service providers need to think through their offerings so as to differentiate as the competitive advantage is rapidly vanishing due to cut throat competition and market saturation,” adds Vashishtha.

India continues to top the list with revenues of US$40 billion in IT-BPO export services in 2008. Indian IT-BPO export services posted 35 percent year on year growth rates in the last five years.

Interestingly India’s FDI inflows posted the largest increase globally at 46 percent in 2008 — from $25 billion to $46 billion even as global FDI flows decreased from $1.9 trillion to $1.7 trillion and several developing economies struggled to acquire investments from client nations.

Compared to the previous year’s rankings, this year’s study reveals minimal shifts in rankings because of the overall slowdown in the pace of outsourcing activity in the face of global recession.

Seven Chinese cities – Shanghai, Beijing, Shenzhen, Dalian, Guangzhou, Chengdu and Tianjin – and six Indian cities – Chandigarh, Kolkata, Coimbatore, Jaipur, Bhubaneswar, Thiruvananthapuram – make it to the list of next 60 outsourcing destinations.

The study lists India, Philippines, Ireland, China and Brazil among Top 5 Offshore Nations “with a high degree of maturity and record of successful delivery capabilities.”

Canada, Russia, Mexico, Vietnam, Poland are listed as Top 5 Emerging Nations. The difference between the Top 5 and the Next 5 offshore nations is most pronounced in the service level maturity, the study said.

Source:http://www.ciol.com/News/News-Reports/India-shines-as-global-outsourcing-destination/211009126599/0/

The list of challengers to U.S. tech supremacy may be getting longer. Many pundits say the greatest threats to the nation’s status as a tech superpower are China and India. Those people would do well to look south.

Aside from notable exceptions such as Venezuela, South America is a growth dynamo with a young population and rapidly maturing economies. Much recent growth has come from rich natural resources and a commodity bubble that rained cash on farmers, miners, and drillers alike.

Many of the region’s countries want to break their dependence on commodity cycles. And, increasingly, they see tech as a way to create sustained, long-term economic development. Chief among them is Chile. Flush with cash from the recent copper boom, Chile aims to attract Northern entrepreneurs who seek a lower burn rate. Business leaders in Chile are closely studying ways to lure the highly skilled H-1B holders trapped in limbo by antiquated and economically backward U.S. immigration rules. With deep pockets and generous incentives, Chile has advantages that may let it join India as a global R&D center.

ENTREPRENEURS ARE KEY
To do that, however, Chile needs to take some important lessons from India and China. In particular, Chile must focus on ways to attract entrepreneurs and cultivate innovation—not just become a hub of commodity outsourced services such as handling customer service calls.

Chile’s aspirations became more focused after 1996, when it lost to Costa Rica in a bid to become the site of a $300 million semiconductor assembly and testing plant for chipmaker Intel (INTC). Stung by the setback, the Chilean business community and government developed a national plan to encourage foreign investment. In 2000, the Chilean Economic Development Agency (CORFO) set about marketing the country’s advantages as an IT outsourcing center. The agency offered financial incentives for companies to locate there. By 2006, Chile’s outsourcing industry was generating $200 million in revenue and employed 6,700 workers.

Buoyed by these successes, the Chilean government got more ambitious and moved up the IT ladder. While lower-level service providers were still welcome, the focus shifted to higher-value services, including applications development and management, systems integration, and the handling of more sophisticated tasks, such as human resources, finance, and supply chain management—known in industry circles as business process outsourcing (BPO).

RAMPING UP EDUCATION
The result? In 2008, Chile’s outsourcing industry booked $840 million in revenue, employed more than 20,000 people, and attracted companies like Equifax (EFX), JPMorgan Chase (JPM), Yahoo! (YHOO), and Oracle (ORCL). Raúl Rivera, chairman of Chile’s Foro Pro Innovación (Innovation Forum) and one of the original architects of Chile’s outsourcing strategy, confidently predicts the country can export $5 billion in services by 2015.

Here’s the rub. Chile simply doesn’t have the population and educated workers to support such lofty ambitions. Chile’s universities produce 1,400 graduates a year in computer science and IT. Chilean vocational schools produce another 4,500. Most don’t speak English.

Rivera recognizes the challenge and argues that the country is rapidly ramping up its education system. Part of his solution is to ramp up language training for skilled but underutilized workers who are interested in higher-level IT services. But as the country draws more engineers into IT, other parts of Chile’s economy stand to suffer. Who runs the mines when mining engineers toss off their hard hats for higher-paying jobs coding software? The same question applies to civil engineers or professors who abandon their posts for higher pay in IT services.LIMITED ENGLISH HURTS CHINESE
India faced similar challenges a few years ago, but its private industry was able to avert disaster. Faced with severe talent shortages, escalating salaries, and a lagging education system, Indian industry had to rethink how it recruited, trained, developed, and retained its workforce. India started by adapting what worked best for companies that were outsourcing R&D to India. Then Indian companies in diverse industries started improving on these techniques and methods; they refined and integrated them into a unified system.

By 2008, the outsourcing industry achieved attrition rates American employers would envy, and it grew to $60 billion. (At the same time, China struggled to gain traction in outsourcing. Despite massive investments, its outsourcing revenue for 2008 was a meager $1.6 billion. The Chinese just could not overcome the handicap imposed by their lack of English skills.)

The real gold mine for Chile, however, lies in attracting entrepreneurs. The country’s population of 16 million severely limits its outsourcing ambitions. Outsourcing requires lots of people. Innovation, on the other hand, requires fewer people and adds much more economic value to a country’s economy and a company’s bottom line. The large Indian outsourcing firms have learned this and are now focused on expanding outsourced research and development services for global multinationals.

A LESSON FROM INDIA
In areas such as aerospace, automotive, and semiconductors, R&D was once considered sacrosanct and never to be shipped offshore. But Indian firms such as Infosys (INFY), TCS (TCS.NS), and HCL (HCLT.NS) have cracked the code and are drawing contracts for work that adds core intellectual property value. This shift to focusing on core innovation brings with it a mental shift in how to create value and, ultimately, a shift to an economy where intellectual property creation is valued over service provision.

The lesson from India, then, is that Chile can continue to support modest IT services growth but should refocus on innovation with an aim to attract entrepreneurial talent from the U.S. Chile has huge advantages over China and India, themselves attracting talented expats. Chile’s economy and markets are among the most free in the world. Chile enjoys low levels of corruption, a pristine environment (with the exception of some timber and copper regions), and beautiful weather. The country is safe and secure for foreigners with weather like that of California.

With pockets lined in copper riches, Chile has rolled out extremely tempting incentives. Want to relocate to launch a business? No problem. Bring $500,000 to invest over five years and you can launch in Chile with legal residency status. Not sure you’ll like it down there and want to check it out first? The Chilean government will cover 60% of your due diligence costs, or up to $30,000, to visit and explore Chile. And it will consider granting another $30,000 to foreign founders of tech companies seeking to launch in Chile. If a founder locates the company in one of the country’s tech centers, the government will pay for five years of rent (up to $1 million).

GOING FOR THE BRASS RING
The Chilean government also offers big bucks to cover training costs for hiring locals and will subsidize efforts to import high-skilled workers from anywhere else in the world. A company that wants to purchase or build a lab or a facility can expect a 40% subsidy from the government on any purchases or projects totaling $2 million or less.

Chile is now hatching plans to come to the U.S. to talk to talented techies seeking greener pastures. I encourage the country to step up these efforts.

This South American gem has the potential to bring Silicon Valley south. Why bother to be another Bangalore when you can grab the brass ring on the first try and build an innovation economy without the baggage?

Source: http://www.businessweek.com/technology/content/oct2009/tc20091020_195682.htm

Influential lawmakers said Tuesday that Indiana welfare subcontractor Affiliated Computer Services Inc. will come under closer scrutiny now that Gov. Mitch Daniels has fired IBM Corp. from the project.

Rep. Peggy Welch, a Bloomington Democrat who sits on both the State Budget Committee and the General Assembly’s Medicaid Oversight Commission, said some lawmakers wonder whether Dallas-based ACS was responsible for some of the poor service, lost documents and other problems that resulted in Daniels firing IBM Thursday from a 10-year, $1.34 billion contract to automate intake for food stamps, Medicaid and other welfare benefits.

“We’re going to be watching closely on ACS, because there is a perception that they are just as bad an actor as IBM,” Welch said after a meeting of the Legislature’s Medicaid Oversight Commission.

Rep. Suzanne Crouch, R-Evansville, said lawmakers remain skeptical of ACS because it was brought in by Mitch Roob, a former ACS executive who oversaw the IBM/ACS project as Family and Social Services Administration secretary until January, when he became Indiana’s secretary of commerce.

“People are uncomfortable that ACS is still in place and that they were brought on board by former Secretary Roob,” said Crouch, one of several Evansville lawmakers who’ve led legislative criticism of the welfare changes.

Roob’s office did not immediately respond to a message seeking comment.

The lawmakers’ comments provided the first indication since IBM’s firing that political pressure also was building against ACS, one of IBM’s largest partners in the welfare outsourcing that moved 1,500 case workers from the state’s payroll to ACS’ employment 2 1/2 years ago. ACS workers compile eligibility data on welfare applicants before state employees decide which benefits to award.

ACS spokesman Ken Ericson said when IBM was fired last week that his company was looking forward to working more closely with FSSA and that it “remains fully committed to the success of this project.”

When asked about lawmakers’ comments Tuesday, he referred to those earlier remarks.

Welch and Sen. Luke Kenley, R-Noblesville, briefed other members of the Medicaid Commission on steps FSSA is taking to implement a “hybrid plan” that will incorporate the call centers, document imaging and Internet access that IBM brought to the welfare program along with the face-to-face contact FSSA offered.

FSSA Secretary Anne Murphy is set to discuss the transition from the IBM contract, which expires Dec. 14, to the hybrid plan Friday in Bloomington before the State BudgetCommittee chaired by Kenley. She told the panel last month that the IBM project needed more face-to-face interaction between caseworkers and welfare recipients.

Murphy met with Kenley, Welch and some other Budget Committee members last week after Daniels canceled the IBM contract.

Kenley, in response to a question from Medicaid Commission member Rep. Charlie Brown, D-Gary, said FSSA has no immediate plans to roll out the automation and other welfare changes to any new counties. The changes are in place so far in 59 counties with about a third of the state’s welfare caseload of 1.2 million people, but not in some large cities such as Indianapolis, Gary, South Bend and Elkhart.

FSSA spokesman Marcus Barlow said the comments by Welch and Crouch about ACS were “unfortunate” because Daniels said the problems were with IBM’s system and not specific companies.

Source : http://www.ajc.com/business/ind-lawmakers-acs-performance-167761.html

IMS Health Inc., reported to be in takeover talks with private-equity firms, said it is exploring strategic alternatives.

IMS, provider of prescription data to drugmakers and analysts, hired Foros Securities LLC to advise a special board committee on possible transactions, the Norwalk, Connecticut- based company said in a statement. IMS also hired Deutsche Bank Securities Inc. as its financial adviser, according to the statement.

The company’s shares rose the most ever yesterday after the Wall Street Journal reported IMS was in talks to sell itself to a private-equity firm. IMS’s revenue is set to decline about 10 percent this year after pharmaceutical companies have merged and cut back on spending, said Alastair Mackay, an analyst with GARP Research & Securities Co. in Baltimore.

“There can be no assurance that the exploration of strategic alternatives will result in a transaction,” IMS said in the statement. “The company does not expect to make further public comment regarding these matters while its exploration process continues.”

IMS shares rose 2 percent to $17.75 at 5:35 p.m. in extended trading on the New York Stock Exchange after closing down 43 cents to $17.41.

55-Year History

IMS was founded in 1954 as Intercontinental Marketing Services and focused on providing data about the European pharmaceutical market. It was acquired in 1988 for about $1.8 billion by Dun & Bradstreet Corp. then spun off as a public entity a decade later.

In June, the U.S. Supreme Court rejected a challenge to state laws aimed at limiting the ability of drugmakers to target individual doctors with sales pitches. IMS and competitor Verispan LLC sought to invalidate a New Hampshire law restricting the sale of information on physicians’ prescription- writing practices.

IMS has been trying to expand its business into consulting and increase sales outside the U.S. and western Europe. It is reducing costs by outsourcing jobs and said last year it would cut 10 percent of its workforce, or 1,050 jobs.

Source : http://www.bloomberg.com/apps/news?pid=20601103&sid=aj7sfalzwK2c

At a recent Global Storage seminar on Leveraging the Cloud – Enterprise Managed Services, organisations talked about their pain points for Disaster Recovery and Back up and how Global Storage’s Enterprise Managed Disaster Recovery and Backup services, EnvironmentReady™ and DataReady™ have helped alleviate these. The panel consisted of CIOs and IT Managers from Middletons Law Firm, Pacific Hydro, Southern Rural Water, Sustainability Victoria and Heart Foundation.Following is the discussion by these leading organisations about Global Storage Managed Services for disaster recovery and backup, the engagement process to implement these and the benefits that were delivered
Middletons – Sam Sofianos, Director, Technology Services

Question: When Global Storage first engaged with Middletons, they were facing some immediate challenges in backup. Can you tell us about how DataReady helped solve these challenges?

Sam Sofianos: Our immediate problem was that our backups were eating into the working day. We needed to address that and so we looked at whether it was worthwhile investing capital into buying equipment and de duplication software or other alternatives in the market place.

We engaged Global Storage and talked to them about the DataReady offering from the outset and it really sorted out our backup window issues. From our perspective, it was a really good holistic solution in that it addressed a number of other things , like ensuring that that our data was stored in an offsite secure location as well as in a top tier data centre, which is important for a law firm. It simplified our backups and enabled us to centralise and standardise our backup process and has enabled us to redeploy resources in other areas.

We were really happy with GlobalView (Management & Monitoring System) as we found it very easy to use and it simplified bringing back files, particularly ones that are stored within the cloud for the first 30 days.

Question: Understanding it makes sense from a cost perspective to extend into Disaster Recovery, can you talk to us about the value Middletons see in implementing EnvironmentReady?

Sam Sofianos: Global Storage already backs up our data, so we’re pretty much three quarters of the way there. This makes it an easy decision for us. EnvironmentReady is a good ‘value-add’, so from our perspective it just makes a lot of sense to extend into this.

From a capital expenditure perspective, for us to try and replicate disaster recovery and do it all ourselves, it would take significant financial investment. It makes sense for us to partner further with Global Storage – we have already got confidence in the product and it will really simplify our Disaster Recovery.

Pacific Hydro – Daniel Hayward, IT Manager

Question: Pacific Hydro went through a 12 month process of evaluating their requirements for DR. Can you tell us about that process and how much of it was driven by IT and how much was driven by the board?

Daniel Hayward: In terms of whether it was more IT driven or Board driven, it started off with IT exploring the options of what we could potentially be looking at in the future, and then was backed up by the audit and risk committee , which analysed risks in the IT infrastructure, one of which being that our disaster recovery was inadequate.

With the backing of the Audit and Risk Report, disaster recovery became a high priority on our agenda and we now had the knowledge that the management and the Board would seriously consider what we were putting forward. We then completed our proposal outlining the currents system, weaknesses, and comparison of appropriate products from different vendors, which was presented to management and the Board. By about mid 2008 we had signed off on the project. (to implement EnvironmentReady Managed Disaster Recovery).

Question: Pacific Hydro was an early adopter of VMware. Can you tell us what was important for Pacific Hydro in protecting and recovering a virtualised environment?

Daniel Hayward: As an early adopter of VM Ware, we already knew the features and benefits of VMware, which we use on a day to day basis. We knew that it was important for us to have those same features and flexibility inside the disaster recovery site.

In terms of costs, it (EnvironmentReady) meant that we did not have to put in a large amount of capital and we were to expect a monthly price. Prices would only grow when our data and resources grew, which meant it was a lot easier to budget for.

It was important for us to know that EnvironmentReady was going to make it a lot easier for us to conduct testing on our DR environment, and that testing with a live full communications cut over would be easy and seamless to cut over and cut back.

Southern Rural Water – Amit Khairajani, ICT Manager

Question: As part of the business case for Environment Ready, SRW conducted a detailed TCO analysis of an inhouse DR solution, versus outsourcing. Could you tell us about this process and how Global Storage Managed services compared to building an inhouse DR solution?

Amit Khairajani: We tendered out the whole Disaster Recovery solution and got three or four different kinds of proposals. The two we looked at closely were the Global Storage proposal for a managed service and one that was for setting up a replicated site. We had our own offices, so we did not have to purchase or lease a separate site for DR, but we calculated the cost of running a similar sort of set up at our second site and found the Global Storage services to be more cost efficient. We looked at the total cost of ownership of running a one to one service off the same number of servers as san replication across the sites, taking into account the cost of power, cooling and the cost of resources that you’ve got to keep at hand to make sure that if there was a disaster, the solution would actually work, especially after such a major investment.

Our total cost of ownership with the Global Storage solution was actually lower than the total cost of ownership for replicating the entire environment to set up a second site. We had our own offices, so we did not have to purchase or lease a separate site for DR, but we calculated the cost of running a similar sort of set up at our second site and found the Global Storage services to be more cost efficient.

We looked at the cost of actually running a second site, taking into account the cost of power, cooling and the cost of resources that you’ve got to keep at hand to make sure that if there was a disaster, the solution would actually work. It just made sense to choose the Global Storage managed service – the total cost was lower, the solution was fully managed so we didn’t need our own resources to manage it and the solution completely mitigates our risk in the event of a disaster. We have been affected by natural disasters such as fires as floods, several times in the last few years and we could not accept the risk of not knowing whether we will still be ok after such an event. We needed a DR solution in place that we know will work when needed and Global Storage provide this for us.

Question: EnvironmentReady provides regular testing of the disaster recovery plan. Could you please tell us about how SRW has found this testing to benefit the organisation and about the level of comfort this testing provides that your DR plan will work when needed?

Amit Khairajani: We just finished the third DR test and it was successful. The testing is very simple and we don’t have to worry too much about it – Global Storage recover our environment to their recovery servers. We simply activate it and a couple of days later, we get in, test all our applications, make sure all our data is up to date and get the business to sign off on it. Within two weeks we have a report that goes to the board saying everything is signed off and everything is a success. What that does is give comfort to the business that the DR solution will work when activated and the testing process is a stress we don’t have anymore.

Sustainability Victoria – Patrick O’Brien, ICT Services Manager

Question: Sustainability Victoria carried out a Business Impact Analysis to understand the risk to and exposure of the organisation. Can you tell us about the key outcomes of the BIA and how Global Storage has helped addressed the BIA requirements.

Patrick O’Brien: The key findings of the business impact analysis were that the key business activities rely heavily on the ICT systems such as the data bases, business applications and email and that without these ICT systems the business would struggle to meet its vision and purpose. The recommendation was that with so much reliance upon ICT systems it is imperative that the ICT Disaster Recovery Plan is integrated with the business recovery plans and these need to be planned around the Maximum Acceptable Outage figures for these key business activities.

So how did Global Storage help? The disaster recovery as a managed service is really disaster recovery made easy. For us we didn’t have to look at any additional resources and the implementation of the service was a breeze – it went forward in three months from time of implementation to test.

The DataReady managed backup service, now allows us to hold 30 days of data onsite and it means that the recovery of data for single systems or a total server can be completed in a matter of hours. The EnvironmentReady managed service has been tested and has allowed us to recover the whole of our ICT operations well within the maximum acceptable outage time.

Question: Considering the charter of Sustainability Victoria, to have a positive impact on sustainability, what environmental factors were examined when comparing Environment Ready to a more traditional DR solution?

Patrick O’Brien: At Sustainability Victoria we measure all energy that we use in the organisation and that includes measuring all energy used to provide ICT services. We are continually looking at ways to improve our energy consumption and at how can we improve that through better use of ICT technologies. When we look at our products and services we evaluate them on environmental criteria as well as functionality, cost and standard issues.

So when we were looking for a disaster recovery service we were really unsure what would be the implications for our energy use ie. how would adding another service impact our energy use? Some of the standard offerings we were looking at such as running dedicated servers with the associated infrastructure offsite did not look good. We were a bit concerned that some of these solutions were potentially going to double our energy use.

When we reviewed the Global Storage managed services solution, it was quite exciting to see an opportunity to introduce a disaster recovery service that would achieve our maximum recovery times and at the same time address our energy issues. The Global Storage solution was way out in front in the environmental evaluation.

Heart Foundation – Alan Arthur, National IT Manager

Question: For Heart Foundation, an important part of the approval process was to also have the IT team on board with the outsourcing position. How did you go about achieving this?

Alan Arthur: When we were looking at the various options for disaster recovery, such as internally hosted, partially outsourced and fully outsourced, we realised that there were going to be differing resourcing requirements for each of those, and also that it was going to be a fairly significant change management exercise as far as the IT team were concerned.

It’s quite a change of mind set when you’ve got system administrators who are used to having physical systems, tapes that are moved around the place on a daily, weekly and monthly basis, to the concept of having an appliance which holds a full 30 days of backup and also having a full 3 months of online backup available.

Conceptually we found it difficult to get our minds around how that would actually work and how the DataReady and EnvironmentReady services would be provided. So we had a series of workshops with Global Storage where they ran through the process in terms of how the backups and restorations worked. By the time we had gone through those, our system administrators were quite comfortable with the solution and actually quite excited about what it could provide for us in terms of being able to perform file restoration and not having to worry about of moving tapes and maintaining separate physical servers from a DR environment.

So by Global Storage providing the resources to run the work shops for us, what could potentially have been an issue from a change management point of view actually worked out to be quite a selling point of the system with our system administrators as we went down the process, which was great.

Question: Heart Foundation has national offices with distributed sites. As a national customer, can you tell us how you found the engagement from a project delivery, coordination and rollout perspective?

Alan Arthur: As we went through the due diligence process as part of the proposal, we spent a lot of time talking to Global Storage about their offering and how it works. We spoke to reference customers as well, asking some of the uncomfortable questions about when it doesn’t work and what problems have occurred. I was happy to say that all of those reference checks were quite positive and people seemed genuinely happy with the offering.

When we had the proposal approved and started working with Global Storage to do the implementation, it was evident that what they had demonstrated in the proposal phase and said they were going to do in the engagement, was not just talk. They actually delivered on that.

It was quite clear from the very first kick off meeting that they’d obviously been through the process before. In terms of supplying all the project templates and documentation for data capture and information, they knew what they were doing.

Whilst we were looking at the process as something that was a bit unique and potentially had some risks and concerns from our point of view, it was very much shown that Global Storage had done this before – they knew what they were doing and they turned up with the right information. We basically came away from all the project meetings with the feeling that they were doing what they said they would do as part of the proposal, they’re asking the right questions and saying the right things. So that comfort level we got with the initial proposal followed through to the implementation delivery and having done our first test in the last couple of weeks it has flowed through to that as well.

About Global Storage

Global Storage is a leading provider of enterprise managed disaster recovery, backup and archival services out of the cloud. By offering specialised consulting on data protection requirements, Global Storage assists CIOs and IT managers with a strategy to mitigate business risk, deliver cost savings and improve efficiency. Global Storage’s expertise and specialisation in disaster recovery, backup and archival enables them to deliver enterprise class data protection to meet the most stringent business requirements for business continuity.

Global Storage EnvironmentReady™, DataReady™ and ArchiveReady™ managed services combine continuous data protection, data deduplication and advanced virtualisation technologies with proven process and methodology to assist organisations with their data management and recovery objectives. These services provide enterprise customers with a simple, scalable, cost effective capability to protect and manage their data assets.

Leveraging these services out of the Cloud can benefit organisations by dramatically reducing cost and improving efficiency and resource utilisation. Global Storage Cloud services are leading the way in which Disaster Recovery, Backup and Archival services are being delivered to Enterprise Organisations.

Source : http://www.itwire.com/content/view/28678/545/