Archive for December, 2010

NC agency looks at outsourcing mental health tests

December 9th, 2010

North Carolina is exploring whether it can save money by outsourcing psychological evaluations and care of accused criminals who may suffer mental illness.

The News & Observer of Raleigh reports Wednesday that the state Department of Health and Human Services is asking private firms what they would charge to house about 90 patients. That number includes maximum security patients who could be accused of murder.

Those patients are now at Dorothea Dix Hospital. The Raleigh hospital stopped accepting new patients last week and could close next year.

Orange and Chatham county District Attorney Jim Woodall says prosecutors won’t like outsourcing the sensitive evaluations that help determine whether defendants are too mentally ill to stand trial.

Source:http://www.foxcharlotte.com/news/nc-news/111534894.html

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Overseas outsourcing slows IT

December 8th, 2010

In November, only 39 000 jobs were created with a scant 600 in the IT industry. In a report from TechServe Alliance, overall employment in the IT sector increased by 2.5% in 2010 though the outlook may be bright… if you work in Indo-China, the report says.

The CEO of US operations for Harvey Nash says while permanent hiring is taking place in IT within the US, outsourcing is actively being used to help keep costs down during the global recession.

Philippines emerges top outsourcing centre

Sri Lanka and China are emerging as key destinations for services investments, while Philippines has overtaken India as the top-ranked outsourcing centre, a report by IBM, a global information technology firm, has said, reveals Lanka Business Online.

In IBM’s Global Location Trends report for 2010, Philippines claimed top place, displacing India for the first time in terms of estimated workers, and China overtook Sri Lanka. The island retained its position at number 12 while China moved to five, from 13 a year earlier.

“China is continuing its ascent as a services destination, and confirms it should not be considered anymore ‘merely’ the world’s factory,” the report says. “Sri Lanka is another Asian country that has succeeded in positioning itself as an alternative to India.”

Radiology too ‘extreme’ to outsource

At this year’s Radiological Society of North America conference in Chicago, some experts predicted an outsourced future for radiology: exams taken in America or the rest of the developed world would be read by highly trained radiologists in India for a fraction of the cost of a domestic doctor, says DotMed.

But those radiologists worried about losing their jobs to readers in Bangalore should have no fear, according to a new study. In an article appearing in a forthcoming edition of the British Journal of Industrial Relations, a pair of economists suggest radiology is too “extreme” for normal offshoring, and that the rise of the Indian teleradiologist is mostly media speculation.

Source:http://www.itweb.co.za/index.php?option=com_content&view=article&id=39527:overseas-outsourcing-slows-it&catid=69

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Violence affecting nearshore outsourcing operations in Mexico

December 8th, 2010

Even as India remains the globally most preferred destination for offshore outsourcing, strategically Mexico has recently turned out to be a major attraction for the US majors like US Airways, Microsoft and Best Western International for nearshore outsourcing. Nevertheless, the nearshore outsourcing operations in Mexico have been adversely affected owing to the latest upsurge in violence related to the drug cartel in that country throwing the future of the entire IT activities in uncertainty.

It may be noted that the outsourcing operations in Mexico owes its origin to the distillery industry and the export-oriented assembly plants constructed along its border with the United States way back in 1960s. It is only recently that the country adopted nearshore operations focusing on IT outsourcing, including BPO and ADM (application development and maintenance). Over the years, the outsourcing industry in Mexico has already comprises over 2,000 IT firms employing around 550,000 skilled IT professionals and an increasing pool of talented workforce. In addition, every year over 64,000 IT professionals pass out from the 121 universities that are focused on technology – helping it to be way ahead of any other countries in Latin America.

A website report says that outsourcing to Mexico has numerous advantages, including significant cost savings. In addition, Mexico’s proximity to the United States, tile zone grouping, an educated and bilingual talent pool, familiarity with the US culture as well as encouraging trade agreements with the US and other Latin American countries have helped this country to successfully compete with several other outsourcing destinations globally. Precisely speaking, the North American Free Trade Agreement or the NAFTA has helped the bilateral trade between the United States and Mexico to swell to over $300 billion now.

Notwithstanding all these advantages of outsourcing to Mexico and its solid outsourcing base, the upsurge in violence has begun to affect businesses here. According to official estimates, the clashes between the government forces and the drug cartel as well as inter-cartel rivalry across Mexico has claimed over 28,000 lives since President Calderón launched a major offensive against the drug cartel in 2006.

Nevertheless, the Mexican government has been working hard to help the country emerge as a strong contender to India, arguably the most preferred outsourcing destination worldwide, as well as new IT service vendors by introducing the Program for the Development of the Software Industry (Prosoft) recently as well as launching a campaign to highlight the country’s strengths in the IT and BPO sector. Keeping the efforts of the government in view, several IT multinationals having operations in Mexico, such as Oracle and IBM, have promised to help in developing the country’s IT industry. Presently, six domestic software firms, including ABS-IBM, Sigma Tao-EIDON, Softtek, Stefamini and Itera, and each of them have highest rankings from the Software Engineering Institute for software development processes.

Apart from these local IT service vendors, a number of multinational IT organizations like Accenture, IBM, HP and Genpact who serve clients, including Ceridian and GE, have not only enhanced the status of the IT industry in Mexico, but have also generated over 2,000 jobs in the country.

On the other hand, keeping in view the recent concerns regarding their safety, outsourcing service providers in Mexico have beefed up their security strategies and arrangements in the violence-hit provinces like Baja California, Distrito Federal, Chihuahua and Nuevo León. The service providers have not only increased the number of armed guards at the offices and delivery hubs and built concrete barriers around their establishments, but also developed disaster management and evacuation methods to ensure that they may shift their facilities to other locations in case of any eventuality.

Significantly enough, a number of IT service vendors have describe the safety concerns as exaggerated. They are of the view that the ongoing violence in impacting the perception rather than the operations. Citing an example, they point out while 14 out of every 1000 people were murdered in Mexico in 2009; in some other Latin American nations the rate is as high as 70 per cent. In fact, the murder rate in Brazil was 25 per 1000 persons in 2009.

All these statistics notwithstanding, a number of existing as well as potential clients of nearshore outsourcing have already prohibited their employees from visiting Mexico, especially the areas worst hit by violence. Therefore, in order to retain their clients, outsourcing providers in Mexico need to be able to handle these issues and risks related to the violence unleashed by the drug cartel. In the instance of the violence continuing for long, it will have long-term impacts on the IT industry in Mexico and may also damage the country’s present reputation and position as a favored nearshore outsourcing destination.

Source:http://www.sourcingline.com/resources/violence-affecting-nearshore-outsourcing-operations-in-mexico

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Kelly Outsourcing and Consulting Group (KellyOCG) Selected as Services Procurement Outsourcing Partner for Rio Tinto in Australia

December 8th, 2010

KellyOCG, the Outsourcing and Consulting Group of Kelly Services, today announced it has signed a Letter of Intent to enter into a major services procurement outsourcing contract with leading international mining group Rio Tinto (RIO) in Australia.

The Contingent Workforce Outsourcing (CWO) practice of KellyOCG will leverage its experience in delivering services procurement programs while utilizing its global footprint to support Rio Tinto’s labor and supplier management strategy.

“Based on Rio Tinto’s global presence and cumulative spend in services, this program is designed to become one of the largest and most innovative programs in the industry in terms of size, scope and global scalability,” said Rolf Kleiner, senior vice president and general manager, KellyOCG.

“We choose to work with KellyOCG based on their expertise as a workforce managed service provider and their commitment to the Australian market,” said Scott Singer, Global Head of Procurement, Rio Tinto. “Nearly half of Rio Tinto’s 100,000 strong global workforce is comprised of contractors and a key driver of this program is improving contractor compliance with our Health, Safety and Environment (HSE) standards. This program is also expected to provide major improvements in our contractor administration process through enhanced governance and increased data visibility.”

Encompassing a broad spectrum of operational activities from supporting supplier qualification and contractor on-boarding, through sourcing and transactional management, the partnership is an entirely new model for contractor administration within Rio Tinto. Expected key outcomes include:

strengthening of supplier qualification and induction processes to support improved HSE performance of Rio Tinto suppliers
a range of commercial benefits achieved through greater process efficiency enhanced relationships with the supplier community.

“We are very pleased to be partnering with an organization committed to innovation and program excellence such as Rio Tinto. From the outset they have recognized the potential for business transformation through this approach,” said Kleiner. “The scope of the partnership speaks to the increasingly strategic nature of workforce and services procurement. For KellyOCG it represents a continuing evolution of both our CWO practice as well as our industry expertise in the global resources and energy space.”

With this agreement, KellyOCG becomes the only Managed Service Provider with customers engaged on programs scaled to support over $1billion in spend across all three regions of the world.

Source:http://www.newsmaker.com.au/news/6447

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Rio Tinto OZ selects Kelly Outsourcing for Services Procurement Outsourcing

December 8th, 2010

KellyOCG, the Outsourcing and Consulting Group of Kelly Services® (NASDAQ: KELYA) (NASDAQ: KELYB), today announced it has signed a Letter of Intent to enter into a major services procurement outsourcing contract with leading international mining group Rio Tinto (RIO) in Australia.

The Contingent Workforce Outsourcing (CWO) practice of KellyOCG will leverage its experience in delivering services procurement programs while utilizing its global footprint to support Rio Tinto’s labor and supplier management strategy.

“Based on Rio Tinto’s global presence and cumulative spend in services, this program is designed to become one of the largest and most innovative programs in the industry in terms of size, scope and global scalability,” said Rolf Kleiner, senior vice president and general manager, KellyOCG.

“We choose to work with KellyOCG based on their expertise as a workforce managed service provider and their commitment to the Australian market,” said Scott Singer, Global Head of Procurement, Rio Tinto. “Nearly half of Rio Tinto’s 100,000 strong global workforce is comprised of contractors and a key driver of this program is improving contractor compliance with our Health, Safety and Environment (HSE) standards. This program is also expected to provide major improvements in our contractor administration process through enhanced governance and increased data visibility.”

Encompassing a broad spectrum of operational activities from supporting supplier qualification and contractor on-boarding, through sourcing and transactional management, the partnership is an entirely new model for contractor administration within Rio Tinto. Expected key outcomes include:

strengthening of supplier qualification and induction processes to support improved HSE performance of Rio Tinto suppliers a range of commercial benefits achieved through greater process efficiency enhanced relationships with the supplier community “We are very pleased to be partnering with an organization committed to innovation and program excellence such as Rio Tinto. From the outset they have recognized the potential for business transformation through this approach,” said Kleiner. “The scope of the partnership speaks to the increasingly strategic nature of workforce and services procurement. For KellyOCG it represents a continuing evolution of both our CWO practice as well as our industry expertise in the global resources and energy space.”

With this agreement, KellyOCG becomes the only Managed Service Provider with customers engaged on programs scaled to support over $1billion in spend across all three regions of the world.

Source:http://frontierindia.net/rio-tinto-oz-selects-kelly-outsourcing-for-services-procurement-outsourcing

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An IT start-up in the conflict zone of Kashmir

December 8th, 2010

It needs not just courage and a brave heart, but immense confidence and commitment to give up hefty pays and cozy life working abroad and take up the challenges to start a tech firm, not in Bangalore but in the conflict zone of Srinagar, Jammu and Kashmir.

It was in 2004, when Fayaz Bhat, Amin Bhat and Tahir Kazi – three techie friends – took a bold decision to leave their jobs abroad and returned back to pursue their aspirations to do something worthy for locals in the state, the land once called by Jawahar Lal Nehru as the heaven on earth.

“We three friends came together and co-founded Musky Software Solution (MSS) in December 2004 with the initial investments of Rs.5 lakh. Our concept was that we all belonged to J&K, so wanted to give back to the place where we were born,” says Fayaz Bhat.

Looking at the turbulent socio-political situation in J&K over the past three decades due to constant terrorist activities, security issues, curfews and so on, setting up an IT business will not be considered a wise decision. “Yes, we were aware of the problems here but were enough confident to meet those challenges and determined to give a chance to the locals with our positive thinking,” he adds.

Because of the uncertain situations, Bhat takes extra care and safety of his staffs. He has created a residential and kitchen area where the staffs prepare food and stay overnight during curfews.

According to Bhat, the state has some 8-10 engineering colleges, institutes and universities, so every year a big number of tech graduates pass out from the state. “So getting IT staffs here is not a major issue but getting work or projects regularly is the key problem for companies like ours,” he explains.

Initially, it was the support and references of friends based abroad that offered IT projects, back office work, software development and support type of jobs to MSS.
Owing to the difficulty in getting a smooth flow of work, they decided to have five business lines rather than having just one specialized sector, in order to keep the business sustained.

“Our business include software development, flash product development, banking services, IT staffing and recruitment and IT consultancy,” Bhat says.

Apart from the socio-political situations, the start-up also faces issues like regular power-cuts, inconsistent and low Internet connectivity, lack of business locations along with non-availability of evening flights, which hampers client visits and meetings.

Despite the challenges and problems, today MSS is a six-year-old firm with 30 staffs, two offices in Srinagar and Jammu and also is planning a third one in Bangalore in the next fiscal.

“Though our client base is small, most of them are from the US, Africa and other countries. On an average we are able to add a couple of clients every year and growing at 50 per cent annually. Last year we posted revenue of over Rs 1 crore,” Bhat claims. Currently, MSS has 10 clients from verticals such as banking, healthcare, e-commerce, exports along with software companies for outsourcing work.

According to Bhat, there are some 45 plus small and mid-size IT firms providing various IT support and services such as data entry, web designing, back-office outsourcing and software developments.

But in the absence of a state IT policy or vision, he reckons that the prospects of utilizing IT resources and boosting small IT firms here highly depends on big IT enterprises such as Infosys, HCL, Wipro and TCS.

“If these big companies can share or outsource even 0.5 per cent of their non-critical work or back-office jobs to firms in J&K, then it will not only boost the IT sector but will also create big job opportunities for the locals,” he appeals.

“If telecom firms are operating and doing business in J&K, why can’t the tech companies follow the same and change their attitudes?” asks the entrepreneur with a mission.

Source:http://www.ciol.com/News/News/News-Reports/An-IT-start-up-in-the-conflict-zone-of-Kashmir/144348/0/

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HP expands Indian outsourcing operations

December 8th, 2010

Hewlett-Packard has revealed that the $1 billion “next generation” Enterprise Services business plan announced in June 2010 will centre on three new outsourcing facilities being built in India.

The centres, to be located in India’s southern IT hubs, Bangalore and Chennai, will take up around 150,000 square metres, according to a report by the Wall Street Journal.

In June, HP flagged that its IT services revamp would see 9,000 roles shed over the coming years, however it did not disclose its Indian expansion plans at the time.

Tuesday’s announcement comes just two months after UK union Unite accused HP – the UK’s Ministry of Defence’s largest IT service provider – of exporting roles when it announced it would retrench a further 1,300 more services workers on top of the 900 it initially declared.

The union also said its Indian members that work for HP had been complaining of “unreasonable” workloads at the time.

The centres expand on HP’s existing Indian business process outsourcing operation, MphasiS, which currently employs around 38,000 staff.

“India offers a complete range of capabilities in applications, infrastructure technology and business process outsourcing for global and domestic clients,” HP told the WSJ.

Source:http://www.itnews.com.au/News/241007,hp-expands-indian-outsourcing-operations.aspx

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