Archive for February, 2011

Working with IT outsourcing companies promises impressive results

February 28th, 2011

IT Outsourcing Companies in India put their weight behind projects ensuring they successfully work on them and complete them to keep pace with client expectations. You can count and bank on them for ensuring projects are done on time and contain the desirable quality that clients usually seek in them. The approach they follow is accordingly and the mechanism they put in place ensures things stay in order.

The reason your project is seen off desirably is because of the experience the vendor has piled up over the years. Assignments are finished unbelievably well and quite pristinely for the vendor has eons of years of experience under his belt and has many successful projects to his name. IT Outsourcing Companies  in India have been involved in the business long enough to understand how the business functions and have implemented a global delivery model through which they see off every project they take up on time.

They have written code long enough for a plethora of projects apart from designing websites and coding highly complex applications. They have consistently done all this long enough to know by what time is the project over and till when it ought to be delivered.

Your project too goes through a similar fate. Given the highly client centric approach IT Outsourcing Companies in India follow, assignments are bound to be done on time and delivered within timelines. The results tell the tale. Almost all times, the results are desirable for a lot of post project work happens on them. Once the project is over, the vendor gets down to business and provides tremendous technical support ensuring any anomaly that comes up is immediately rectified and looked into.

The experience you get out of such alliances is a very fruitful one for the professionalism Indian IT Outsourcing Companies are famous for. They commit themselves to a project and ensure its delivery happens well within the time frame.

Working with them will ensure you of a successful project with the quality you seek too delivered in the process. The companies in India are very agile and pro active in ensuring this happens well and within time.


BPO calls reach B-School campus

February 28th, 2011

Managerial and consulting roles in call centres attract IIM graduates.
Business process outsourcing (BPO) firms that so far hired from tier three B-schools will now flaunt IIM graduates. Take the case of Delhi-based BPO firm EXL Services which has managed to hire over 10 management graduates from India’s premier Indian Institute of Management (IIM), Ahmedabad. The highest ever for any BPO company so far, EXL Services has hired the IIM-A graduates for general managerial and consulting roles.

“This year we have been aggressive in hiring from B-schools as we want to grow our foot-print in these management schools. We have been hiring from B-schools since 2003-04, but that has always been limited to one or two students. This year we have managed to give offer letters to 10 students from IIM-A itself. Last year we hired around seven management graduates from top B-schools,” said Sanjay Gupta, Global HR Head, EXL Services. The company is visiting five to six more B-school campuses this year to meet its target of hiring 15-18 management graduates. The company is of the view that the focus on management talent is due to the shift that the industry is witnessing as well as the work that is coming to the Indian players.

BPO and IT services firms have traditionally hired large number of students from engineering colleges and graduation colleges. But hiring from top B-schools has always been a tad difficult as students prefer to work with sectors like banking, consultancy, and FMCG.

The trend to hire more management graduates is however, not limited to EXL services alone or to the third party BPO sector. Captive BPOs of IT companies are also joining the bandwagon. IT major Tata Consultancy Services (TCS) plans to hire over 1,200 management students for FY11 from B-schools across the nation. Of these the company has already extended offer letters to 557 students. TCS BPO has also made 129 offers so far.

According to Pandia Rajan, Chairman Ma Foi Randstad, this trend is prominent among the third party BPOs which need a strong marketing team. “With higher order processing migrating to India, BPOs these days are operating like any other company. Their growth needs are as important with various departments including marketing and HR growing,” said Rajan.

Similarly, Infosys Technologies has extended 1,000 offers to B-schools students this year. This number is much higher than last years 463. For FY11 Infosys has already visited 57 B-schools.

IT services and KPO firm Syntel agrees with this trend. “We have hired management graduates in the past. With the shift in the industry the talent required in the industry is different. You also have to remember that this sector is people intensive, you need qualified managers. You cannot just blame the students for not being interested in joining this industry. IT services and BPO firms have never interacted with them. With firms now getting aggressive they are finding interest as well,” said Mushtaque Aalam, Global Head, Recruitment, Syntel.

Students from management schools especially from premier institutes draw much higher salary than an engineering student. For instance, at entry level, an average management student would draw between Rs 3.6 lakh and Rs 6 lakh whereas, salary of a management graduate from a premier institute would be over 100 per cent.

Similarly, a fresh engineer graduate gets an entry level salary of Rs 3.3 lakh to Rs 3.5 lakh. Category B management college students draw start salary of Rs 4.6 to 4.7 lakh from the top IT services firm.

“It’s the job profiles student look at rather than looking at the industry. EXL Service offered consulting and general managerial posts to IIM-A graduates which was interesting,” said a placement committee member from IIM-A.

Other than opting for other sectors, management students, especially from tier-1 B-schools, tend to draw very high salaries. “A management student always manages to draw better salary. That also sometimes acts as hurdle for industry players to hire in large numbers as students like higher salary and perks that are generally provided by i-banks and consultancy firms,” said Gupta. Industry experts also point out that the need to hire more management talent is also because of the work that is coming to India. “Whether it is the IT industry or BPO, they have moved on to handle high-end work for clients. For instance, BPO’s are no longer providing only voice work. Large BPO firms are managing processes like accounting, analytics and other core activities. For IT firms, consultancy is becoming core as they move away from application development and maintenance kind of work,” said an industry observer.


Small city hits big league in BPO trade

February 28th, 2011

With only five taxicabs around, you’d be lucky to catch one in Dumaguete City.

Here, people go places in a tricycle, while motorcycles rule the road. For a city measuring 35 square kilometers, this small place, by any standard, still grinds to a halt at noontime to allow everyone to go home for lunch.

“I didn’t believe it at first when they said that in Dumaguete, everything is 10 minutes away. But I found out for myself that it’s true,” says Leonel Joseph “LJ” Lising, senior operations manager of SPI CRM, a business process outsourcing company that had set up shop here in 2009.

“When they say a place is far, it’s actually near. A 10-minute drive could take you to the next town,” according to Lising who hails from Manila.

Dumaguete’s smallness is its own charm. On a typical afternoon, one can find several of its European immigrants hobbling toward their favorite watering hole. There are many such establishments on Rizal Boulevard, which faces Dumaguete bay. There, the immigrants get their favorite fix before they sit back and watch the world go by.

Small wonder why not a few of SPI’s foreign clients have been heard to ask, “Why Dumaguete? There are only 150,000 people there,” recalls Suzanne Lu-Bascara, SPI Global associate director.

The anxiety is not totally misplaced. SPI Global, after all, is a major player in the BPO industry in the country, with 11,000 employees, not to mention some 3,000 more in 24 locations in the United States, Europe, India and Vietnam.

The company’s Dumaguete operation alone expanded from 313 full-time employees in October 2009 to 1,100 employees in January 2011.

“We’re now the biggest private employer in Negros Oriental, doing both voice and nonvoice services,” Bascara says.

The company has made it a point to bring their foreign clients to Dumaguete to see the place, she adds.

“They see that, although the city is small, there is a steady manpower pool generated by the four universities and colleges here, which produce about 5,000 graduates each year, in contrast to the 500,000 graduates throughout the country,” Bascara explains.

Dumaguete is also called a university town. It is home to Silliman University, founded by American missionaries in 1901. Nuns from the order of St. Paul de Chartres set foot on Dumaguete’s shores in 1904 to establish the first campus of St. Paul University in the Philippines.

In 1949, a young teacher named Vicente G. Sinco established what is now the nonsectarian Foundation University, the first Filipino university. The Negros Oriental State University was founded in 2004.

For Lising, these universities and seven other colleges play an important part in providing them quality employees.

“We get nine or 10 walk-ins every day, and we have a success rate of 30 to 40 percent. In contrast, we may get more applicants in Manila, but the success rate is only 10 percent,” Lising says.

Not only do educational institutions provide the 4,000 workers for Dumaguete’s thriving BPO industry, they have also formed an Information Communication Technology (ICT) Council to harmonize the skills of graduates with the demand of the competitive BPO sector.

The outsourcing business is estimated to pump in no less than P34 million a month into the economy of Dumaguete City and Negros Oriental. And that figure is culled from workers’ salaries alone. It does not count the side businesses that the employees support.

“Near our site, some houses have been [turned into] boarding houses,” Lising says. Several restaurants have also sprouted nearby.

Another thing Lising likes about Dumaguete is that workers don’t tend to skip work even if they partied the night before.

“No wonder Dumaguete had been ranked 10th on the list of Next Wave Cities in the Philippines last year,” he says.

SPI Global started operations in Dumaguete with the merger of two companies, E-PLDT Ventus and SPI Technologies, in October 2009. The company’s nonvoice services include publishing and copyediting. It also has a call center that mostly handles the needs of Smart Communications Inc., its sister company.

Bascara says that she and her co-workers are all proud of the quality of their work. Their work ethic won them acclaim in 2009 when the Black Book of Outsourcing cited SPI Global for being the top outsourcing company in the world.

This distinction was based on a poll of about 650 respondents from the global publishing community.

May Dizon, SPI Global director for external affairs and corporate communication, says that the company will soon venture into the more lucrative KPO [knowledge process outsourcing] market, offering content solutions, healthcare and client relationship management.

Also, Dumaguete will be the site of SPI Global’s pioneering venture in the billing and cycle revenue management.

“Dumaguete is a showcase,” Dizon explains. “We want the others to know that, in Dumaguete, we found a good place to grow and expand.”


China grows as IT outsourcing hub

February 28th, 2011

Australia could be the next big target of a Chinese IT outsourcing market expected to generate upwards of US$4.01 billion ($3.97 billion) in revenue this year.

VanceInfo – one of China’s largest outsourcers by market share – launched in Melbourne last October and has already kicked off expansion plans.

With Australia’s oft-touted skills shortage and a resurgence of IT spending, “the conditions are perfect for VanceInfo to grow,” according to its sales and marketing director Trey Zagante.

“There is a growing need in Australia due to the skills shortage, IT spending is forecast to grow in the near future and many large organisations in Australia have experience in outsourcing in some form,” he said.

In 2009, IDC analysts valued the Chinese outsourcing market at US$2.76 billion, almost half of which was generated by European and North American demand.

Gartner analyst Rolf Jester described China as ‘India plus one’, crediting government initiatives for the country’s growth to become the second-largest offshore destination in the Asia Pacific region.

While Australia was “not a big market [for Chinese outsourcing] yet”, a Chinese outsourcer would likely appeal to local outsourcing customers who were looking to diversify, Jester said.

“The Chinese firms are getting better at marketing their skills,” he said. “I think we will see some more of the Chinese providers enter the market.”

In a December 2010 report on regional offshore locations, Gartner graded China “good” or better for its infrastructure, education, labour pool, government support, cultural compatibility and political and economic climate.

But Gartner warned that China’s English language skills, global and legal maturity, and protections of data, intellectual property (IP) and privacy may be sub-par.

“Although China has excellent laws, enforcing them in practice, and policing them is abysmal,” Jester told iTnews.

“You save money on the one hand with much, much lower wage costs. But you have to build into your strategy extra costs of security, management, IP and travel costs.”

Gartner estimated cost savings of 25 to 40 percent from outsourcing big projects or ongoing services to a Chinese firm.

But according to Queenslander Lloyd Ernst, who founded Chinese developer Sinocode in 2004, the availability of cheap Chinese talent has dried up in recent years.

“We no longer do outsourced development work in China,” he told iTnews today. “Although the skills here are very good, the price of white collar labour has slowly climbed up, year on year.”

“It became clear you are not going to make a lot of money here from outsourcing – and I’m here for the opportunity.”

Ernst was now pursuing other business opportunities in China, using Sinocode and its staff to develop and market power management vendor Greentrac.

While Chinese time zones, education and work ethic bode well for outsourced Australian work, potential customers tended to raise security, language and cost concerns, Ernst said.

According to Gartner, Australian companies tended to use local outsourcers, which accounted for an estimated 95 percent of the nation’s US$6.9 billion outsourcing spend.

VanceInfo’s Zagante would not disclose local client identities, naming Citibank, Microsoft and China Telecom among its international customers.

The company’s 12 Australian staff linked local customers with 10,000 Chinese technologists who performed software development and maintenance, business process outsourcing, and R&D services.

But it may be an uphill battle for specialised outsourcers like VanceInfo to win more conservative customers over from giants like IBM and Accenture, which also had Chinese facilities, Gartner’s Jester predicted.

“Clearly, conservative organisations concerned with long-term stability are more comfortable with dealing with multinationals,” Jester said.

“It will take a long time [for Chinese outsourcing providers in Australia] to get on par with India because they have had a very large head start of seven to eight years.”


Why internal IT and Outsourcing cultures clash

February 25th, 2011

Everybody loves a hero, particularly in IT-that talented professional willing to twist himself in knots to please his users and work overtime to get the job done. Most corporate IT organizations actively recruit, reward, and retain those willing to repeatedly save the technological day.

But internal IT organizations wind up paying a high price for that hero culture particularly when they decide to outsource to a third party, says consultants at outsourcing consultancies TPI and Compass Management Consulting (recently acquired by TPI’s parent company). The internal culture inevitably clashes with that of the service provider, which values process discipline, predictability, and consistency. Higher costs and lower productivity often result.

Even those IT organizations that never outsource suffer under a superman regime, say Todd Dreger, partner in TPI’s operational strategy practice and Bob Mathers, principal consultant with Compass. talked to Dreger and Mathers about the origins of the hero IT culture, the value of the rare provider that resists it, and what happens when cultures collide. You say that most corporate IT organizations built around a “hero” culture-one that values responsiveness, commitment to quality service, and individual initiative to solve user problems? Does that culture serve internal IT well?

Todd Dreger, Partner, TPI’s Operational Strategy Practice: Hero cultures usually develop unintentionally. IT organizations of many Fortune 500 companies seek to recruit the top talent. They look for people with ambition, drive and passion for customer service. These individuals tend to serve a very demanding business. This usually requires reacting quickly to issues or requests, staying up all night or working all weekend. Business and IT management often applaud this behavior and reward it with gifts or promotions.

When this approach is successful, the IT people become part of the business team. A negative consequence is that visibility into incidents and problems is often lost as the business contacts staff in IT directly to resolve issues or concerns, rather than working through a process. And guess who they call? The hero. Success and reward are the motivation. Others in IT pattern the behavior. The result is a culture based on heroics.

Managing business user expectations, adhering to process, and proactively managing problems is contradictory to this culture. While the relationships with business may be good from an IT perspective, we often find little alignment to the business. Projects routinely over-run their budgets and schedule, and the business often cites a lack of innovation provided by IT and inflated cost structure or chargebacks. How does that hero culture clash with an IT outsourcer culture? How and when do those clashes tend to play out?


China Telecom to Weigh Outsourcing to Taiwan

February 24th, 2011

China Telecom Chairman and Chief Executive Wang Xiaochu said his company will procure 60 million units of consumer-premise telecom equipment from Taiwan this year, a 33% increase from 2010`s 45 million units.

Wang is leading a trade mission to visit Taiwan. His company is currently the No.1 fixed-line and No.3 mobile telecom carrier in mainland China, offering fixed-line service to 175 million subscribers and mobile service to 90.52 million subscribers throughout the mainland.

He said major products on the company`s procurement list include mobile phones and tablet PCs. Besides the procurements, the company will enhance cooperation with Taiwan Semiconductor Manufacturing Co. (TSMC), HTC Corp. and VIA Telecom Inc., according to Wang.

People familiar with the cooperation deals pointed out that Wang`s company has to rely on Taiwan`s manufacturers to help it achieve the goal of increasing its CDMA mobile subscribers to over 100 million by the end of this year by supplying CDMA-2000 mobile phones, chips and LAN equipment.

Wang will confer with TSMC Chairman and Chief Executive Morris Chang, HTC Chairperson Cher Wang, and Kinpo Electronics Inc. Chairman Rock Hsu over cooperation. Also, he will visit Chunghwa Telecom Co., Ltd., Taiwan Mobile Corp., Far EasTone Telecom Co., Ltd., Asia Pacific Telecom Co., Ltd., Vibo Telecom Co., Ltd., Inventec Corp., Wistron Neweb Corp., MediaTek Inc., Gemtek Technology Co., Ltd., Microelectronics Technology Inc., and ZyXEL Communications Corp.

Wang said the mainland`s telecom market is very huge and his company is pushing to promote 3.5G service in the mainland, luring Taiwan`s manufacturers to work with it to develop the mainland market.


Nagarro Named “Rising Star” in 2011 Global Outsourcing 100® List

February 24th, 2011

projects, today announced that for the second consecutive year, it has been named to the 2011 Global Outsourcing 100® List by the International Association of Outsourcing Professionals’® (IAOP®). Nagarro is ranked as one of 25 “Rising Stars” recognized by the listing, reinforcing the company’s reputation as top global provider of business-critical outsourced software development services.

The IAOP is in its sixth year of compiling its annual ranking of the world’s best outsourcing service providers, The Global Outsourcing 100. The Global Outsourcing 100 and its sub-lists are essential references for companies seeking new and expanded relationships with the best outsourcing firms in the industry. The lists include companies from around the world that provide the full spectrum of outsourcing. The rankings are based on applications received and evaluated by an independent judging panel organized by the IAOP.


“Nagarro is proud to be named to the Global Outsourcing 100 list once again. Nagarro’s tremendous growth over the past year has been fueled by our tireless dedication to customer satisfaction, which is underscored by this award.” — Vikas Sehgal, CEO, Nagarro Inc.

“Revenue data supplied by applicants for the Global Outsourcing 100 shows the size and strength of the outsourcing industry. Outsourcing is enjoying strong growth and companies are outsourcing more of their operations than ever before.” — Michael Corbett, IAOP Chairman and chair of judges’ panel


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