By Michael Overly, Matt Karlyn and Julie Kim, CIO
The focus, at all levels of government, on economic recovery and job growth has spurred proposed state and federal legislation that takes aim at offshore outsourcing.
For example, four proposals pending in Congress would define new rules for how companies use outsourcers. Three focus on offshore call centers, while a fourth would discourage offshoring by ending various tax benefits received by companies doing business overseas. Meanwhile, state lawmakers have proposed prohibiting companies that send business out of state or offshore from receiving government contracts and other financial benefits.
While none of the bills seem likely to become law soon, CIOs considering outsourcing business operations such as call centers should anticipate the affect that this type of legislation could have on the costs of outsourcing and include provisions in their outsourcing agreements to address the potential impact.
Source:http://www.networkworld.com/news/2010/091310-offshoring-reduce-risk-when-govt.html?page=3
This story appeared on Network World at
http://www.networkworld.com/news/2010/091310-offshoring-reduce-risk-when-govt.html
Tuesday, September 14, 2010
Capgemini Survey Reveals Latin America is the Third Most Popular Outsourcing Destination
Executives rank Latin America as attractive outsourcing location based on low-cost, skilled labor; technology and infrastructure capabilities; and economic stability
NEW YORK--(BUSINESS WIRE)--Capgemini, one of the world’s foremost providers of consulting, technology and outsourcing services, today announced the results of the second annual Capgemini Executive Outsourcing Survey, which found that Latin America1 is the third most popular outsourcing destination, with 25 percent of responding companies currently outsourcing to this region. While still perceived by many respondents to be an “emerging” outsourcing destination, this survey revealed that Latin America is not far behind legacy outsourcing destination China, which is ranked second at 27 percent, while India leads with 60 percent of companies outsourcing to this country.
“As the economy rebounds, companies are looking to use outsourcing more strategically as a tool to increase efficiency, yield significant cost savings and drive growth; this includes considering locations beyond India”
The survey, commissioned by Capgemini and conducted online by Harris Interactive, among 300 senior executives at Fortune 1000 companies also identified the top reasons for executives to select Latin America as part of their outsourcing strategy. More than two-thirds (69 percent) of surveyed executives cited cost of labor as the top reason why their company might outsource to Latin America, while other attributes reported included technology and infrastructure capabilities (49 percent), skilled labor (48 percent), and economic stability (44 percent). These attributes are aligned with the key reasons why companies choose to outsource in general suggesting that outsourcing to Latin America will continue to expand.
Other reasons cited as important for selecting Latin America for outsourcing include its proximity to the U.S., time zone alignment and accent neutrality. These attributes are all unique to this region when compared to other outsourcing locations such as China and India.
The Executive Outsourcing Survey findings also revealed that almost half (45 percent) of executives who do not currently outsource to Latin America say their company would be interested in considering the region as a resource for outsourcing in the future.
In addition to uncovering Latin America as a leading outsourcing destination, the survey highlighted the region’s increasing value to the global economy. An overwhelming majority of executives (89 percent) believe that Latin America is an emerging market that will become increasingly important to U.S. businesses, and that there are advantages to doing business in Latin America (83 percent). Further, more than half (56 percent) of executives believe doing business in Latin America is becoming easier than doing business in other parts of the world.
“As the economy rebounds, companies are looking to use outsourcing more strategically as a tool to increase efficiency, yield significant cost savings and drive growth; this includes considering locations beyond India,” said David Poole, Vice President and Head of Americas Business Process Outsourcing, Capgemini. “The expansion of Capgemini’s outsourcing services in Latin America, and our work with Unilever, Coca-Cola Enterprises and other clients in the region underscores our understanding of our clients’ needs and ability to provide the right global delivery model for multinational businesses.”
Other survey highlights include:
The top five factors listed by executives in choosing an outsourcing destination are labor costs (79 percent), technology & infrastructure capabilities (62 percent), skilled labor (61 percent), language proficiency (49 percent) and economic stability (44 percent);
Less important factors listed by executives in choosing an outsourcing location are tax benefits (26 percent) and proximity to the U.S. (3 percent);
Forty-one percent of executives outsourcing to Latin America cited language proficiency as a key reason;
Forty percent of executives cited the average education of the Latin American workforce as a key factor in their decision to outsource in Latin America.
Capgemini’s Business Process Outsourcing organization applies unique business insight, business intelligence tools and deep domain knowledge to help clients transform business operations. As part of its global delivery model, Capgemini has eight outsourcing centers throughout Latin America, including Argentina, Brazil, Chile and Guatemala.
Source: http://www.businesswire.com/news/home/20100913007526/en
NEW YORK--(BUSINESS WIRE)--Capgemini, one of the world’s foremost providers of consulting, technology and outsourcing services, today announced the results of the second annual Capgemini Executive Outsourcing Survey, which found that Latin America1 is the third most popular outsourcing destination, with 25 percent of responding companies currently outsourcing to this region. While still perceived by many respondents to be an “emerging” outsourcing destination, this survey revealed that Latin America is not far behind legacy outsourcing destination China, which is ranked second at 27 percent, while India leads with 60 percent of companies outsourcing to this country.
“As the economy rebounds, companies are looking to use outsourcing more strategically as a tool to increase efficiency, yield significant cost savings and drive growth; this includes considering locations beyond India”
The survey, commissioned by Capgemini and conducted online by Harris Interactive, among 300 senior executives at Fortune 1000 companies also identified the top reasons for executives to select Latin America as part of their outsourcing strategy. More than two-thirds (69 percent) of surveyed executives cited cost of labor as the top reason why their company might outsource to Latin America, while other attributes reported included technology and infrastructure capabilities (49 percent), skilled labor (48 percent), and economic stability (44 percent). These attributes are aligned with the key reasons why companies choose to outsource in general suggesting that outsourcing to Latin America will continue to expand.
Other reasons cited as important for selecting Latin America for outsourcing include its proximity to the U.S., time zone alignment and accent neutrality. These attributes are all unique to this region when compared to other outsourcing locations such as China and India.
The Executive Outsourcing Survey findings also revealed that almost half (45 percent) of executives who do not currently outsource to Latin America say their company would be interested in considering the region as a resource for outsourcing in the future.
In addition to uncovering Latin America as a leading outsourcing destination, the survey highlighted the region’s increasing value to the global economy. An overwhelming majority of executives (89 percent) believe that Latin America is an emerging market that will become increasingly important to U.S. businesses, and that there are advantages to doing business in Latin America (83 percent). Further, more than half (56 percent) of executives believe doing business in Latin America is becoming easier than doing business in other parts of the world.
“As the economy rebounds, companies are looking to use outsourcing more strategically as a tool to increase efficiency, yield significant cost savings and drive growth; this includes considering locations beyond India,” said David Poole, Vice President and Head of Americas Business Process Outsourcing, Capgemini. “The expansion of Capgemini’s outsourcing services in Latin America, and our work with Unilever, Coca-Cola Enterprises and other clients in the region underscores our understanding of our clients’ needs and ability to provide the right global delivery model for multinational businesses.”
Other survey highlights include:
The top five factors listed by executives in choosing an outsourcing destination are labor costs (79 percent), technology & infrastructure capabilities (62 percent), skilled labor (61 percent), language proficiency (49 percent) and economic stability (44 percent);
Less important factors listed by executives in choosing an outsourcing location are tax benefits (26 percent) and proximity to the U.S. (3 percent);
Forty-one percent of executives outsourcing to Latin America cited language proficiency as a key reason;
Forty percent of executives cited the average education of the Latin American workforce as a key factor in their decision to outsource in Latin America.
Capgemini’s Business Process Outsourcing organization applies unique business insight, business intelligence tools and deep domain knowledge to help clients transform business operations. As part of its global delivery model, Capgemini has eight outsourcing centers throughout Latin America, including Argentina, Brazil, Chile and Guatemala.
Source: http://www.businesswire.com/news/home/20100913007526/en
Outsourcing ban will impact nation: Rosaiah (Andhra CM)
Andhra Pradesh’s IT hub is getting the jitters after America’s Ohio state decided to ban outsourcing to India. Hyderabad, now the biggest IT hub in the country for government IT and back-office projects, has more than 2,000 software companies dependent on outsourcing from the US and Europe.
While the IT industry is guarded in its response, Chief Minister K Rosaiah has expressed concern saying that it would impact IT industry not only in the state but in the whole country.
Rosaiah had a lengthy discussion about the possible impact of the ban on the state with Advisor, Information Technology, Andhra Pradesh government, C S Rao.
“A majority of the world’s top 500 companies outsource work to India, and a major part of it comes to Hyderabad. The Ohio ban is just the beginning. The US government is likely to cut incentives to companies outsourcing IT projects to India and more states and companies may decide against outsourcing. It would become difficult for the IT industry to survive here if outsourcing is banned,” Rosaiah said.
Source: http://www.indianexpress.com/news/Outsourcing-ban-will-impact-nation--Rosaiah/680828
While the IT industry is guarded in its response, Chief Minister K Rosaiah has expressed concern saying that it would impact IT industry not only in the state but in the whole country.
Rosaiah had a lengthy discussion about the possible impact of the ban on the state with Advisor, Information Technology, Andhra Pradesh government, C S Rao.
“A majority of the world’s top 500 companies outsource work to India, and a major part of it comes to Hyderabad. The Ohio ban is just the beginning. The US government is likely to cut incentives to companies outsourcing IT projects to India and more states and companies may decide against outsourcing. It would become difficult for the IT industry to survive here if outsourcing is banned,” Rosaiah said.
Source: http://www.indianexpress.com/news/Outsourcing-ban-will-impact-nation--Rosaiah/680828
Monday, September 13, 2010
Infosys BPO to hire 550, to double investment in Poland
By PTI
Infosys BPO is set to increase the total headcount of its Poland operations to 1,500 in next one year.
"The company currently employees 950 people, atleast in next twelve months, we should get to a level of around 1,500," Infosys BPO CEO and Managing Director and Dandapani Swaminathan told PTI.
Besides, the company would double the investment in the region (Poland) over the next two years. Swaminathan expects to 'double the investment in the region (Poland) over the next two years, taking base level around $10 million.'
On the issue of attrition, Swaminathan added that at the place like Poland these are manageable.
Asking on the ban by the Ohio government on outsourcing of government IT projects outside the United States he said, 'its not only about shifting jobs its also about driving efficiency. This will be even out as we move forward.'
In the medium to the long term, industry will find solutions to ensure that it will be pain free for everyone.
These are all policies, which keeps on coming in the Asia Pacific and European regions. These issues can have a short term impact in one region and may have a short term spurt in another region, he added.
Source: http://www.siliconindia.com/shownews/Infosys_BPO_to_hire_550_to_double_investment_in_Poland-nid-71533-cid-3.html
Infosys BPO is set to increase the total headcount of its Poland operations to 1,500 in next one year.
"The company currently employees 950 people, atleast in next twelve months, we should get to a level of around 1,500," Infosys BPO CEO and Managing Director and Dandapani Swaminathan told PTI.
Besides, the company would double the investment in the region (Poland) over the next two years. Swaminathan expects to 'double the investment in the region (Poland) over the next two years, taking base level around $10 million.'
On the issue of attrition, Swaminathan added that at the place like Poland these are manageable.
Asking on the ban by the Ohio government on outsourcing of government IT projects outside the United States he said, 'its not only about shifting jobs its also about driving efficiency. This will be even out as we move forward.'
In the medium to the long term, industry will find solutions to ensure that it will be pain free for everyone.
These are all policies, which keeps on coming in the Asia Pacific and European regions. These issues can have a short term impact in one region and may have a short term spurt in another region, he added.
Source: http://www.siliconindia.com/shownews/Infosys_BPO_to_hire_550_to_double_investment_in_Poland-nid-71533-cid-3.html
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