IT Outsourcing India

With the current financial climate causing businesses to continue to look for ways of keeping costs down, there has never been a better time to consider the benefits of outsourcing IT.

Many businesses keep IT in-house, overlooking the numerous advantages that external IT support providers can bring to a company.

While big firms can afford to maintain large teams of in-house IT experts, the same cannot be said for SMEs, who often have just one or two IT staff. But these smaller companies could reap rewards by utilising the manpower and expertise of specialist IT support companies.

The most obvious benefit of using an external provider is cost. A survey published in Computer Weekly in May found that the average salary for an IT professional is £34,217.

But if a company engages an external IT support provider, they can secure a comprehensive service at a fraction of that sum.

There are many other benefits of using external IT support specialists. If an SME employs one IT specialist, that person can only complete one task at a time. Specialist IT support providers, however, have whole teams that can service a company’s IT needs at any time.

And what happens if two IT systems, fundamental to the operation of a business – for example, a stock ordering system and an e-mail system – go down at the same time? Any downtime costs a company money. If a business has one in-house IT specialist available, each problem must be dealt with in turn.

However, if a business has a contract with an external provider, they have access to a whole team of experts who can work simultaneously to quickly get the systems up and running. In this way, external IT support providers help businesses maintain productivity and benefit their bottom line.

Moreover, permanent staff take holidays, and will inevitably take days off sick. External IT providers will always have staff available whenever they are needed. Again this helps to reduce downtime, improve productivity and ultimately saves companies money.

The credit crunch is really making businesses focus on being as efficient as they can possibly be. Maintaining efficiency during tough times is the key to success. There are many advantages to outsourcing IT that businesses should consider. There is clearly a cost saving in terms of salaries and pensions, as having in-house staff is expensive.

There are also efficiency savings, as external IT support companies are extremely responsive, often available 24 hours a day, seven days a week and are likely to offer a broader range of expertise than that offered by one person.

While it is always important for companies to seek efficiencies, the current economic climate is making it ever more important for businesses to work smarter.

Using external IT support providers is one way of working smarter, as it will have a positive impact on a company’s bottom line.”

* Andy Dillon is managing director, VeriLan Technologies

Source : http://www.birminghampost.net/

Indian outsourcing companies are likely to be affected by the economic downturn in the US, an Indian trade body has warned

The National Association of Software and Service Companies (Nasscom) said on Tuesday that the continuing "turmoil" in the US financial markets would be likely to have a negative effect on Indian business process outsourcing (BPO) contracts, in the short term.

"The Indian IT-BPO sector is an integral part of the global ecosystem and is likely to be impacted in the short-term (two to three quarters), as clients become cautious in their discretionary spending and decision-making cycles get extended," said Nasscom in a statement.

The trade body added that events such as the $85m (£46m) bail-out of AIG by the Federal Reserve Bank had already had an impact on spending in the US financial services industry.

"The US financial market has been in unprecedented turmoil in the past few days witnessing bankruptcy, mega-takeover and US government bail-out of an insurance company," said Nasscom. "This turmoil has directly impacted spending in the US financial sector and is likely to create a downstream impact on other sectors of the US economy and worldwide markets."

 The National Association of Software and Service Companies (Nasscom) said on Tuesday that the continuing "turmoil" in the US financial markets would be likely to have a negative effect on Indian business process outsourcing (BPO) contracts, in the short term.

"The Indian IT-BPO sector is an integral part of the global ecosystem and is likely to be impacted in the short-term (two to three quarters), as clients become cautious in their discretionary spending and decision-making cycles get extended," said Nasscom in a statement.

The trade body added that events such as the $85m (£46m) bail-out of AIG by the Federal Reserve Bank had already had an impact on spending in the US financial services industry.

"The US financial market has been in unprecedented turmoil in the past few days witnessing bankruptcy, mega-takeover and US government bail-out of an insurance company," said Nasscom. "This turmoil has directly impacted spending in the US financial sector and is likely to create a downstream impact on other sectors of the US economy and worldwide markets."

Nasscom did not comment on what it was expecting from the UK and Europe, apart from saying that the effects on Indian BPO clients in the rest of the world remained to be seen.

"Over the next few weeks/months we will get a better assessment of the impact on sectors other than financial and also their influence in geographies other than [the] US," the trade body said.

However, there are mitigating factors to the situation, Nasscom said. The sub-prime lending debacle has forced the financial services industry to put measures in place to try to limit economic damage, said the trade body.

"Since the sub-prime crisis began, last year, the industry has focused extensively on improved utilisation, enhanced productivity and business transformation," said Nasscom, which predicted that the Indian BPO industry would "tread the period ahead with caution and take measured steps."

By contrast, the nascent black IT economy, where criminals use business models similar to the legitimate economy, is increasing in the region, security company Symantec has warned. Speaking to The Hindu Business Line on Thursday, Shantanu Ghosh, vice president of India product operations for Symantec, said that criminal outsourcing activity was becoming more "mature".

"Phishers and spammers have supply-chain managements too, and there are clear prices for the services that each one provides and all these are beginning to show up now," Ghosh was quoted as saying. "This has made the underground economy more mature with flexible models and for a new person entering this area he no longer needs to [be] a specialist, but can buy the services."

Source : http://news.zdnet.co.uk/ 

IBM India has entered into USD 450million IT outsourcing contract with private insurance player Max New York Life MNYL. The technology services behemoth, which has already showcased the advantage of total IT outsourcing with the telecom major Bharti, is expecting this deal to pan out in the similar manner.

The deal, spread over ten years, will see IBM India providing complete endtoend backend IT infrastructure to MNYL. IBM India global technology services vicepresident Nipun Mehrotra said, “This life insurance is a growing market and the work we have done has the potential to change the sector.It is likely to change in similar lines to what happened in telecom sector.”

According to IRDA, the market for insurance both life and nonlife in 2006 2007 stood at USD41.74 billion, with the life insurance market growing at 47.38 percent while the nonlife business rose by 21.51 percent. It is estimated that life insurance market alone is expected to touch USD80 billion in the next couple of years.

Life insurance premium collections including single premium, first year and renewal in 200607 stood at Rs 1.56 lakh crore representing a yearon year growth of 47.38 percent. IRDA statistics indicates that the Indian insurance market accounts for a paltry 1.12 percent of the global insurance market estimated to be at USD3,723 billion.

Mr Mehrotra said as part of the agreement, MNYL will see them getting revenue for every insurance policy sold. This, in fact, reaffirms the commitment of IBM as it would also making substantial investments in setting up the IT infrastructure as part of the deal.

The key aspect of the deal will be to extend the reach of the insurance player and focus on the semiurban and rural areas. IBM India said that they will be bringing in technology process which will enable MNYL provide life insurance policies with minimum documentation.

Mr Mehrotra said their focus would be on delivering high efficiency at lower costs. As the alliance is still in its early phase, there is a sharp focus on bringing the best of the breed IT applications and services.

Source : http://www.offshoringtimes.com/

Fuelled by the dearth of ICT skills in the South African market, outsourcing continues to gain momentum. A maturing industry, it has a number of best practices, like service and operating level agreements (SLAs and OLAs), that provide companies with some assurance that outsource service providers will meet agreed objectives. A more important question for many companies, however, is whether the outsourcer can be trusted at a more intrinsic level, to keep the best interests of the company in mind, delivering real business value.

Says Jaroslav Cerny, Managing Director of RDB Consulting, a company that offers professional database and operating system support, consulting, project management, solutions architecture and more: "Trust is an important component of any outsourcing agreement, but its one that can only be built over time. There are, however, a few practical considerations that will assist companies to choose an outsourcing partner that can and will deliver a solution that adds value to the organisation.

"Chief among these are an assessment of the experience and expertise of the outsourcing company and resources it allocates to the project; the company’s track record; the commitment of its management in terms of participating in, and overseeing the project; the effort the company makes to understand your business and processes; and its ability to introduce constant improvement."

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