IT Outsourcing India

The IT industry of West Bengal remains apprehensive about the impact of the Citu-sponsored industrial strike on August 20.

Most employees of IT companies operating from Sector V in Kolkata’s Salt Lake, the hub of BPO and IT companies in Kolkata, have been asked to come into office by 6am on August 20 and stay back overnight or till the strike is lifted.

BPOs and call centres, on the other hand, have made arrangements for employees to stay back after work tonight and leave only tomorrow after work.

Sector V houses some 300 IT companies. A few of the companies, which may not work or employees who may not turn up on Wedensday, will make up for it by working through Saturday and Sunday.

The state IT department, too, has not taken any measure to help employees reach their offices safely. Earlier, the department would issue stickers marked ‘essential services’ to the IT companies and vehicles that ferried employees.

But the department decided not to issue such stickers after some vehicles carrying the stickers were damaged by bandh mongers.

According to Debesh Das, IT minister of the state, people who do not wish to participate in the bandh will not be prevented. “Police and security arrangements of Sector V will be looked into by the administration and we are sure that no untoward incident will occur.”

It may be recalled that about a dozen party cadres heckled an IT employee, damaged the vehicle, which was ferrying the person home, and thrashed its driver for daring to venture out on a Left Front-sponsored bandh in June this year.

According to a spokesperson of Cognizant, "We have asked our employees who want to turn up on Wednesday to send request emails on Tuesday to the administration department. The department will organise cars to ferry employees before 6am on August 20. The employees will have to stay overnight or till the strike is lifted. The employees who will not make it on Wednesday will have to make up for it during the weekend."

Kalyan Kar, MD of Acclaris, said, "The state should not let bandhs affect the IT industry as we manage international clients who do not understand this concept of bandh."

According to Som Mittal, president of Nasscom, while the IT industry recognised the right of political parties to call bandhs or strikes, IT companies in turn expected politicians to understand the 24x7 nature of their business and compulsions of client deadlines.

Clearly, although the IT and ITeS sectors have been classified under ‘public utility services’ operating 24X7, the reality is far from this.

Source : http://www.business-standard.com/

BANGALORE: Europe has been heralded as the next big stop for the Indian IT outsourcing industry. But, with incremental revenue steadily declining in the last four quarters for majority of the Indian IT services majors, there has been a visible slowdown from this continent.

A look at the quarter-on-quarter incremental revenue growth for the top six India-based IT services majors—TCS, Infosys, Wipro, Satyam, HCL and Cognizant—reveals an uneven growth with some showing a sharp drop. Only Cognizant managed to almost recoup revenue addition to the levels of one year ago.

In the case of TCS, for the quarter ended September 30, 2007, the revenue from Europe stood at $400.6 million showing QoQ revenue addition of $26.1 million, but by June 30, 2008, the increment dropped to $9.3 million.

Similarly for Infosys, there was a decline in the revenue from Europe at the end of June 30, 2008 quarter. For Wipro, revenue addition at the end of September 30, 2007 was $29 million, but by June 30, 2008, it was $7.6 million. In the case of Cognizant, for quarter ending September 30, 2007, the revenue addition was $18.4 million and by the end of June 2008, it stood at $17.8 million.

This, however, does not diminish the year-on-year growth rates reported by these majors, as all the six have recorded between 20% and 83% with TCS being at the lower end and Cognizant at the upper. European corporations may have been late adopters of offshoring but they have shown a gradual increase in the large deals (ABN Amro) as also new verticals (processing services, retail, health insurance). In fact, this region may have come as a buffer for most large IT services companies, who are currently facing a bit of a slowdown in discretionary spends from the US companies.

Source : http://economictimes.indiatimes.com/ 

CHENNAI: Despite the global economic slowdown and bad publicity against the industry, India’s outsourcing sector would retain its high growth rate, says R. Chandrasekaran, president of Cognizant India, a leading global and business process outsourcing (BPO) company. The number of foreign companies outsourcing jobs to India is increasing geometrically, the industry leader said in an interview.

According to him, lower salaries, compared to the global standards, is the unique selling proposition (USP) of India. However, he added: "On the global GDP linked purchase power parity grid, India is the fourth country ahead of Germany, the UK, Italy, Canada etc, according to the listings of the International Monetary Fund (IMF) and the World Bank. Doesn’t that indicate something?" Chandrasekaran also expressed confidence that India would catch up with the global pace in the IT industry and technological advancement.

"From mobile telephony that helps us keep track of vehicles that ferry our associates from home to jobs, to application of RFID (Radio Frequency Identification), Nano and virtualisation methods, all in their infancy globally, our research is on a par with the world," he said.

Asked about the computer hardware prices, he said prices would come down further in two years as all "aspects of life will depend on computing per se" by that time. While he pointed out the crippling shortage of electricity in the country and particularly in Tamil Nadu, where Cognizant has units, Chandrasekaran said: "No matter what the world says, we are happy here. Further, shortages in some form or other are a global phenomenon."

Despite humble beginnings from a Tamil medium school, Chandrasekaran has built an empire whose last balance sheet showed an annual profit of $2.13 billion. Cognizant is the second company in India to have been accorded the honour of ringing the Nasdaq (US stock exchange) bell for the start of trade March 5, 2007. "In 2006, we grew 60 per cent but the rising rupee, the global slowdown and competition have trimmed it almost by half. Yet, our profits are close to $2.8 billion and we are India’s fastest growing services company in IT," Chandrasekaran said.

Asked about the company’s efforts to reverse brain drain, Chandrasekaran said he was one of those who started the process successfully. "Roughly 70 per cent of our top people are the best examples of reverse brain drain," he said.

Chandrasekaran said Cognizant was against making too many attractive offers to students before graduation as these result in dropouts.

"We invest in R&D in educational institutions, rewarding faculties for cutting-edge results and encourage systems of education like technical writing, content management, e-learning to prepare students for the future. Our collaborative ventures in Manipal have resulted in a new course in pharmacological methods," he said.

Asked about bad publicity against the IT industry, he said: "While our strict controls, sensitisation methods, constant monitoring have prevented any wrongdoing, some sections of the media play up minor aberrations as it’s fashionable to titillate underachievers by blaming the smartest guys and girls of India."

Source : http://economictimes.indiatimes.com/

Egypt is the latest in a long line of countries to set up a government agency to sell its IT services to businesses overseas.Countries such as the Philippines, Russia and Kenya have sent out similar delegations, envious of the spectacular overhaul of Indias economy in the past 10 years, led by technology investment.Amin Khaireldin, a board member of Egypts Information Technology Industry Development Agency, said the country has learned from Indias example.

We studied India carefully and learned two things ­ we need to focus on our talent pool keeping supply ahead of demand, and we need to have a reliable infrastructure, he said. Khaireldin insists Egypt has done both these things.

The government has approached universities, and along with industry help designed an IT curriculum that it hopes will train 40,000 graduates a year over three years.

Significant infrastructure investments, along with the construction of a technology village near Cairo, have attracted the likes of Orange, Vodafone and Alcatel to outsource business processes there.

Internal IT infrastructure investment has grown from USD4bn GBP2bn to USD12bn GBP6bn in the past three years, in part because a strong rupee and rising labour costs in India have led costcutting outsourcers to look elsewhere.

A McKinsey study found that Egypt was the 13th best outsourcing destination globally, and on average 14 per cent cheaper than India.

As well as trying to attract outside investment, the Egyptian government is encouraging internal innovation.

The government has cut corporation tax from 42 per cent to 20 per cent and begun customs reforms to improve trade.

And a competition prize offering three startups a year USD 50,000 GBP 25,000 and free resources has led to a number of innovative new firms.

Raya, an Egyptian startup that began converting voicemails into text then moved into IT services, was launched in 1998 and recently floated on the Cairo stock exchange for about GBP180m.

Stephen Page, chief executive of hardware manufacturer Sapphire, said he has been happy with his companys recent outsourced operations in Egypt.

It has good value, good workers and not too much red tape, he said. We have found the infrastructure is at least as reliable as in India.

But Mark KobayashiHillary, director of the National Outsourcing Association, said there was no noticeable trend of UK companies going to Egypt yet.

They paint a rosy picture but what they have to offer in terms of value and infrastructure is similar to many other countries around the world, he said.

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