IT Outsourcing India

LONDON: Outsourcing its finance function to India has helped a UK-based software provider company to register a profit this year.

Eg Solutions, a financial service software company based in Staffordshire, has announced that it has recorded a pre-tax profits of 56,000 pounds in the six months to the end of July, compared to a loss of 810,000 pounds in the preceding half year.

The turnaround came in spite of an eight per cent fall in sales from 2.27 million pounds in the first half of 2008 to 2.09 million pounds.

"The really pleasing thing is returning to profit. A lot of it is down to cost-cutting. Outsourcing our finance function to India has saved about 200,000 pounds a year, and it has gone very well," Chief executive Elizabeth Gooch said.

The company, which produces software designed to improve efficiency and employee performance at financial services providers, had around 60 people a few years ago. Now, after outsourcing its finance department it has 37 employees.

The company has ruled out further expansion overseas, despite seeing a 125 per cent sales increase in South Africa over the period.

"We will focus on consolidating and getting back to growth so hopefully we will be able to start paying our shareholders a dividend on their investment," she said.

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

BANGALORE : Most of human resource outsourcing (HRO) contracts coming up for renewal are likely to witness a significant restructuring .This shift is likely to see more such work being offshored to India.

Everest Group, in a study ‘Human Resources Outsourcing (HRO): End-of-Term Market in HRO’ said the areas of restructuring range from modifying the number and type of in-scope processes, to enhancing delivery models through global sourcing, to introducing alternative pricing models.

According to the research firm, about 75-85 % of engagements will likely be extended while 15-25 % will be repatriated or transferred to new suppliers. More than 111 HRO contracts, with a combined total contract value of about $6 billion, are nearing their term end in 2010-12 . Everest analysts foresee scope for reduction with largemarket buyers, whereas midmarket buyers will likely expand narrow scopes and leverage expanded supplier offerings that include talent management services.

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Bangalore: Following the economic slowdown every industry has suffered, for Indian outsourcing firms particularly it has meant lower pays and more competition. For Indian engineers with two to five years of experience, the past 12 months actually saw them lose nearly seven percent of their income. The competition that the Indian outsourcing industry faces has also intensified.

The national average raise, according to a survey by IDC, the market intelligence firm, was about 1.4 percent, with most of the salary gains going to those with the most experience. This is a huge change from the boom years of Indian outsourcing, when wages rose regularly by double digits. They increased 18 percent in 2007-08 alone, and close to 30 percent per year for the five previous years, reports BusinessWeek.

The 2010 fiscal year, which ends in March, will be the first time the industry’s top players will see a revenue decline, according to their own predictions. Infosys expects a 3.1 percent decline in revenue to about $4.5 billion and Wipro expects revenues for the quarter ended Sept. 30 to drop to $1.05 billion from $1.11 billion a year earlier.

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Mphasis, a leading applications services, remote infrastructure services and business process outsourcing service provider, today announced that it will change its branding identity to become Mphasis an HP Company.

Mphasis continues to operate as an independent subsidiary of HP with its own board of directors. The company has seen stellar growth in its revenue with the growth of its business from HP as well as direct customers.

During the third quarter of fiscal year 2009. The Mphasis group, consolidated revenue was at Rs 1,105.6 crores and operating profit up by 132.8 per cent year on year.

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