IT Projects: Expert Witness, CIO, In-House Counsel & Litigation Forum

Seven IT Tips for surviving the recession

Author:  Cath Jennings        Originally posted on 1/13/09 at:     http://www.computerweekly.com/Articles/2009/01/13/authors/articleauthor.aspx?liArticleID=234171

The global recession and how to cope with it will inevitably dictate the business and IT agendas during 2009. While the general consensus is that IT budgets are likely to remain relatively flat overall, circumstances will vary from industry to industry, with sectors such as financial services and travel being hardest hit. Government and utilities will see investment remain relatively buoyant.

Gartner indicates that, although 46% of CIOs believe their budget will increase, 21% expect expenditure to fall and a further 33% anticipate that there will be no change. Mark McDonald, global vice president of executive programmes at Gartner, says: "Some companies are going through large budget declines, while increases are very modest, which is holding the overall number down."

Nonetheless, many IT organisations are already shelving nice-to-have, discretionary projects and getting rid of costly on-site contractors, while at the same time adopting a somewhat longer-term, wait-and-see approach.

Outsourcing vendor ACS to move 'higher-level' IT jobs offshore

How are U.S. companies reaching the determination that the resources in the offshore areas have acquired the necessary level of expertise to fill management and application development roles?  Isn’t there a great risk here, to be compared to the fairy tale where the two “ugly stepsisters” are attempting to jam their size 10’s into Cinderella’s size 5 glass slipper, in order to win the grand prize, the hand of Prince Charming in marriage?  If they actually do it by force, they will probably be too crippled to walk down the aisle with the Prince!  Have American companies done in-depth studies on the level of offshore skills available, to be certain that they will not cripple their businesses in the long run with staffing that is unable to “fit” the job?  This development has all the makings of a "fractured fairy tale".  We would like to have your insights and comments on this issue.                            Marlene

Originally appeared on 2008-11-03 posted by Patrick Thibodeau Obama touts desire to keep tech jobs in the U.S.

• Offshore Coders: Cheaper and Better
• People: The New IT Priority
• Bailout won't keep Wall Street from sending jobs offshore
• Salary comparison

http://www.computerworld.com/action/article.do?command=viewArticleBasic&taxonomyName=Outsourcing&articleId=9118938&taxonomyId=72&pageNumber=1

Execs say firm plans to start offshoring development, project management work

November 3, 2008 (Computerworld) IT workers and managers who believe their jobs are at too high a level to be sent overseas may want to look at Affiliated Computer Services Inc.'s plan to boost its offshore outsourcing operations by moving "more complex, higher paying" jobs to countries outside the U.S.

Dallas-based ACS, which provides IT and business process outsourcing services to a wide range of corporate and government clients, currently employs about 63,000 people, 20,000 of them in low-cost offshore locations. But in a conference call last Thursday on its financial results for the quarter that ended Sept. 30, ACS detailed plans to increase the number of employees working offshore by 4,200 during its current fiscal year, which began July. (A transcript of the call can be read on Seeking Alpha Ltd.'s Web site.)

"To have a greater financial impact, we will be moving a higher percentage of more complex, higher paying jobs offshore, including management and application development roles," ACS President and CEO Lynn Blodgett said during the call.

ACS has been gradually shifting jobs to offshore and near-shore centers in the Philippines, Jamaica, Guatemala and India. In its 2006 fiscal year, just under 25% of the company's workforce was based outside of the U.S. Now, nearly 35% of its workers are overseas, according to a presentation used by ACS officials during the conference call.

Tom Burlin, chief operating officer at ACS, filled in some of the details about the jobs that will be affected by the additional offshore moves. "We've done a great job in moving base production-level jobs offshore but have decided," he said, "to aggressively move more of our higher level jobs, like production managers, higher-level back-office functions and higher-level development roles, to lower-cost locations."

The company said the expected savings from offshoring will give ACS more money to invest in areas such as sales, innovation and development of new products. "This is the right thing to do and the right time to do it," Blodgett said. "This investment will make us stronger, not only during this economic storm, but for years to come."

Top 10 Hidden Costs of Outsourcing

Once again, to avoid unnecessary pitfalls and unpleasant surprises that wreck havoc with a project's budget, one of the most important items that will need to be well thought out, and well-drafted--the contract!  Does anybody see any important issues that might not have been covered in this article?  Please comment and fill us in on any missing pieces.    Marlene

By David Brown <http://www.cioinsight.com/cp/bio/David-Brown/>

2008-09-09

Businesses often make avoidable mistakes in crafting and executing their outsourcing plans. Here’s a list of typical pitfalls and how your company can avoid them.

 

When it comes to outsourcing, there’s more to your business case than the service provider’s price. Some outsourcing costs are less visible or downright  hidden. EquaTerra …, an outsourcing consultancy, reviews the top 10 hidden costs and how to avoid them.

 

Hidden Cost No. 1: Currency

Problem: Because of currency fluctuations, last year’s invoice of $1

million a month could be $1.4 million today.

 

Solution: Hedge the currency risk by including caps and collars in the

contract. For example, you and your service provider might agree to

share responsibility for currency adjustments up to a certain dollar

amount, beyond which you’ll go back to the table and renegotiate. By

hedging the risk in this way, many domestic companies protected

themselves against the devaluation of the U.S. dollar.

7 Sins of Offshore Outsourcing

Some interesting points made here about the pitfalls of short-term cost reductions, and as with all projects, the need for due diligence.  Have any of you experienced such an initiative - and how did you fare with it?  Let us know your stories.    Marlene

Originally posted on 2008-09-02 by Geraldine Fox and Nigel Hughes at http://www.baselinemag.com/c/a/Outsourcing/7-Sins-of-Offshoreoutsourcing/?kc=BLBLBEMNL09032008STR3

The mistakes organizations make when implementing and managing offshore and outsourcing initiatives can be understood in the context of the seven deadly sins. Offshore outsourcing, offshore development and moving jobs offshore can have significant cost reductions when adopting a fix and mix approach. This involves an analysis and improvement of operations prior to offshoring (fix), followed by a movement of specific functions offshore where appropriate (mix). 

Offshoring business operations offers the potential for cost savings of 15 percent to 20 percent, but Compass analysis show that organizations that properly plan and operate offshore initiatives can reap substantially higher rewards.

Organizations that focus on short-term cost reductions often rush through projects without adequate planning, due diligence or consideration of the long-term implications of the inevitable changes in business requirements or offshore market conditions. In many respects, the mistakes organizations make when implementing and managing offshore initiatives can be understood in the context of the seven deadly sins: pride, sloth, avarice, lust/extravagance, envy, gluttony and anger.