Ever on the pulse of the breaking news and trends within the outsourcing industry, the sourcingfocus.com Round-Up has emerged this week from the eternally engaging Financial Times (FT). According to an FT article, the IT outsourcing landscape is due for a radical re-shuffle. It seems that we could be due to enter a new phase, with vendors such as Google, Microsoft and Amazon offering uncomplicated services on a per-person per-month, or even per-transaction, basis. Jonathan Cooper-Bagnall, head of PA Consulting, was quoted in the paper maintaining that, in the past “outsourcing contracts were inflexible, with fixed baselines.” He went on to assert that “the next wave of contracts will go beyond that to include virtual services, such as Google Apps or e-mail.”
So I guess outsourcing giants such as Infosys and Wipro will need to adapt to keep up with the emerging American outsourcing market. Let’s hope they are up to the challenge.
Another area of interest in the IT outsourcing sphere has come in the unlikely form of Scotland. There has been a move by a number of organisations to position Scotland as a rival to Eastern Europe as the UK’s primary near-shore outsourcing destination and even take business from the established Asian players. Organisations including the Trade Association for Technology in Scotland, the Scottish Development International and the Chartered Institute for Bankers in Scotland recently met to discuss how English firms can be encouraged to outsource processes such as software development to Scotland, rather than locations such as India.
Can they do it? One wonders if the Highlands can ever truly compete with Hyderabad where IT is concerned. Watch this space and we’ll keep you updated on the progress.
So, what other big news has hit sourcingfocus.com’s virtual printing press this week? Well, Unisys has been awarded a five-year multi-million dollar extension to its IT outsourcing contract with Landis+Gyr. The services provided by Unisys under the contract extension include; round-the-clock system management and SAP operations, virtualisation and consolidation of IT technologies and international service desk outsourcing.
However, it is a bitter sweet win for the US technology firm, as Monday saw them announce that they were cutting 1,300 jobs as part of a series of cost-savings moves aimed at saving over 225 million dollars a year.
The US Army also caught sourcingfocus.com’s radar this week for far less controversial reasons than those covered in the national press recently. They have awarded CSC a $226m task order. Under the terms of the task order, CSC will provide a broad range of support services, including project and technical management; research, design and development; systems engineering; and training. CSC will support a range of projects at various locations worldwide, such as the United States, Iraq, Afghanistan, Kuwait, Germany and Korea.
And finally more news from our neighbours across the pond; Starbucks has signed a CRM contract with Convergys Corporation. The deal is a two-year extension of an existing contract. To the bewilderment of the sourcingfocus.com team and many readers no boubt, the release, from Convergys claimed that it was due to their rapid growth that their internal contact center could no longer provide cost-effective and efficient facilities to its stores in North America. One just has to wonder if this is the same company whose reported profits have fallen 7.6 percent in the second quarter – a conundrum indeed.
And that perplexing note brings us to the end of this week’s Round-Up. we will keep our collective ears to the ground on Scotland’s progress with its campaign to reign as the UK’s near-shore IT outsourcing destination. I don’t know about you, but I fancy their chances…