2008 Archive

Harvey Nash's outsourcing and offshoring division is now "beating some really serious players at their own game." Those aren't my words. They belong to technology industry analyst Anthony Miller in this blog entry inspired by Harvey Nash's newly minted $65 million deal with Alcatel-Lucent.

Talking to IT leaders over the past several years, I often heard recurring concerns about driving down costs and increasing efficiency. And why not? IT needs to operate as effectively as any area of the business. But today, as the economy continues its steep downturn, we have gone far beyond a tough quarter or tightening the belt. These are extraordinarily tough times presenting once-in-a-lifetime scale challenges for businesses, their leaders and the workforce.

Outsourcing and offshoring can sometimes get a bum rap in the marketplace, especially when the economy is in turmoil. Why shouldn't opportunities stay local rather than being "shipped overseas?" Is long distance a hindrance rather than a value?

Well, it looks like I have some very formidable competition when it comes to doling out offshoring insights. Geraldine Fox and Nigel Hughes of Compass share this fantastic piece on "The Seven Sins of Offshore Outsourcing" this month in Baseline Magazine. Aligning the common mistakes companies make when they offshore to the Seven Deadly Sins, the two authors and business executives have developed an excellent guide for how to avoid major offshore outsourcing pitfalls.

Quality is of utmost importance in every industry. And quality of work and the level of talent are even more scrutinized when the work is done offshore. Afterall, offshoring is still a fairly new concept for many companies leery to send work overseas for fear that quality will suffer.

You can't feel bad for the Indian offshore market. The country has defined and led the global IT offshore industry for more than 10 years. Since the beginning of this decade, India's IT and outsourcing companies have seen record growth and profitability.

I recently went to the World BPO Forum where one of the discussion topics in the Outsourcing 2.0 session was quite provocative: Should you do an RFP or not when selecting an outsourcing vendor? There were two distinct perspectives:

On the "What Is Noise" blog, David Fisher contemplates personal outsourcing in a post called "Outsourcing My Life." He looks at chores like laundry, housecleaning and even researches and considers whether it is more beneficial to hire out these traditionally personal tasks or do them himself.

While Vietnamese Prime Minister Nguyen Tan Dung was here in the U.S. to discuss issues like trade, the environment and inflation, I was making my very first visit to Ho Chi Minh City. I have spent lots of time in Hanoi in recent years and was very excited to get to know a new Vietnamese city.

Fuel costs more. Food costs more. Travel costs more. And not just here. Prices are going up around the world, from the U.S. to China to India. This week The New York Times focused on a business bargain that I, and the rest of us here at Harvey Nash, have been talking to you about for years now. The article "Investors Seek Asian Options to Costly China" by Keith Bradsher takes a look at Vietnam, the location of Harvey Nash's offshore development centers. The piece focuses on the fact that many businesses are expanding their Asian bases outside of China and a great many of them are choosing Vietnam as their next location.

Insights and Findings from the Recent CIO Forum and Executive IT Summit in Hartford, CT

As far as I'm concerned, the buck stops here. Hiring, training, motivating and retaining talent is the ticket to success. Of course there are many factors that play into the success of a business -- but really it boils down to hiring top talent and keeping them. Turnover does nothing for a company's bottom-line, so securing a solid team, and then motivating them to excel, is where it's at.

Denver Market Above Average - How Does Your Market Compare?

Traveling around the country to share results and solicit feedback from the Harvey Nash 2007/08 CIO Survey has been interesting to say the least. I am getting comments about all angles of the survey, some surprising and some what I would expect. Together with CSIA, Colorado's Technology Association and KPMG, Harvey Nash hosted a CIO Forum in Denver last week. There I had the opportunity to talk with a group of senior IT executives, including John Heveran from Level 3 Communications, Michael "Mike" Casullo from WildBlue Communications, Jim Lubinski from Western Union and Micki Nelson from MWH Global about the results of Harvey Nash's national survey and how they compare to the Denver market. Here are a few interesting key points that I walked away with:

The concept of integration is one with which most who work in technology are familiar. It's the IT and business integration buzz that continues to present challenges for IT organizations. And ironically, it's a partnership that has proven to be critical for success in today's business world.

There's a lot of discussion in the outsourcing arena about the challenges of hiring, and more importantly, retaining talent. In fact, I was recently reading an article talking about these challenges and the rising turnover rates. There are statistics floating around that say some areas of India are experiencing turnover rates greater than 50 percent and that some U.S. companies have lost their entire India-based team in less than a year. While a 50 percent turnover rate is a bit high -- the 20 percent range that we're starting to see in China is becoming more common. Harvey Nash is experiencing turnover rates around five percent in Vietnam which is remarkably low for the outsourcing business.

I am convinced that the people of Hanoi are among the most innovative bunch around. What I like about Vietnam today is the simplicity with which they make a great impact. Take the following quote from an article that appeared in the Seattle Times titled, "Who Needs Paris When We Have Hanoi?":

It's amazing to me that Vietnam has grown so much in such a short time. This country continues to impress the world with its great economic, technological and business growth. Technology giant IBM agrees, as proven by their decision to create a banking center of excellence in Hanoi.

Xin Ciao (that's hello in Vietnamese),

I just got back from a week-long journey to Vietnam, and as always I return feeling invigorated and motivated to talk about how much this country has grown economically and technically. I have visited Vietnam approximately nine times over the last three years and witnessed so much growth -- some good and some bad.

Only a few weeks into 2008, and the offshoring business community is buzzing. What's everyone talking about? One of my favorite offshore destinations: Vietnam. Now that Vietnam is ranked among the word's top 12 offshore destinations, the press can't seem to get enough of this rapidly advancing IT and business hub.

I thought this article on e-Commerce Times did a good job of outlining several of the emerging trends in outsourcing. However, while the article predicts that 2008 will be the year outsourcing becomes "mainstream" for businesses, I believe that time has passed, especially in terms of IT outsourcing.