Outsourcing: The future looks bright

My last blog mentioned my disappointment at finding there was no Brazil representation at the annual NASSCOM conference in India, but I did not mention any of the more general conference outcomes. This is bullet-point list of what I found being focused on by the general conference audience in Mumbai *View more articles by Mark Kobayashi-Hillary The role of the CIO is shifting to one of IT governance and guidance, rather than procurement and the design of systems. The decisions over which systems to use will be taken directly by the business. This is something we can already see very clearly in areas such as CRM, where the business is already taking most decisions about the software and systems they want to use. There is optimism about the future growth of the outsourcing pipeline. The Indian industry grew 23 per cent last year, suggesting that the green shoots of recovery they talked about a year ago have become a reality. It’s natural for the IT firms to talk positively when they see you are recording the conversation, but this year it seems they have sales to prove things are getting better. Cloud is now a major delivery platform being used by several companies to deliver real services - it's no longer a concept on a PowerPoint deck. This applies both to companies offering remote infrastructure as well as those hosting services and platforms using cloud-based systems. The industry is maturing - particularly the Indian companies - to the extent that clients are asking many suppliers for advice, rather than just executing project after project. This points to the suppliers being more genuine partners, helping to define strategy, rather than just reacting to RFPs. I think the interesting aspect of this is just how inter-related some of the key changes in the industry really are. The supplier community is really shifting to offering cloud-based services and building platform-based solutions rather than just bespoke coding. All of this simplifies the process of procuring their services and allows their sales pitch to be entirely focused on the business management, rather than the IT teams. Anyone working in BPO knows that the business heads have always been the decision-makers, but that is only just starting to apply in IT. We may well see a complete redefinition of the CIO role in the next few years, as this becomes a more prevalent trend. I was surprised that the crisis in Egypt was hardly mentioned at all. Obviously it could not have been on the formal agenda as the news from Tunisia and Egypt had only just started arriving in the days before the event, but I would have expected a lot more informal chatter on this. In particular, how all the major analysts had been recommending Egypt as one of the best places in the world to outsource your back office, just weeks before the government there turned off the Internet, plunging the nation into the electronic equivalent of the Middle Ages. I spoke to the Scottish academic, and contact centre expert, Professor Philip Taylor about the crisis in Egypt and whether those of us in the outsourcing community have just forgotten about assessing political risk when going offshore. You can view our conversation here... So, in general, the news from India is positive. The sourcing industry is on the rebound and genuinely growing again after a barren couple of years. The industry is quite profoundly changing, but this is the sign of a market finally maturing after infancy marked by hyper-growth. There are many interesting years ahead in this market.

Outsourcing: The future looks bright

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