Outsourcing

"Findings published by Info-Tech Research Group, a global IT research organisation, show that businesses can save an average of 27 per cent if they outsource their IT infrastructure to specialists.

"...analysis found 73% of software firms have witnessed a rise in
profits since they offshored, while all respondents claimed to be
meeting 80% to 100% of their cost saving goals.

Although the financial expectations were met, hopes of efficiency

"During my recent visit to Moscow... one theme emerged time and again: Russian software developers are talented, hardworking and opinionated. In contrast, Indian software developers are talented, hardworking and not so opinionated."

Full article: Russia Navigates a Bumpy Road to Outsourcing Future.

"There's negativity building in onshore versus offshore. We see more people terminating onshore deals in order to put things offshore. Offshore providers are seen as more attractive because they can increasingly boast certifications, such as CMMI, to go with their significantly lower costs."

Full article: Study: Outsourcing Boom Is Over

Some stats from the study:
47 percent of buyers prematurely terminated at least one outsourcing relationship in the prior 12 months.

• 28 percent of buyers terminated at least one offshore deal

Here are some figures that will help calm worries that outsourcing causes job losses. The Office of National Statistics research indicates that:

• Employment in the UK IT industry has grown 8.8 percent since 2002;
• Overall UK employment growth in the same period was only 3.2 percent;
• UK is a net exporter of IT-enabled services.

Furthermore, according a British Computing Society report, updated in May 2006, "global sourcing will be a competitive differentiator."

Computing, (2006). Shifting Sands. Computing, 15 June, p.41.

"What does it mean when your CMM level 5 outsourcing partner sends you junk?
I had a chance to catch up with a former colleague over Nine-dollar Martinis at the Wooden Iron in Wayne the other day. And before we were engulfed in a mob of Main Line real estate professionals, he shared his current outsourcing frustration with me."

CMM Level 5 - So What!

Quarter 1 2006: 86 contracts valued at over £12.5bn
Quarter 1 2005: 76 deals valued at over £9bn

Computing, (2006). Record Number of Outsourcing Deals. Computing, 27 April, p.18.

UK firms will lead offshore outsourcing growth. Number of companies offshoring will rise from 13 to 20 percent in the next two years.

Kelly, L., (2006). UK drives further outsourcing growth. Computing, 27 April, p.6.