BENGALURU: After nearly two decades of outsourcing back-office software projects to Indian IT firms such as Infosys and Wipro<\/a>, some global corporates such as US retailer Lowe’s are now bringing back software projects to their own centres, potentially depriving homegrown software exporters of millions of dollars of business. 班加罗尔:经过近二十年的后台软件项目外包给印度IT公司Infosys和等Wipro一些全球企业,如美国零售商劳氏现在恢复软件项目自己的中心,可能剥夺了国产软件出口商的数百万美元的生意。
\n
\nIn an exclusive interview with ET, Lowe’s chief information officer Paul D Ramsay said the company was completely revamping its traditional outsourcing strategy and would start shifting a lot of its software development and maintenance into its own centres.
\n
\n“We traditionally have used a lot of third parties in Bangalore. And part of our Bangalore play is to insource back our capabilities into our GIC (global in-house centre) in Bangalore,” Ramsay told ET.
\n
\n“Our strategy is to insource core capability, core functionality in the US and also here in Bangalore. And has that impacted our third parties? Absolutely.”
\n
\n![\"\"](\"\/\/www.iser-br.com\/Themes\/Release\/images\/responsive\/ettelecom-default.jpg\")
\n
\nHe said Lowe’s is changing its strategy around third parties and vendors. Now, the firm will work with fewer third-party vendors and partners who will focus on some niche activities.
\n
Lowe’s, which spends more than a billion dollars annually on IT, currently has outsourcing contracts with Infosys, Wipro and USbased Cognizant<\/a>, according to industry<\/a> executives.
\n
\nRamsay declined to comment on specific vendor companies that Lowe’s works with. “I also think some of the promises around outsourcing have not truly been realised. We all have our outsourcing stories of initiatives that went well and those that did not go so well,” said Ramsay.
\n
\n“I think there are a lot of strategic advantages to insourcing, around talent, around focus that I think you struggle against sometimes from an outsourced situation. A lot of the outsourcing activity is very much commoditised. In the same way, that there is no money in selling hardware anymore.”
\n
Executives at India’s largest software firms would be hoping that Ramsay and Lowe’s insourcing strategy fails, so that they can renew dialogues for fresh business. In a year in which global IT spending is expected to drop by as much as 5.5%, according to technology researcher Gartner<\/a>, and amid rising concerns of a slowdown in China triggering a global meltdown, customers cutting back on bread-and-butter outsourcing is the last thing India’s $146-billion IT industry needs.
\n
To be sure, their top customers such as Citigroup<\/a>, General Electric<\/a> and Bank of America<\/a> are still spending hundreds of millions of dollars on outsourcing to India. And that demand will not evaporate overnight, experts say.
\n
\n“The discussion on insourcing is a bit like Groundhog Day: it keeps popping up time and again. It is not a secular trend suggesting a shift away from outsourcing. However, for mature organisations, insourcing offers an additional instrument in the sourcing tool box,” said Thomas Reuner, managing director at US-based HfS Research.
\n
But Lowe’s is not the only company rethinking its outsourcing strategy. According to executives familiar with discussions, Indian firms’ top outsourcing customers such as AIG, AstraZeneca and Deutsche Bank<\/a> have also insourced back some of their software development projects into their captive centres in India.
\n
\nThe most famous example of insourcing was provided by General Motors in 2010 when the company’s CIO Randall D Mott reversed the automaker’s outsourcing policy and announced that 90% of its IT would be handled by in-house staff over 3-5 years.
\n
Earlier this year, in an interview with WSJ, AstraZeneca’s technology chief David Smoley had said that the company would slash its annual outsourcing spend of $750 million by half over the next two years, with the company betting big on cloud computing<\/a> and reducing its need for physical technology infrastructure, local networks<\/a> and computers.
\n
\nAstraZeneca did not respond to a detailed email questionnaire seeking comment as of press time Tuesday. AIG and Deutsche Bank declined to comment for this story.
\n
\n“Key factors to insourcing are: 1. Build vs buy. CIO’s who like to take back application development. Those who have app dev skills often want to have more flexible capabilities,” said Ray Wang, founder of Silicon Valley-based research firm Constellation Research. “2. Strategic vs commodity. Political shifts on strategic requirements. More strategic, more likely they want more control. 3. Renewal versus new. Stabilisation of existing environment. Once they have found a way to keep environments in play, they usually explore new stuff on their own vs work with a partner.”
\n
\nIndian IT's traditional business model faces a significant threat of disruption if this trend gathers momentum, amid the advent of automation which is already starting to make the insourcingoutsourcing debate irrelevant.\n\n<\/p><\/body>","next_sibling":[{"msid":48678773,"title":"Broadband growth largely happening in rural areas: Airtel's Ajay Puri","entity_type":"ARTICLE","link":"\/news\/industry\/broadband-growth-largely-happening-in-rural-areas-airtels-ajay-puri\/48678773","category_name":null,"category_name_seo":"industry"}],"related_content":[],"msid":48678793,"entity_type":"ARTICLE","title":"Indian IT companies face the threat of losing out on the lucrative outsourcing segment","synopsis":"Some global corporates are now bringing back software projects to their own centres, depriving desi IT cos of millions of dollars of business.","titleseo":"industry\/indian-it-companies-face-the-threat-of-losing-out-on-the-lucrative-outsourcing-segment","status":"ACTIVE","authors":[{"author_name":"Anirban Sen","author_link":"\/author\/479240111\/anirban-sen","author_image":"https:\/\/etimg.etb2bimg.com\/authorthumb\/479240111.cms?width=100&height=100","author_additional":{"thumbsize":false,"msid":479240111,"author_name":"Anirban Sen","author_seo_name":"anirban-sen","designation":"Correspondent","agency":false}}],"Alttitle":{"minfo":""},"artag":"ET Bureau","artdate":"2015-08-26 11:36:51","lastupd":"2015-08-26 11:37:47","breadcrumbTags":["industry","Wipro","Gartner","Cognizant","Citigroup","Bank of America","Networks","Deutsche Bank","Cloud computing","General Electric"],"secinfo":{"seolocation":"industry\/indian-it-companies-face-the-threat-of-losing-out-on-the-lucrative-outsourcing-segment"}}" data-authors="[" anirban sen"]" data-category-name="Industry" data-category_id="18" data-date="2015-08-26" data-index="article_1">
在一次独家采访中,劳氏首席信息官保罗D拉姆齐说,公司完全是改造传统的外包策略,会改变很多的软件开发和维护自己的中心。
“我们传统上使用了大量的第三方在班加罗尔。和我们班加罗尔的一部分是我们生产能力进入我们的新加坡政府投资公司(全球内部中心)在班加罗尔,”拉姆齐告诉等。
“我们的策略是生产核心能力、核心功能还在美国和在班加罗尔。并且影响我们的第三方?绝对。”
他说劳氏改变其策略第三方和供应商。现在,该公司将与更少的第三方供应商和合作伙伴将专注于一些特别的活动。
劳氏,每年花费超过十亿美元,目前外包合同和印孚瑟斯,Wipro和cnn认识到,根据行业高管。
拉姆齐拒绝评论具体供应商劳氏公司使用。“我也认为一些承诺的外包并没有真正意识到。我们都有我们的外包计划顺利的故事和那些没有这么好,”拉姆齐说。
“我认为有很多内销战略优势,在人才,围绕重点,我认为你斗争有时从一个外包的情况。大量的外包活动很商品化。以同样的方式,在销售硬件,没有钱了。”
印度最大的软件公司的高管将希望拉姆齐和劳氏内销战略失败,这样他们就可以更新为新的业务对话。在过去一年里,全球IT支出预计将下降5.5%,根据技术研究Gartner,在中国经济放缓的担忧日益增长,引发了全球危机,客户减少实用的外包是印度1460亿美元的行业需要的最后一件事。
可以肯定的是,他们的顶级客户,如花旗集团(Citigroup),通用电气(General Electric)和美国银行(Bank of America)仍然花费数亿美元在外包到印度。需求不会在一夜之间消失,专家说。
“讨论内包有点像土拨鼠日:它使一次又一次地出现。它不是一个长期趋势暗示从外包转移。然而,对于成熟的组织,内包提供了一个额外的仪器采购工具盒,“董事总经理托马斯•重新聚会表示美国HfS中研究。
但劳氏并非唯一一家反思其外包战略。据熟悉讨论高管,印度公司的外包客户如美国国际集团(AIG),阿斯利康和德意志银行(Deutsche Bank)也生产了一些他们的软件开发项目到他们俘虏中心在印度。
内包的最著名的例子是提供的通用汽车(General Motors)在2010年该公司的CIO兰德尔·D·莫特扭转公司的外包政策,宣布的90%是由内部员工3 - 5年。
今年早些时候,在《华尔街日报》的采访中,阿斯利康的技术主管David Smoley曾表示,公司将削减一半的年度外包花7.5亿美元在未来两年内,公司上下了很大的赌注云计算和减少其需要物理技术基础设施,当地网络和电脑。
阿斯利康没有回应记者的置评详细的电子邮件问卷调查周二新闻时间。美国国际集团(AIG)和德意志银行(Deutsche Bank)拒绝置评。
“内包的关键因素是:1。构建还是购买。CIO的那些喜欢拿回应用程序开发。那些应用程序开发技能往往希望有更灵活的功能,”硅谷的研究公司的创始人Ray Wang说星座研究。“2。战略与商品。的政治转变战略的要求。更多的战略,更有可能的是他们想要更多的控制。3所示。更新和新。 Stabilisation of existing environment. Once they have found a way to keep environments in play, they usually explore new stuff on their own vs work with a partner.”
印度的传统商业模式面临重大威胁破坏如果这一趋势加快,在自动化的出现已经开始使insourcingoutsourcing辩论无关紧要。
BENGALURU: After nearly two decades of outsourcing back-office software projects to Indian IT firms such as Infosys and Wipro<\/a>, some global corporates such as US retailer Lowe’s are now bringing back software projects to their own centres, potentially depriving homegrown software exporters of millions of dollars of business.
\n
\nIn an exclusive interview with ET, Lowe’s chief information officer Paul D Ramsay said the company was completely revamping its traditional outsourcing strategy and would start shifting a lot of its software development and maintenance into its own centres.
\n
\n“We traditionally have used a lot of third parties in Bangalore. And part of our Bangalore play is to insource back our capabilities into our GIC (global in-house centre) in Bangalore,” Ramsay told ET.
\n
\n“Our strategy is to insource core capability, core functionality in the US and also here in Bangalore. And has that impacted our third parties? Absolutely.”
\n
\n
\n
\nHe said Lowe’s is changing its strategy around third parties and vendors. Now, the firm will work with fewer third-party vendors and partners who will focus on some niche activities.
\n
Lowe’s, which spends more than a billion dollars annually on IT, currently has outsourcing contracts with Infosys, Wipro and USbased Cognizant<\/a>, according to industry<\/a> executives.
\n
\nRamsay declined to comment on specific vendor companies that Lowe’s works with. “I also think some of the promises around outsourcing have not truly been realised. We all have our outsourcing stories of initiatives that went well and those that did not go so well,” said Ramsay.
\n
\n“I think there are a lot of strategic advantages to insourcing, around talent, around focus that I think you struggle against sometimes from an outsourced situation. A lot of the outsourcing activity is very much commoditised. In the same way, that there is no money in selling hardware anymore.”
\n
Executives at India’s largest software firms would be hoping that Ramsay and Lowe’s insourcing strategy fails, so that they can renew dialogues for fresh business. In a year in which global IT spending is expected to drop by as much as 5.5%, according to technology researcher Gartner<\/a>, and amid rising concerns of a slowdown in China triggering a global meltdown, customers cutting back on bread-and-butter outsourcing is the last thing India’s $146-billion IT industry needs.
\n
To be sure, their top customers such as Citigroup<\/a>, General Electric<\/a> and Bank of America<\/a> are still spending hundreds of millions of dollars on outsourcing to India. And that demand will not evaporate overnight, experts say.
\n
\n“The discussion on insourcing is a bit like Groundhog Day: it keeps popping up time and again. It is not a secular trend suggesting a shift away from outsourcing. However, for mature organisations, insourcing offers an additional instrument in the sourcing tool box,” said Thomas Reuner, managing director at US-based HfS Research.
\n
But Lowe’s is not the only company rethinking its outsourcing strategy. According to executives familiar with discussions, Indian firms’ top outsourcing customers such as AIG, AstraZeneca and Deutsche Bank<\/a> have also insourced back some of their software development projects into their captive centres in India.
\n
\nThe most famous example of insourcing was provided by General Motors in 2010 when the company’s CIO Randall D Mott reversed the automaker’s outsourcing policy and announced that 90% of its IT would be handled by in-house staff over 3-5 years.
\n
Earlier this year, in an interview with WSJ, AstraZeneca’s technology chief David Smoley had said that the company would slash its annual outsourcing spend of $750 million by half over the next two years, with the company betting big on cloud computing<\/a> and reducing its need for physical technology infrastructure, local networks<\/a> and computers.
\n
\nAstraZeneca did not respond to a detailed email questionnaire seeking comment as of press time Tuesday. AIG and Deutsche Bank declined to comment for this story.
\n
\n“Key factors to insourcing are: 1. Build vs buy. CIO’s who like to take back application development. Those who have app dev skills often want to have more flexible capabilities,” said Ray Wang, founder of Silicon Valley-based research firm Constellation Research. “2. Strategic vs commodity. Political shifts on strategic requirements. More strategic, more likely they want more control. 3. Renewal versus new. Stabilisation of existing environment. Once they have found a way to keep environments in play, they usually explore new stuff on their own vs work with a partner.”
\n
\nIndian IT's traditional business model faces a significant threat of disruption if this trend gathers momentum, amid the advent of automation which is already starting to make the insourcingoutsourcing debate irrelevant.\n\n<\/p><\/body>","next_sibling":[{"msid":48678773,"title":"Broadband growth largely happening in rural areas: Airtel's Ajay Puri","entity_type":"ARTICLE","link":"\/news\/industry\/broadband-growth-largely-happening-in-rural-areas-airtels-ajay-puri\/48678773","category_name":null,"category_name_seo":"industry"}],"related_content":[],"msid":48678793,"entity_type":"ARTICLE","title":"Indian IT companies face the threat of losing out on the lucrative outsourcing segment","synopsis":"Some global corporates are now bringing back software projects to their own centres, depriving desi IT cos of millions of dollars of business.","titleseo":"industry\/indian-it-companies-face-the-threat-of-losing-out-on-the-lucrative-outsourcing-segment","status":"ACTIVE","authors":[{"author_name":"Anirban Sen","author_link":"\/author\/479240111\/anirban-sen","author_image":"https:\/\/etimg.etb2bimg.com\/authorthumb\/479240111.cms?width=100&height=100","author_additional":{"thumbsize":false,"msid":479240111,"author_name":"Anirban Sen","author_seo_name":"anirban-sen","designation":"Correspondent","agency":false}}],"Alttitle":{"minfo":""},"artag":"ET Bureau","artdate":"2015-08-26 11:36:51","lastupd":"2015-08-26 11:37:47","breadcrumbTags":["industry","Wipro","Gartner","Cognizant","Citigroup","Bank of America","Networks","Deutsche Bank","Cloud computing","General Electric"],"secinfo":{"seolocation":"industry\/indian-it-companies-face-the-threat-of-losing-out-on-the-lucrative-outsourcing-segment"}}" data-news_link="//www.iser-br.com/news/industry/indian-it-companies-face-the-threat-of-losing-out-on-the-lucrative-outsourcing-segment/48678793">
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