I heard recently that Barclays Bank is going to bring its IT Application Development in-house after deciding not to renew its £400m IT Outsourcing Agreement with Accenture.
This means that some 230 staff who moved to Accenture as part of the original outsourcing deal struck in 2004 are now on their way back to Barclays. I understand that the reasons for Barclay’s refusal to renew the contract were “entirely commercial”. However, it is important to note that this in source decision comes on the back of a strategic review of Barclays and the adoption of the best model to support their strategic needs going forward. This perhaps suggests something wider was taken into consideration when deciding not to continue their IT outsourcing partnership with Accenture.
I have to say IT insourcing seems to be a more common trend these days. Only recently Prudential insourced it’s IT development back from Cap Gemini. However, one thing seems to be a common thread to all these insourcing arrangements is the reasons for doing so are always vague and benign to all involved.
Posted by Kevin Brady on Thu 5th February 2009 at 11:26 PM, Filed in Outsourcing
Business is always looking for new ways to accomplish more for less money. One strategy that can help achieve this is outsourcing as much work as possible to skilled, but cost-effective external offshore providers.
Over the years my outsourcing experience has brought me face to face with many outsourcing clients who have successfully outsourced projects as diverse as business process outsourcing, and general software design and development.
When I talk to clients who have mastered the art of effectively managing external service providers, the same themes emerge over and over again. I’ve distilled their advice into the following “Top 10 Best Practices” for working with external service providers. Following this advice can help you get the most out of your relationships with external vendors or contractors.
Posted by Kevin Brady on Mon 26th January 2009 at 12:19 AM, Filed in Outsourcing
Last week I was asked to do some telephone consultancy for a US research agency and the subject was “The Risks of Indian Software Development Outsourcing”. Their client was a venture capitalist very keen to understand whether this kind of outsourcing so popular in recent years is still in the ascendancy or likely to decline in the future.
My current view is that the market is on the turn and this started before the “Credit Crunch”. I have heard that a couple of the major Indian Outsourcers are now securing fewer and fewer large scale software development contracts.
Whether you believe these rumors or not the following list of Pros and Cons of Offshore Software Development should help you consolidate your opinion one way or the other.
I have just come back from a trip to Bangalore India having been asked to set-up for a well known consultancy an offshore software development centre.
Bangalore was selected because there is already a significant offshore IT development presence by companies such as Accenture, Honeywell Bull, Intel, IBM. It was decided that here I would pull together resource in order to set-up a 200 to 300 man software development factory.
Posted by Kevin Brady on Sun 10th December 2006 at 11:12 AM, Filed in Outsourcing
So what do we mean by the term Offshoring for the Newbie Project Manager?
“It is the relocation of business processes to a lower cost location, usually overseas”.
In theory this looks an almost “too good to be true” opportunity to increase profits through reduced production costs via the exploitation of cheap foreign labour. The expectation with respect to IT software development is a promise of cost reductions in the region of 30% to 40%. The management consultants convince clients that all you needed to do in order to encapsulate this cost saving into your balance sheet, is to carry out, with their help, an IT staff change-over similar to changing out an old car engine and replacing it with a new one made in India or China. Make this happen and “he presto you’re in the money”.