Transcript IT Outsourcing

Dhruv Patel
Bill Hays
Cindy Steinmetz
Will Isom
Lindsey Bryan
What is IT Outsourcing?
“… is using outside vendor to create, maintain, or engineer IT
architectures and systems …”
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Originally started as a big trend for major companies to hire out side firms to
handle and mange their IT departments
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Why kept in house
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Capital availability
Engineering know how
Tailored to fit
Why outsourced
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Cost
Know how increased in the market place
Lot of success with mass production
Almost Like
Natural Evolution
What is IT Outsourcing
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Currently the big deal is “Offshore” outsourcing
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IT jobs moving outside the country
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Using firms outside the country for IT needs
Companies opening their own IT departments in different countries to handle IT
needs
“Offshore” and “Outsourcing” have become synonymous
Involves all aspects of IT not just some
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Development
Implementation
Maintenance/monitoring
Housing
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Physical hardware being there
No remote maintenance (dialing in)
What are the jobs involved?
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Mostly all aspects of IT
Due to nature of jobs
Some limitations
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Hardware troubleshooting
Solution housing hardware offshore as well
Bandwidth increases breaking limitations
How big is the phenomenon?
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IT is big money
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Now think about cutting costs
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Lot of money put into IT
Latest way to improve business productivity
In most cases cost vs. benefit ratio high
Cost cut 15%-60%
No loss of quality
Put both together big deal from business point of view
Expected to grow by 6% annually till end of decade
Why is IT outsourcing growing?
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IT still relatively new
New applications discovered everyday
Implementation costs keep going down
Technological innovations breaking down
barriers
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Bandwidth
Global Infrastructure stability
Predictions 10 Years Ago
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Growth not expected
IT thought too volatile to trust to others
Importance not emphasized
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Not integrated into business
Potential limited due to technology
Education not thought to be present
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Global education lacking
Current Trends
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Save money
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Relocate to where costs are lower
Integrate education as much as possible
Political effects due to job market
Automation
Security concerns
Future Predictions
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Continue to grow until the end of the decade
Predicted of peak then
 Growth will still continue, but not at the current rate
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Slow down
IT will be incorporated pretty well in almost every
aspect of business by then
 Job/economical equilibrium will be reached
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Global Effect
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Biggest player is Asia
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Others
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India
Philippines
New comer Dubai
Ireland
Israel
Canada
South Africa
Biggest by far is India
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Growing rapidly
8% of GDP
Political reform
Educational reform
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Starts in elementary school
Highly based on English
Abundance of educated labor capital
Global Effect
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Infrastructure planned around IT
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Skilled labor
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Cities wired
High speed lines coming in on the eastern coast
Flawless integration into city planning
Government control helps planning to benefit economy
Large supply
Highly educated
Very competitive keeps prices low
Criticized
 Low class programmers
 Creativity limited
 Great for coding
Top five IT firms in Asia all in India
National Effect
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Major panic
Loosing jobs
Yes loosing jobs, but because industry growing so
rapidly
 New jobs created daily
 Job still stays within borders
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National Effect
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Education ramping up
IT education High School
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CISCO certification
MCSE certification
Still lagging behind
Political tussling
IT not affected that much
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Nature of business no physical exchange
Trade of information and intellectual capital
Questions