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Welcome to the March 2005 issue of Offshore Insights!
The concept of global sourcing started in the late 1980s when technology firms
such as IBM, Motorola, Hewlett Packard, Burroughs Corporation and others
discovered Ireland and India as untapped sources of high tech professionals at
substantially lower labor costs. To leverage the labor arbitrage, they built
Captive Offshore Development Centers that effectively took charge of their
development jobs in these offshore locations. Following the same strategy,
Information Technology (IT) departments of Fortune 500 companies began off
shoring low level IT work such as mainframe maintenance and Y2K readiness
during the 1990’s.
CODCs set up by these early pioneers have since evolved from a tactical to a
strategic role depending on the evolving corporate strategies of the parent
companies. The maturing of these centers did not happen overnight. The
executives of these organizations made services globalization a priority and
they carefully chose the appropriate model for their CODC, which aligned well
with overall corporate strategic objectives.
We are tracking the offshore outsourcing space to give you updated news, views
and trends to add value to your offshore outsourcing decisions. This issue
outlines a framework for evolving the capabilities of Captive Offshore
Development Centers.
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| Offshore Sourcing Articles
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Captive Offshore Development Centers (CODCs): Are they delivering the desired
value?  |
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By neoIT
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The increased acceptance of offshore outsourcing with IT departments and
Independent Software Vendors (ISVs) has encouraged the development of global
delivery models through geographically dispersed company owned captive offshore
development centers (CODCs). Capabilities of CODC’s differ based on the
strategies of the parent organization and should be expected to evolve over
time to better align with the overall strategy of the parent organization.
The CODC framework discussed in this paper identifies the key factors that need
to be in place within the CODC for it to move beyond its cost reduction role to
a more value-added role of supporting the parent organization’s business
strategies
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| Industry Research and Case Studies |
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2005 Outsourcing World Summit Summary |
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International Association of Outsourcing
Professionals
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The just completed Outsourcing World Summit, the 17th in a
global conference series first held in 1998, brought together more than 400
executives and professionals from across the field and around the world. The
collective insights of the speakers and delegates would rival Google as a
source of information on the topic of outsourcing.
The following is a compilation of 46 top facts, figures, and findings shared
over the event's three days.
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Analyzing Attrition |
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CLSA
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Attrition has a direct impact on a company’s gross margins.
Attrition remains high despite salary increases and companies may have to slow
down in order to manage the costs and SLA’s. This is however not true incase of
IT services where attrition has shown a downward trend on account of salary
increases. In IT services Wipro, Satyam have a higher attrition than Infosys.
BPO attrition is significantly higher versus IT services and within BPO
attrition for voice based is significantly higher than that in transaction
processing. The positive flipside is that there will be massive recruitments:
150,000 in IT services and over 225000 in ITES during FY05, 06.
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HR Challenges with Offshore Captive Centers |
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By neoIT
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Many organizations have been operating offshore for some time.
Whether thru a joint venture, a wholly owned captive center or a partnership
with a supplier, your services globalization strategy can sometimes take a
wrong turn. Your company’s operations may need a health check to get back on
track. A Healthcheck will address all aspects of an engagement from corporate
strategy, HR policies, infrastructure and quality of the management team to the
financial health of the company, security, disaster recovery and the efficiency
of processes. This white paper is designed to help you understand the steps you
need to take to analyze your offshore operations.
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| Special Events |
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The
Businesses Breakfast Forum
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April 5, 2005
California State University, Oakland, CA
Amritia Joshi, neoIT Director, will be
speaking on
Offshore outsourcing: A bay area perspective for local businesses,
on April 5, 2005.
Download brochure
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HRO World
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April 12, 2005
New York, NY
Tarun Mehta, neoIT Managing Director, will be
speaking on
Real story behind the myths surrounding "offshoring",
on April 12, 2005.
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China Software Outsourcing Conference
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April 14, 2005
Shanghai, China
Atul Vashistha, neoIT CEO, will keynote this
conference and discuss
China's Position in the Global Outsourcing Industry: Then, Now and Beyond.
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INVESTING IN INDIA: Presented by Financial Research Associates
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April 18 – 19, 2005
New York, NY
Eugene Kublanov, neoIT Vice-President
(Corporate Development), will discuss
Outsourcing: India’s Engine of Growth.
Download brochure
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SOURCING
2005: Exchanging Ideas, Sharing Information – Building Value
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May 24 – 27, 2005
Scottsdale, Arizona
Atul Vashistha, neoIT CEO, and
Mehran Assadi, CIO of National Life will host
a discussion on
Why Your Company May Not Be Ready to Pursue or Ramp-up Offshore.
Download brochure
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| Offshore Knowledge Center |
Visit the
Offshore Knowledge Center to learn more about global and offshore
outsourcing. Examine best practices on the full lifecycle of offshoring from
assessment and due diligence to transition, on-going management and analysis.
You will find reports written by respected industry analysts, offshore articles
from around the Web, and other important resources, such as newsletters and
presentations.
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What’s new in the OKC |
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