CXO

India core to future IT sourcing strategy

CIO Jury: Along with China and Eastern Europe, say tech chiefs

India will be one of the key factors in all IT sourcing decisions over the next five years as a low-cost and flexible option for skills and resources, according to CIOs.

Many large businesses, such as Welsh Water and Reuters, have already made outsourcing to India a core part of their IT strategy and earlier this year Norwich Union CIO Alex Robinson told silicon.com half of the company's IT will be done in India by the end of this year as part of plans to slash group operating costs.

All of this week's silicon.com CIO Jury IT user panel said India will be an increasingly important consideration in IT decisions over the next five years.

One of the panel, Peter Pedersen, CTO at the Rank Group, actually responded from a business trip out in India. "At the moment I am in the midst of a large project, which could not have been undertaken using UK resource," he said.

Kevin Fitzpatrick, CIO at Sodexho UK, said: "Every IT Director is under pressure to ensure services are cost effective and off-shoring is now a common, proven solution - with India as the most obvious location. As always the total cost of the service and impact of having staff so many hours away needs to be considered. It is not viable for all areas."

Get the latest exclusive CIO interviews in the silicon.com CIO Vision Series include

British Airways
Reuters
Virgin
Linde Group

The skills and resources available make India increasingly an option that can't be ignored, according to Luke Mellors, CIO at Expotel.

He said: "However, CIOs also must come to grips with how to manage sourcing decisions and the impact these decisions have on culture, management and grassroots innovation as well as have clear understanding on the deliverables for such a move. Don't ever offshore a problem, it only compounds it."

Paul Broome, CTO at 192.com, said using India is better suited to companies with classic "waterfall" development cycles and large support overheads but not for dynamic and nimble enterprises which lead with technology.

He said: "I've worked in India and culturally people often but not always feel duty bound to say 'yes' when actually they mean 'no' or 'possibly'. Fine for large lumbering support type work but disastrous if you have tough deadline-driven projects."

Others said that while offshoring is now an accepted and proven mainstream IT option, other locations will increasingly challenge India's current dominance.

Graham Yellowley, director of technology services at investment bank Mitsubishi UFJ Securities International, said: "India is already a major consideration for IT sourcing with companies such as Wipro and Tata being very strong contenders. Eastern Europe is now also becoming a consideration and very soon so will China."

Andy Pepper, director of business IS at Tetley, added: "I believe rising costs in India will mean that many other countries will also become strong contenders for outsourcing in the timescale of five years ie India won't be the only choice."

Today's CIO Jury was…

Ade Bajomo, head of IT strategy and systems, Pearl Life
Mark Beattie, IT director, LondonWaste
Alastair Behenna, CIO, Harvey Nash
Paul Broome, CTO, 192.com
Mark Dearnley, CIO, Cable & Wireless
Kevin Fitzpatrick, CIO at Sodexho UK
Chris Ford, IT director, Severn Trent Water
Nick Masterson-Jones, IT director, Voca
Luke Mellors, CIO, Expotel
Peter Pedersen, CTO, Rank Group
Andy Pepper, director of business IS, Tetley
Graham Yellowley, director of technology services, Mitsubishi UFJ Securities International

Want to be part of silicon.com's CIO Jury and have your say on the hot issues for IT departments? If you are a CIO, CTO, IT director or equivalent at a large or small company in the private or public sector and you want to be part of silicon.com's CIO Jury pool, or you know an IT chief who should be, then drop us a line at editorial@silicon.com

Editor's Picks

Free Newsletters, In your Inbox