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IT Offshore Outsourcing in Capital Markets (Part 1)
Here is an excerpt from CIOInsight.com in its March 2007 outsourcing survey on savings in outsourcing: “68% say outsourcing is overrated as an IT cost-cutting strategy, 67% say the total cost of using domestic outsourcing vendors has been as or more expensive than doing the same work in-house, 57% disagree that the total cost of using offshore outsourcers has been more expensive than doing the work in-house.” The only groups in the survey in which a majority save money (or at least doesn’t lose money) are ones using offshore outsourcers.
Offshore outsourcing is no longer an experimental option. It’s the direction of the industry and it makes business sense to execute it the right way.
The paper serves as a guideline for IT managers planning to move development offshore. The issues discussed are from an outsourcer’s perspective. The focus is more on time and money (T&M) engagements as compared to fixed price (FP), because in FP there is little control of the outsourcer. The points discussed are based on the author’s experience in the investment banking (IB) or capital markets IT industry, but should be applicable to other verticals. The paper isn’t about the merits of offshore outsourcing.
The various sections in the paper are IB IT industry traits, FP and T&M engagement definitions, typical notions on…
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