Outsourcing News and Tips

There are some interesting facts of the win-win collaboration between President Obama and technology during the elections:

Barack Obama – the most technology-oriented president ever. Using social networking sites like twitter and facebook, blogging, and raising millions of dollars from small donors through a brilliantly-executed websites Barack Obama was pictured many times tapping away on his Blackberry or laptop. All those showed that he is modern and has his finger on the technology pulse. Ben Scott, policy director for Free Press called Obama a “master” of using the Internet and said his level of engagement with technology and technology issues is uncharacteristic of politicians.

During election campaign Obama broadly used internet, and undoubtedly technology helped hom to win the election. Here are some examples of his interaction with Web:

- Facebook – Obama made a splash initially by appealing to young voters, who were typically apathetic good-for-nothings. Unlike his rivals, Obama was ‘down wid da kidz’ from the beginning, becoming one of the most popular celebrities on Facebook, with over 2.5m followers. This provides Obama with a direct contact to them – his campaign had been sending out daily messages to everyone’s Facebook to get the message out and motivate supporters.

- Twitter/UStream – @barackobama’s 120,000-odd followers got regular updates on where he was and were regularly provided with links to watch rallies being streamed live over the internet.

- YouTube – Obama’s base could be described as the “YouTube generation”, and thanks to the magic of modern technology, all of the major events from the campaign can be found on YouTube. Obama’s big speech on race has been viewed over 5 million times on the site, which is more than the combined cable news audience who watched it. Similarly, YouTube has become a campaigning tool for more grass roots support, with one music video putting an Obama speech to music has had over 11 million views. And these are just two small examples.

- Obama’s technology platform is “among the most detailed and thoughtful of any presidential campaign ever”. Obama’s 43-page blueprint includes support for the principle of network neutrality, bringing true broadband to every community in America, ensuring U.S. goods and services are treated fairly in foreign markets, investing in the sciences, and providing new research grants to the most outstanding early-career researchers in the country.

- President Obama Inaguration the 5th most wathced net event ever. The swearing in of U.S. President Barack Obama and the other presidential inauguration activities generated massive Web traffic Tuesday, leading to collective Web-sites slowdown.

All those facts undoubtedly impacted on historical victory of the first African-American President of United States. So what will President Barack Obama do for technology industry?

As today’s economic crisis hit almost every industry and becomes more and more destructive not only for US but for all economies around the globe, the main priority for the new administration is to fix suffering economy, create jobs and restore workability of key industries. In the current conditions technology industry is not typically viewed as a main job producer. Indeed, much of its manufacturing is highly automated. But rolling out technology in various service fields like health care, telecommunications and energy can be quite labor intensive.

One way for new administration to create jobs in a hurry is to pour money into old-fashioned public works projects like roads and bridges etc. And Obama’s large economic recovery plan cover that, but it also has some ambitious 21st-century twists. During the campaign and afterward, Obama has stand for policies to promote electronic health records, faster and better broadband networks, and power grids that use computers and sensors to fine-tune electricity use.

The $825 billion stimulus plan presented by Democrats in the House of Representatives this week called for $37 billion in spending in three areas: $20 billion for computerizing medical records, $11 billion for smarter electrical distribution grids and $6 billion to expand high-speed Internet access in rural and underserved communities. In the study prepared for Obama’s transition team pointed that putting $30 billion into those areas could produce more than 900,000 jobs in the first year. The government investment in these technology areas can facilitate further innovation and efficiency commerce as well as help to create pioneering digital industries. There is an opportunities to create jobs to support scientists and engineers, while they with advanced degrees develop new technologies other functions such as, installing, tweaking and maintaining of that technologies employs far-broader of workers with a range of skills and education. For example, some of people losing their technical support in the financial industry could find work helping doctors’ offices to develop electronic record-keeping. “The jobs involved do tend to span the spectrum of skills and income levels. And they are not going to be outsourced offshore.”

From this perspective seems like Obama jobs plan has big Tech Role, proponents of spending on digital infrastructure claim that economic effect are greater than for conventional public works. The high-tech investments, they say, can be the contemporary equivalent of U.S. government financing for highways in the 1950s. The new highway system had wide-ranging impact, enhancing social mobility and stimulating the growth of industries including automobiles and national retail chains.

One danger, some economists warn, is that industry-specific government programs can tilt markets to the advantage of some companies and hurt others, putting Washington on the path of picking winners and losers.

For years, technology policy in the United States has focused mainly on broad measures like government spending on basic research and tax credits for private investment in research and development. Obama has vowed to increase spending on basic research and make tax credits for research and development permanent.

But the incoming administration’s plan for large programs focused on specific industries is a departure. How investments and incentives are designed, experts say, will be crucial to companies, consumers and taxpayers.

Prepared by Offshore IT service provider Mirasoft Group
Based on toptechnews.com

During this global economic crisis more and more companies are considering to cut costs and increase technology expertise at the same time. From that perspective outsourcing is seen as liveable way to cut the costs, but shaky economy requires firms to do their outsourcing much more cautiously than ever before.

“Whenever there is a downturn people outsource more, not less,” stressed Linda Cohen senior analyst of Gartner. “Companies want to take costs out wherever they can. CFOs are pounding in to their CIOs to just outsource everything, just offshore it.”

In today’s tough economic environment organizations have to carefully weigh all benefits and risks of sending work to outsourcing providers as well as once again reexamine what might be outsourced and what should stay in-house. IT leaders may forget all lessons they learned rushing into bad outsourcing agreements and chasing elusive benefits.

Nevertheless, outsourcing model can provide companies with substantial benefits to bring in service providers on the single-purpose basis without investing to permanent operational costs and hiring new employees. Moreover, outsourcing providers continually invest in the latest technology and develop their skills, offsetting expenses by sharing technology among several clients. Mostly, outsourcing provider is specialized on the specific operation you consider to outsource, and his experience, talent and technology might be as good or better than you can re-create internally.

Peter Mauthe, the president of Dallas-based Rhoads Lucca describes outsourcing as a driver for growth. “It’s a crucial factor for us being able to grow our business. It allows us to focus on our business,” he stated. “We could increase the size of our company five-fold in revenue and only hire five or six more people, because we outsource so much of the really technological skills, such as accounting and IT.”

By outsourcing non-core functions, organizations can concentrate on their main business rather than getting stuck in operational services. Especially, taking today’s recessionary times when budgets are so tight and firms can’t afford to pulverize their efforts broadly. According to recent studies the main priorities for technology industry in 2009 will be on the one hand an innovation, as the vital element of the fight for scrupulous customers and on the other hand an efficient IT organization, as the part of dilemma for CIO’s “how to do much, much more with potentially much, much less”. In both challenges CIO’s will have to figure out how technology can help and how IT service provider could be an efficient partner in innovation.

The current meltdown has already impacted almost all industries in the economy arround the world, even large hardware manufacturers such as Lenovo slashed thouthands of jobs. But so far most of studies reported that IT related areas wouldn’t be hit as much as other industries, however last week announcment of the Internet search giant Google that it will significantly reduce the number of contract workers it uses don’t seem encouraging at all. What challenges PPC advertisement industry will meet during this meltdown?

I have been hearing from many people in the search industry that the recession won’t impact the search space as much as the rest of the industries in the economy: reported Barry Schwartz, Search Engine Land’s News Editor.  In fact, many people feel that search will grow, while we see other industries take huge double-digit declines. I am skeptical about the search industry not taking a hit. So when we see search companies release data, it worth to take an interest.

Alan Rimm-Kaufman, who is incredibly data driven, posted an aggregate data analysis of his client’s fourth quarter 2008 versus 2007 search ad spend. Here is some numbers:

·        PPC Sales: showed a growth for 35% of Kaufman’s clients but a decline for 65% of his clients in the 4th quarter of 2008 vs. 2007

·        PPC budgets: 25% of Kaufman’s clients increased their PPC spend 2008 Q4 vs. 2007, while 75% pulled back PPC spend

Not so great results as for me. However, recent report of SearchIgnite claims that retail search spend up 33% so far in fourth quarter 2008, compared to 2007. This is specifically retail, but still, overall search spend is up 33% for this company that manages over $350 million in paid search annually.

For this moment we have some more of other forecasts for 2009, but no one can really predict how this industry will behave itself in the worst economical crisis since the great depression.

Prepared by Mirasoft Group: www.mirasoft-group.com

Many organizations that choosing to move IT projects to lower-cost destinations are daunted by the task of determining which destination would best feet to host their operations. Recent report from research and analyst company Gartner looked at the credentials of 72 countries as offshore locations, and listed the top 30 destinations in 2008.

This year has seen India, China, Russia and Brazil continue to dominate as offshore leaders, but it has also marked the rise of new outsourcing destinations such as Egypt, Morocco, Panama and Thailand that replaced Northern Ireland, Sri Lanka, Turkey and Uruguay from their 2007 positions in the Top 30 list.

According to Ian Marriot, research vice president at Gartner, outsourcing destinations will be seeking to take advantage of the opportunities created by the increased focus that many organizations have on cost optimization, as a result of the current economic crisis.

Gartner used ten criteria that it determined important for organizations to consider when looking at a potential location for offshore or nearshore IT operations or business process services. They were: language, government support, labor pool, infrastructure, educational system, cost, political and economic environment, cultural compatibility, global and legal maturity, and data and intellectual property security and privacy.

Considering EMEA, locations such as Ireland, Israel, Northern Ireland and South Africa rated well for language skills, because of the quality and quantity of English-language speakers. However, other countries such as the Czech Republic, Slovakia, Hungary, Poland and Romania were also given credit for the availability of alternative languages that address the needs of an increasing number of continental European buyers.

Recent EU entrants Slovakia and Romania, together with Russia and Ukraine were scored well on cost grounds. Increasingly, companies are choosing offshore providers in Eastern Europe countries such as Ukraine, where language skills are better and outsourcing providers appear to have a more in-depth understanding of their clients than competitors farther east. Ukrainian offshore outsourcing companies have been providing software development services since early 1990s, one of them Mirasoft Group started to provide outsourcing software development services since 1989, and for today the company already exist more than 19 years.

And even Gartner reported that in EMEA the government support achieved low ratings and there are some challenges in cultural compatibility. It might be ameliorated rather soon due to start of Central and Eastern European Outsourcing Association (CEEOA). The association was launched to promote outsourcing providers in Eastern Europe, and intends to pool resources from associated bodies based in the Baltics, Ukraine, Hungary, Bulgaria and Romania, in an effort to increase the volume and quality of service delivery in particular states.

The main goal of CEEOA is to prove that although Eastern Europe is still charged more for IT outsourcing than Asia, the cost is counterbalanced by the high quality, innovation and ability to cater to local needs.

Gartner also found that external service providers (ESPs) have started to target places outside the ‘Top 30’ to get closer to mature countries, such as the Nordic regions and France that show increased interest in offshore. “Given the current financial turmoil, cost will remain an important factor. However having the right balance between lower cost and higher risks, and lower risks and higher costs will be critical in times of recession and uncertainty,” said Mr Marriott.

Prepared by Mirasoft Group – http://www.mirasoft –group.com