One of CIOs' biggest concerns about the infrastructure-as-a-service model has been the loss of control over assets and management that enterprises might experience upon moving into a multi-tenant environment. While analysts and early adopters of infrastructure-as-a-service offerings have argued that such apprehension is rooted more in fear than fact, Amazon's recent public data center debacle has given everyone good reason to question the reliability of the public cloud.
Stories by Stephanie Overby
Forget all the discussion about IT outsourcing providers moving up the technology value chain to become partners in innovation; their customers' biggest needs remain much more straightforward, according to the results of the IDG Enterprise Outsourcing & Service Providers Survey. (CIO.com is an IDG company.)
Coty is growing.
1. It’s insecure.
Frank Modruson has a thing for better, faster, cheaper. As CIO of business and IT service provider Accenture, that's what he wants to deliver to his internal customers and what they in turn promise to their clients. "I'm a big believer in technology and a big believer that technology helps the business in a lot of ways," Modruson says. "But it needs to be better, faster or cheaper. If you hit all three, it starts to get very compelling."
Looking back on the last twelve months, most outsourcing analysts agree that the level of IT services deals sealed has held relatively steady, year-over-year. The total value of outsourcing contracts signed in 2010 was $62.4 billion, according to outsourcing consultancy TPI, a figure that's pretty consistent with their last five years of total contract value data. The number of IT services deals inked in 2010 grew by six per cent, according to outsourcing consultancy Everest, noting that eight of them were so-called mega-deals of $1 billion or more. About half of IT service providers polled by outsourcing consultancy EquaTerra reported growth in their business pipeline, despite expectations for a much stronger year-end close. Deal flow was uneven in the fourth quarter, EquaTerra reported, and subject to delays.
In what could be viewed as unfortunate timing, management consultancy A.T. Kearney released its annual Global Services Location Index last week naming Egypt the fourth most attractive location in the world for offshore services outsourcing - up two spots from its sixth-place ranking in 2010.
HP today revealed further details of its previously announced $1 billion investment in offshore outsourcing, selecting six countries-Bulgaria, China, Costa Rica, India, Malaysia and the Philippines-as its global delivery hubs.
The Project: Develop the federal government's first open-source cloud-computing platform to provision high-performance computing, storage and network services for NASA's research community and enable scientists and engineers to share large, complex data sets with partners and the public.
CapGemini's announcement last week that it would invest $298 million in Brazilian IT service provider CPM Braxis attracted a lot of attention in outsourcing circles. The move will give the Paris-based company a 55 percent stake in CPM Braxis, the option to buy the company outright within three to five years of the close of the deal, and the chance to leapfrog its global competitors already entrenched in the country.
Dr. Oliver Williamson may not be a household name in IT outsourcing circles, but a consortium of academics is hoping to change that. Williamson, professor emeritus of business, economics and law at the University of California-Berkeley, won the Nobel Prize in Economics in 2009 for his examination of economic governance. Some outsourcing researchers say his lifelong study of transactional cost economics--the practice of accounting for the total costs of a contract, both obvious and hidden--contains valuable lessons for anyone engaging in outsourcing today.
When you think about important leadership qualities, vulnerability doesn't spring to mind.
The project: Equip concierges at InterContinental Hotels and Resorts with Apple iPads to provide guests with enhanced maps and directions, video recommendations, and instant booking confirmations for local restaurants, performances and attractions.
Breaking up is hard to do. And when it comes to IT outsourcing, it can be expensive and risky, too. But issues with an outsourcer--such as deteriorating service levels, lack of investment, excessive turnover, or even fraud--are potentially even more costly than the actual break-up.
Egypt has the most market potential among emerging providers of global IT services, according to a recent study by the London School of Economics Outsourcing Unit.