Big Data: buzzword or technology trend?

IBA Group
Mark Hillary

Big Data is often viewed as a big buzzword, but it’s a technology trend that is affecting everyone in their daily life – as well as changing the way enterprises need to organise their systems.

Ninety percent of all the data that exists in the world today was created in the past two years, according to analyst firm IDC. The average American office worker generates 5,000mb of data every day just by working on documents, sending emails, or downloading videos. By 2015 the amount of data we are creating now will have doubled – we are exponentially creating more and more data faster and faster.
You might think that these figures sound exaggerated. How could I have created thousands of megabytes of new data just by going into the office today? It’s easy with emails being copied and shared and presentations today requiring more images and more video – the enterprise has moved on from an era where text alone was enough.

The figures from IDC suggest that data creation will have grown by 2000% between now and 2020. And regular consumers create 75% of all this new data. This is because 87% of American adults constantly publish their location – often unknowingly – via their mobile phone and 65 billion location tagged payments are made in the US annually.

As more consumers carry more devices with the ability to measure and record more information, often automatically uploaded to the Internet, there is a sea of data being created and it affects every possible business and industry in every location.

Organisations in many industries are now facing pressure to explore Big Data, to find how they can get value from mining the information they have on clients and transactions, but it needs tools and expertise to get right.

This is one kind of enterprise project where it is almost certainly better to outsource the work to an expert than to try performing in house. You can buy some tools and make an attempt at examining the data you have, but if you don’t know how to configure those tools or where to start looking then your Big Data project might just turn out to be a big mistake.

Visual web, Big Data and enterprise technologies

IBA Group
Mark Hillary

Our last blog mentioned the growth of the visual web. This is an important trend that is changing how content is consumed on the Internet in general, but is also changing the expectation of how managers consumer content within organisations.

2013 was the year that images surpassed text as the most popular means of communicating online. Pinterest, Tumblr, Instagram, and Facebook have become the most popular ways to communicate and these tools are largely visual.

Storing and managing all these images is becoming an enormous big data problem too. There is a growing need to take control of Big Data that is becoming more urgent each day. Ninety per cent of all the data that exists in the world today was created in the past two years, according to analyst firm IDC. The average American office worker generates 5,000mb of data every day just by working on documents, sending emails, or downloading videos. By 2015 the amount of data we are creating now will have doubled – we are exponentially creating more and more data faster and faster.

Figures from IDC also suggest that data creation will have grown by 2000% from now to 2020. And regular consumers create 75% of all this new data. This is because 87% of American adults constantly publish their location – often unknowingly – via their mobile phone and 65 billion location tagged payments are made in the US annually.

All this automatically published information combined with images and video mean that the way we communicate is changing fast. This affects the way companies hire, the way they market their services, and the way they communicate internally.

Enterprise technologies will need to reflect the established public networks if corporate communication – internal and external – is going to succeed in future.

How important is visual information in your business?

IBA Group
Mark Hillary

How important is visual information in your business? What do you think of as visual anyway – a chart on Excel or some other reporting system?
The most recent funding round for Pinterest boosted its valuation to around $3.8bn, which sounds like a lot of money for something that just looks like a visual scrapbook on the web.

When Mark Zuckerberg of Facebook bought Instagram in 2012 for $1bn many commentators thought that it was outrageous – Facebook had overpaid for a phone based photo-sharing service that didn’t even have a website.

Facebook eclipsed that deal recently when they purchased Whatsapp for $19bn. Whatsapp is a text messaging tool that is popular all over the world, but particularly in fast-growing developing nations such as India and Brazil. But what is really different about Whatsapp is that it allows easy photo and video sharing – it is not just a tool for texting, it offers a complete visual experience too.

Take a look around the Internet. It is becoming more visual. Many bloggers are choosing to just create a video instead, or to create a blog that only contains photographs.

Photo network, such as Flickr, offer free space to users that measures in the terabyte – unthinkable amounts of space just a few years ago, yet now it’s almost essential because the Internet is becoming more visual and more focused on mobile devices as the tool that is used to consume content.
This means that companies using the Internet need to consider how their own information can be reflected. How do you publish corporate reports and information when the trend for information use is becoming more visual?

Consumers are getting used to ‘reading’ Instagram and Pinterest in the same way they used to read the newspaper and this is affecting corporate life. A manager today will not want to read a dense report packed with numbers. Visual information has always been useful, but now it’s essential if you want to convey a message within your organisation.

Visual reporting

IBA Group
Kirill Degtiarenko

We live in the era of Big Data. These days everyone is overwhelmed with information. There’s no time to read and analyze the data that come to us from different sources. This is where data visualization can help.

According to Visual Teaching Alliance, “it is hard to argue with the observation that the generation of students now moving into and through our educational system is by far the most visually stimulated generation… In fact, research shows that 65% of our students are visual learners.”

They say a picture is worth a thousand words and we see how images today seize the online content. People and companies document their lives with photos. The web is turning into a visual landscape.

Data visualization is already mainstream. As a result of visual presentation, complicated and potentially dull information becomes easily understandable and comprehensible.

The BI market is also shifting, from tables and spreadsheets to diagrams and infographics. It is inherent to a human being to perceive visual images quicker than plain text or numbers. We “read” graphical information several times quicker than data in a spreadsheet. The user can see the key data at a glance and therefore make efficient analysis and a grounded decision.

Clarity and ease of grasp make a report efficient. Based on visualized data, it is possible to make a timely and grounded management decision. High quality visualization enables managers to achieve good business results.

A report title should be also catching and reflect the essence of the report in a clear and concise form. Diagrams serve as a good tool for data visualization. Color serves to highlight certain details and make selected data easy to remember.

The following is an example of how a complicated spreadsheet turns into a visual report.

Spreadsheet Visual report1 Visual report 2

Offshore Outsourcing is About Finding the Best Talent

IBA Group
Mark Kobayashi-Hillary

Offshore outsourcing (often called offshoring) often gets a bad press. Many people assume that offshoring must be all about finding the lowest cost service and therefore the world is engaged in an endless race to the bottom, searching for lower and lower costs.

It’s not like that at all. An interesting article in the business magazine Forbes challenges the conventional wisdom on outsourcing. For instance, even though the US and Europe account for about half the economic activity of the entire world, only about 10% of the global population lives in these two regions.

This means that there are an enormous number of highly skilled people outside the wealthiest nations on earth. Working with this talent is essential because of the difficulties involved in finding these people locally.

And many companies are more globally oriented today. If you wanted a new logo designed in the past then it would be done by a local designer, now it’s done anywhere in the world based on finding a designer you like. Any intellectual task can now be performed anywhere in the world so the issue today for companies of all sizes is that if you are not working globally then how are you finding enough skilled resource to keep you ahead of the game?

And finding the right talent to support your team back in headquarters is only half the story. If you want to expand to new markets, what could be better than working with a team of people in those new markets to give you a footprint and a first step into the new region?

Offshoring has often been misrepresented, but it is now an essential part of corporate strategy that aims at making the skills of the entire world available to clients, wherever they are located.

Finding SAP Expertise Just Got Easier

IBA Group
Mark Kobayashi-Hillary

What is the most common reason any company will work with a technology partner through an outsourcing deal? The most common response is often because it costs less than hiring the expertise internally, but this is not always true – cost is sometimes a driver, but not always.
Flexibility is usually a more important driver. Flexibility to find expertise exactly when and where those skills are needed, especially when the skills don’t exist internally.

When a big project is being designed and created it may be that particular technical skills are only needed for the implementation. It makes no sense to hire the expertise internally in the same way that you probably go to your local car dealer when your car needs a service rather than doing all the work yourself.

SAP is a great example of this principle. Founded in 1972, SAP is the world’s largest business software company having more than 55,700 employees in 130+ countries. Today, more than 183,000 customers in 130+ countries use SAP software on their workstations. SAP is a very popular business tool, but the companies using it don’t need to keep SAP experts on their own payroll all the time – it makes more sense to work with a partner like IBA when the expertise is required for planning and a new implementation.

IBA has worked on the application of SAP projects since 1996. There is now a team of highly–skilled professionals with almost two decades experience in diverse and mission-critical SAP projects.

This principle can be applied to any technical tool, but SAP is one of the most popular business systems used globally. IBA has the expertise and can deploy consultants and even run your technical help desk for questions related to SAP and all for the lifetime of your project deployment.

In this case, outsourcing allows you to tap into a large talent pool. You can get the right SAP skills in the right place at the right time – every time.

Read more about SAP experience within IBA.

German Outsourcing Association Research Promotes Eastern Europe

IBA Group
Mark Kobayashi-Hillary

The Outsourcing Journal published a research paper last year focused entirely on the merits of ITO and BPO in central and Eastern Europe.

Organised by the German Outsourcing Association this is an interesting paper with contributions from across the CEE region, including those of particular interest to IBA, such as Belarus and the Czech Republic.

Stephan Fricke, CEO of the German Outsourcing Association wrote about the future for outsourcing in the introduction to the paper: “The future looks bright for CEE IT and business process service providers. Why? Because, speaking for our home market Germany, the demand for IT skills and business process knowledge will not decrease. Quite the opposite is predicted, which is not difficult to explain. The current situation in Germany, where companies are unable to fill desperately needed positions in IT and higher qualified jobs as engineering is caused by failed educational policy and there are no signs that the government has efficient tools to manoeuvre against.”

Fricke went on to add: “So German companies will be forced to look outside their borders for IT-project support and the most accessible destination for that is the CEE region.”

Once again a major trade association has pointed out that far from sourcing being just a low-cost way of doing business, companies in Western Europe need to look beyond their own borders to grow quickly and expand. CEE-based companies like IBA are well placed to work with companies in countries such as Germany – to help them succeed as Europe enjoys economic growth once again.

New Technologies Coming in 2014

IBA Group
Mark Kobayashi-Hillary

Welcome to 2014 from IBA. This is going to be an exciting year! Not only is the European economic recovery really starting to pick up – with the UK probably leading the way – there are new technologies that are coming onto the outsourcing scene and becoming really important.

An article in CIO magazine highlights the top 10 outsourcing trends to watch out for this year.

IT outsourcing experts say: “this could be the year customers — and a few robots — take greater control of the IT outsourcing space”.

Our favourites from the CIO list are:

Hybrid offshoring; offshoring will continue to be an important trend, but many companies will explore how they can do it partly themselves and partly with a supplier – in a more blended way than before.

The cloud being grounded; the cloud is here to stay, that cannot be denied, but many companies have jumped into cloud-based services without realising that they often need a complete culture change, not just a technology change. It’s likely that some companies will step back and plan better for the cloud this year.

Lower cost consulting; we all know that most consulting is overpriced and many companies that deliver services can provide great advice as well as delivery – this is going to become a more popular consulting solution this year.

Of course CIO mentions several more trends, but what do you think will be the big outsourcing stories of 2014? Leave a comment here or tweet us on @ibagroup.

Is Offshoring Now Moving to Nearshoring?

IBA Group

Mark Kobayashi-Hillary

It’s interesting to see the Indian press recently reporting research from the Wharton School in the USA on the offshore outsourcing climate in India. The Wharton data reports that many companies are exploring how to reduce their offshore outsourcing strategy – now preferring to find ways they can reshore or nearshore the processes.

This makes sense. Outsourcing for an enormous cost reduction may have been a driver a decade ago, but it’s not possible in the India or China of today. Service quality has become far more important as supply chains have become more complex and this does mean that many companies now want to keep their team closer.

This general shift in strategy does lend itself to technology experts positioned in central and Eastern Europe. The Indian technology boom of the 2000s will not persist into this decade if the more general business strategy is to start keeping valuable assets closer to home.

It is not always possible or desirable to undertake every technical task in the immediate vicinity of the head office of an organization, but the nearshoring option does allow companies in Europe to work across the rest of the continent.

In the past the nearshoring versus offshoring debate was always nuanced by the difference in cost, but now that many companies are actively trying to find a way to keep their team closer together, it seems the value of remote offshoring is declining.

Nearshoring in Europe – The IBA Group Webinar

IBA Group
Mark Kobayashi-Hillary

IBA Group recently hosted a webinar on nearshoring in Europe with me and the team from ‘Outsource’ magazine. You can listen to the entire webinar recording here.

This blog is a text version of my own talk during the webinar. I edited the talk as I was speaking during the webinar because we were a little short of time – it was better to talk less and spend more time on the Q&A – so here is the full version of what I prepared to say during my own presentation:

On this webinar today we are going to talk about nearshoring.

Nearshoring and offshoring and rightshoring are all phrases used quite interchangeably in this industry and many of these phrases were invented by analysts – who then sell you the research that allows you to understand the terminology.

So, I’d like to keep things fairly simple. I’m also aware that if you are on this webinar then you probably have a good idea what we are talking about and you will be more interested in the polls and Q&A than the introductions.

There is no strict definition on how close nearshoring needs to be so this is not an exact science, but a good rule of thumb is whether it is possible to visit your supplier and get home all in one day.

Now this does apply to European clients interested in working with suppliers in central and Eastern Europe so it’s probably the best definition to work with. The Americans consider Mexico to be a nearshoring destination, but you try going from Boston to Monterrey and back in a day.

As I said, none of these definitions are an exact science.

When IBA asked me to join in with this session today I looked back at some of my books and writing on outsourcing to see how often I had mentioned nearshoring. In my 2004 ‘Outsourcing to India’ book I couldn’t find a single reference to nearshoring and even the 2007 book I wrote for the British Computer Society didn’t feature it as a distinct type of offshore outsourcing.

But when I looked at my Talking Outsourcing book, which is really just a summary of all the best bits I wrote for Computing magazine between 2006 and 2009, it is mentioned several times and identified as an important trend – the way ahead.

Nearshoring was clearly an accepted business strategy during the past decade, but it has only evolved into a practice that is separate from offshore outsourcing more generally in the past five years – the post financial crash period of time.

We should not forget how far outsourcing has come in the past decade. It’s now a standard, accepted strategy for businesses in any industrial sector and to reject the opportunities of working with an expert partner is now seen as highly unusual.

Look at the IT market globally. There are so many more platforms for IT systems to run on today, from wi-fi enabled televisions to the apps on your phone. None of this existed a decade ago when we were all talking about parceling up IT development projects and sending them off to India.

Look at a classic business process outsourcing task like customer service. A decade ago this would have meant paying for agents in a call centre and possibly including some email support in the contract. Now customers expect information immediately available before they make a purchase, they want information when in the middle of a purchase and they want to be able to contact you after a purchase – for support or complaints. And all of this communication can take place on email, phone, chat, Twitter, Facebook, or any other social network you care to name.

In both the IT and BPO markets there is far more complexity today in terms of platforms that can be used and how services need to be delivered.

This reinforces the classic reasons for working with a partner rather than trying to do everything in-house:

• You can contract for a service or project knowing that the partner you choose has the skills needed to deliver – you don’t need to search for those skills and then keep them fresh.
• Your partner will have experience of delivering similar projects to other companies. This expertise is extremely valuable when the market is changing so fast.
• The total cost of getting this expert resource should be less than the price of doing it yourself, when considering all the complexities in delivering tech projects today.

When we talk about offshore outsourcing, we always get back to the cost argument. However, I think the argument that you can always save a bundle of cash when outsourcing belongs back in the early part of the last decade.

If you want to find a high quality partner with experience and expertise in the service you need and you want them to deliver successfully without failure then that will not be cheap. It will probably be slightly cheaper to use a partner than to build the capabilities internally, but you can go to market immediately with a partner, you can hand a lot of the project risk to your partner, you can pay as parts of the project are delivered.

There is a big difference between the cost of a project and the value of that project and I’m sure this is a topic that will be mentioned today.

As we see offshore outsourcing now settle into its status as a regular part of management strategy, nearshoring in Europe is becoming an important trend and is worth exploring further – and there are a few reasons for this:

The Euro crisis has stabilized. The situation in the Euro zone is far from rosy, but this is mainly due to a lack of economic growth and the pain of austerity in southern Europe. Nobody is talking about Grexit today.

The EU is expanding. There has been no change to the expansion strategy and the more nations included in the club – there are now 28 – the easier it is for cross-border transactions and labour movement to take place.

The low cost offshoring model is over. Companies want their suppliers to be physically closer, similar in management culture, and reliable.

Last year the business magazine Forbes predicted the end of IT and BPO offshoring to India within 8 years – so that leaves another 7 years left to run.

I wouldn’t believe that all offshoring to India is about to die out as Forbes predict, but the market has entirely changed from what we knew a decade ago.

Do you remember executives rubbing their hands together when they looked at the cost of IT in India? They would double the size of the team to get over the issues of slower delivery from such a remote location.

But costs have increased. It’s no longer a cost reducing strategy to just offshore everything to India.

This is applicable in many markets today. I recently met the Brazil CEO for a major Indian IT service provider and he told me that it’s cheaper for them to hire technical experts in the USA than in Brazil. They are building out their team in South America not to take work from the USA, they want to bid for business in South America and they know that the clients want a great team with experience – and they want that team close by.

The IT market is also changing compared to those days when a big project could be specified and then sent off to a development team. Agile development is far more popular today, teams want to release code weekly or every few days – not every 6 months. The IT teams need a client that is close and involved and rapid development lends itself much more to a nearshored business model.

I think that we also need to include a couple of further points in our discussion:

. app development is entirely different to traditional IT development. Immediate global shop window and nobody cares where it was developed. Angry Birds is from Finland. Ustream is from Hungary.

. markets like odesk are allowing small teams to be built then broken apart so small IT projects can be delivered using a virtual team – no need to outsource at all.

But nevertheless, in the corporate world and manager that needs an IT project to be delivered today is unlikely to be exploring an option where the partner is on the other side of the world. Even where a company that originated in India or China is concerned, they will be offering more local delivery from Eastern Europe. Nearshoring is clearly one of the most important strategies today if you want your offshore outsourcing programme to succeed.

Eastern Europe is becoming a tech hub

IBA Group
Mark Kobayashi-Hillary

Several business magazines and journals have been focused on growth in Central and Eastern Europe over the past few months. The main angle of the observations is that the CEE region has moved far beyond the traditional role as a lower cost alternative to undertaking technology work in Western Europe and is now fostering a hub of talent that should be sought after by the world.

There are now a number of successful startup companies from the region that are dominating their own niche. Ustream from Hungary is a great example. People all over the world are using the Ustream app to live stream events direct from their phone to the Internet without ever questioning where the app came from.

And even in the more traditional IT service sector, the talent available is some of the best in the world. The CEE region regularly ranks at the top of the world for educational achievements in maths, science, and technology. In the 2013 Google Code Jam competition, 16 or the 24 finalists were from Eastern Europe.

The IT service sector is already strong and mature and the startup sector is growing. All the major European accelerators are now regularly visiting the CEE region and looking for companies to invest in. This growth in the innovative startup sector will only make the wider IT community stronger as the CEE region becomes a place that people want to include on their CV. Have you explored some of the opportunities available from companies working in the CEE region yet?

What Are the Secrets to IT Outsourcing Success?

IBA Group
Mark Kobayashi-Hillary

A recent article in the TechTarget publication, Microscope, explores the secrets to creating a successful IT outsourcing relationship. Many managers have experience of outsourcing these days – it’s no longer the secret it once was, but are the secrets to success still the same as they used to be?

The Microscope feature focuses on these three attributes as the most important:
– Partnership; work towards a partnership as two companies working together, not behaving like a powerful client paying a service provider.
– Flexibility; reach an agreement and write your SLA, but don’t reach for the contract every time something unusual happens – be flexible enough to help each other.
– Ability to change; your business will change over time, so work towards a long relationship that might be very different to where you started.

These are three great pointers, like maxims for getting outsourcing right. The industry has moved on a long way from the old days of screwing down suppliers to very tough conditions and not allowing them to make a profit, but there is a key point not mentioned in the feature.

Location of supplier remains important. There are some great IT suppliers all over the world, but if you need to work closely with your supplier and you want the ability to meet with them regularly then it would be best to not have that part of the team a 12-hour flight away.

If you are trying to create a genuine sense of partnership, rather than just a client/supplier relationship then nearshoring still works far better than remote offshoring. People are people and people want to see the people they are doing business with – in person.

Rightshoring Decision-Making Process

On October 4, 2013, Professional Outsourcing published a video interview with Sergei Levteev, IBA Group Chairman. In the interview entitled Rightshoring Decision-Making Process, Levteev shared his perspective of rightshoring.

PO: Hello, Sergei. Could you introduce yourself please and your title and role at IBA?
SL: I’m Sergei Levteev. My position in the company is Chairman of the Supervisory Board. It is clear that I’m responsible for all strategic questions in our company, namely finance, investment, and marketing policy.
PO: Could you tell us a little bit about the services that IBA provides?
SL: We are an IT company and our main direction is to provide outsourcing for different projects in different countries. And these are various services: from programming development to support of these programs, migration, and consulting. This is our main activity.
PO: Ok. What is IBA expertise in outsourcing?
SL: First of all, it is necessary to say that IBA was a pioneer of this business in Eastern Europe and now we fulfill projects on five continents in more than 40 countries already. The size of these projects that we are doing starts from a few people and is up to thousands of men/months. And duration is also sometimes quite big: from a few weeks up to a few years. We are covering by our services various platforms. During these years, we have really created partner relations with our major customers.
PO: We are here to discuss rightshoring. What’s IBA definition of righshoring and why is it important for organizations?
SL: In my point of view, mainly you should make a choice between different destinations. In the past, outsourcing was practically equal to Indians. Now, more and more understanding is coming that companies from Eastern Europe where we are present and have our main development centers can fulfill these tasks, probably with a bigger advantage for the customer. Also, it is necessary to add that different expertise and a high level of this expertise is present in Eastern Europe just now. And it is one of the advantages of this direction when you are looking for rightsourcing.
PO: How should an organization approach the idea of rightshoring if they’re looking to outsource?
SL: First of all, to look for references about an organization with whom you are in contact. IT outsourcing is not so easy, it is not so easy to describe what’s necessary to do. There should be some level of trust and this trust is coming from the reference of organizations that already have experience of working with such company. Second point is that it’s necessary to find the right expertise. You know, it’s not possible to cover all expertise that is present in information technology. Some companies specialize in one direction, some are active in another. And it is the right expertise that should be found in various proposals. Once again, I would like to add that some level of common understanding should be found between an outsourcing company and a company which is looking for outsourcing. It means that the same words, the same descriptions should be understood absolutely similarly. This is very important.
PO: So, it’s quite a complex decision–making process then. It’s not just deciding on cost or vertical expertise or a region, is that right?
SL: Sure. Of course, cost is very important because we are on the market and should be competitive. But it’s also necessary to understand what is behind this cost. And very important here is the reference that a service provider can present to the outsourcers. Also, it’s very important to understand that nobody can provide a full range of services and every company has some specialization. It’s necessary to find the right service provider who had expertise for years in a particular technology.
PO: Finally what are the pitfalls around right shoring — what should organisations avoid?
SL: First of all, outsourcers should understand that relations with a service provider will be different than with their own staff, especially when it is an offshoring service, which is the most economical type of outsourcing. An outsourcer feels that it will be absolutely similar, if he has no experience so far. It will be necessary to create such relations from the beginning. Second point is the necessity to pay attention to the items which are not written in the contract. For example, attrition rate of the service provider. We’re proud that in our case we have one of the lowest attrition rates among IT service providers. It’s also an important point that it is necessary to create common understanding for the terminology, for any words you are putting in the contract or any agreement. Sometimes outsourcers and service providers understand the same words differently. I think these are three major points in this case.
PO: Thank you, Sergei.

IBA Group Holds an Event in London to Celebrate the 20th Birthday

IBA Group
Mark Kobayashi-Hillary

Last week, IBA celebrated their twentieth birthday with a fantastic event in London. I was invited to host a part of the evening where some great insights into outsourcing in the years ahead were shared by a range of experts.

The venue for the event was the Wellington Arch. An incredible building in central London that I have travelled past for years and never knew that the public could go inside. From outside it looks just like an enormous statue, but there is a hidden door leading to a network of rooms.

Sergei Levteev, the IBA Group chairman introduced the evening by talking about the foundation of the company twenty years ago. Martyn Hart, the chairman of the National Outsourcing Association (NOA) then talked about the NOA twenty years ago, when outsourcing was a new word – most companies were still talking about Facilities Management.

Then there was the competition between expert commentators. Each expert was asked to deliver a five-minute talk on how they see outsourcing changing over the next twenty years. The audience had voting cards and could choose their favourite, so the audience was listening intently and ready to choose their winner.

You can click on YouTube here to see the four talks for yourself.

The four speakers competing in the event were:

  • Martyn Hart, Chairman of the National Outsourcing Association
  • John Garratt, Editor of IT Europa
  • Derek Parlour, Head of Commercial at National Rail Enquiries
  • Colin Beveridge, industry analyst at Better Practice.

And who won? The audience on the evening chose Derek. His friendly and casual start to the talk led to some great insights into the way suppliers and clients will need to interact in future and the audience warmed to his theme.

If you watch the videos then why not let us know on Twitter which presentation you enjoyed the most?

 

Developing your mobile strategy

IBA Group
Mark Kobayashi-Hillary

Developing a mobile strategy can be a complex time for any company. The last thing you want to worry about is issues such as operating system or technology platform, which is where the expertise of a company like IBA can help, but there are some important decisions to make before you even think of building a mobile tool.

The initial strategic decision you need to think about is whether to build a mobile-friendly website or to create an App. There are advantages and disadvantages to each solution and the correct path will depend on the type of service you plan to offer, but to summarise these are the questions you should be thinking about:

• How immediate do you want the tool? Do you think people are prepared to install an app or would they prefer to just find it online on a website without needing to set anything up on their phone?

• Do you need compatibility across all devices? If you build an app it will only work for a single operating system (Android, Windows, Apple IOS) so you need to build several versions to reach all phone users, but a well-designed website can work on any device.

• How often will it need to be upgraded? If you plan on frequent upgrades then it could be problematic to design as an app as you are asking the user to frequently upgrade their phone applications. With a website it would be automatic.

• What is your budget? It’s a lot cheaper to build and maintain a mobile website than a suite of mobile apps for various operating systems.

But apps have their place. When you need the specific power available on a particular type of device then only an app can tap into that system. If you are building a tool that will be used often then an app can be a better interface – think of how you access Facebook on your own phone. And apps can be designed to also work offline – something not at all possible for a website.

This is the first step on a mobile strategy. There are various technological questions to resolve before working on a solution, but if you have not considered how your service will be used then the technology itself cannot be planned or designed.

CEE Getting More Attractive Than India and China

IBA Group
Mark Kobayashi-Hillary

This blog has often explored the relative advantages of working with IT companies in the CEE region. The Central and Eastern European Outsourcing Association summarises the benefits of the region as:

• Considerable budget savings;
• Ability to focus on core competencies;
• Extensive experience of an outsourcing subcontractor;
• Speed increase in projects tasks solutions;
• Reduced capital investments;
• Full-time access both to IT innovations and high-qualified IT experts;
• Internal processes optimization;
• Improved manageability.

That’s a long list of benefits. But what are the downsides of outsourcing today? There are far fewer downsides that there used to be. It’s true that handing tasks to a partner means you need to monitoring them outside your organisation and agreeing on specific measurable targets, but all managers today are used to working with some form of Key Performance Indicators – even for internal measures of success.

Since 2003 the Eastern European IT market has become one of the most promising markets in IT outsourcing, demonstrating dozens of positive examples of companies the decided it would be better to stay in Europe rather than far across the world to India or China.

According to the Tholons report “2012 Top 100 Outsourcing Destinations“, Eastern (and Central) European countries are now around a quarter of the entire list of most attractive places to work with.

China and India are now facing sharp increases in costs just as Europe is remaining a lower place to do business. The future looks bright for those who consider Europe – and the CEE in particular – as a great place to undertake their IT business.

How is outsourcing changing the IT market today?

IBA Group
Mark Kobayashi-Hillary

Outsourcing is changing fast. Cloud computing, the consumerisation of IT, and trends such as BYOD have all changed the way the CIO plans for IT needs and engages with IT partners.

Outsourcing used to be about literally dealing with ‘my mess for less’. A company with an internal business or IT process would hire an expert service provider who just performed the same function – hopefully making it better or cheaper over time.

Now that IT has become so integral to the function of modern companies, the IT suppliers have become trusted delivery partners. The client company simply cannot deliver without the expertise of their IT partner.

But IT can be procured in many ways today. The iPhone has taught consumers that apps can be installed when needed and deleted when they are not. Services like Gmail have taught consumers that very important systems can be web-based – there is no need for expensive locally installed software.

All these lessons are flowing back into the enterprise and changing how companies want to procure technology. But with the supplier community so well entrenched, how is this going to change the outsourcing market?

This Computer Weekly feature explores some of the questions, but one thing is clear, expert suppliers of solutions are still needed. As these changes flow from the consumer market to the enterprise it is likely that companies will need partners to be closer and more reactive than ever – this looks good for suppliers based in Eastern Europe rather than far from their clients.

Eastern Europe to Dominate the IT Outsourcing Market

IBA Group
Mark Kobayashi-Hillary

A recent article in the IT Outsourcing News explores the various reasons it can be worth exploring the Eastern European IT market. Of course, all the usual benefits are listed:

• Considerable budget savings;
• Ability to focus on core competencies;
• Extensive experience of an outsourcing subcontractor;
• Speed increase in projects tasks solutions;

And many more, but I don’t want to just list the general benefits of outsourcing here. What was more interesting in the article was the reference to the analyst and research firm Tholons Company report ‘2012 Top 100 Outsourcing Destinations.’

Eastern European countries (the CEE region) have covered around a quarter of the list of the most attractive countries for Business Process Outsourcing (BPO) destinations from all over the world.

Considering the relatively small size of the CEE region compared to the rest of the world, to see a quarter of the best global BPO destinations in the CEE region does indicate that the region has some special advantages. The Tholons view of the major reasons for this CEE dominance is:

• Relatively low costs since a number of countries are not EU members; the manpower and well-established infrastructure allow customers to reduce their budget without losing service quality.

• Proximity to their permanent clients from Western Europe due to convenient geographical location, visa-free or simplified conditions (depending on a specific country) for EU citizens.

• Convenience in communications and control – almost all CEE representatives are located in the same or very similar time zone with no communicational barrier as English has remained to be an international language in CEE for quite a long period of time.

• Similar set of rules in business making process: ISO standards are adopted as state acts in the majority of CEE countries and are obligatory for some industries.

• A very high educational background as normal.

So don’t just take our word for it that you should be exploring this region. When analysts produce lists of the best places to do BPO and over a quarter of the locations are in CEE it should make the world take notice.

Despite the Economic Difficulties, IT Workers Are in Demand

IBA Group

Mark Kobayashi-Hillary

Karl Flinders of Computer Weekly published some research recently that explored the development of the CEE outsourcing market in some depth.

One of the standout statistics was around the cost of doing IT work in China today, with an average programmer earning about $20,000 a year. This shows that China can no longer be considered a low cost destination for IT outsourcing and of course there are all the associated problems of distance, language, and culture.

But what I found really interesting was the demand for IT workers predicted across Western Europe. Despite the economic difficulties, IT workers are still in demand and the data published in Computer Weekly shows that by 2015 there will be a deficit in many European nations. For instance, the UK will need 55,000 more IT professionals that it will have, Germany will need 75,000 more, and Italy 55,000 more.

With the costs soaring for IT work in Asia, and Western European countries still needing an enormous amount of IT work – and not having enough IT workers – the argument for working with companies based in Eastern Europe is obvious.

When companies with a good reputation and great expertise can be found just a short flight away – close enough for a day trip – it makes sense to explore this option for many more reasons than price alone. As the example of average costs in China demonstrates, IT outsourcing is today about a lot more than low cost offshoring. Europe needs to work together to plug the skilled worker deficit.

The Continued Threat of Outsourcing

IBA Group
Mark Kobayashi-Hillary

HR magazine published a feature earlier this month titled “lower-skilled jobs still threatened by outsourcing to Europe” – the kind of headline that compels a reader to read on, but the story isn’t quite as described.

The feature is extremely confused for a number of reasons. First, the writer is not just talking about low-skilled jobs – he uses the comparison of experienced IT industry workers to contrast different salaries across Europe. Then secondly, he talks about how salaries in Germany, France, Belgium, and Ireland are up to 57% higher than in the UK.

This confuses me. IT professionals on £42,000 per year are not low-skilled workers and if there are many countries in Europe paying higher salaries than the UK then surely those are the places where most skilled workers will go anyway?

And I would question this data. I have a lot of Irish friends and they are almost all figuring out how to leave Ireland. It is impossible to believe that pay and conditions are better there than in the UK.

The most confusing thing is that this is now 2013. Europe expanded to the east in 2004, almost a decade ago. It feels very strange for the media to be talking about how jobs are threatened by outsourcing when Europe itself is a free trade area that encourages businesses to work across borders – with the free movement of people a key part of the union.

I was recently in a bar talking about the continued expansion of the EU to two senior executives from Austria. I asked them how they felt about Bulgaria and Romania joining the union – they immediately responded enthusiastically and suggested that it will make business with these two important markets a lot easier.

This is the complete opposite of the British reaction – where a fear that thousands of people will flood to London from the new EU member states is still the normal reaction. Only the British press appears to be still fearful of the European Union, with this ‘jobs threat’ headline just the latest example I have read.

There are more British people living and working across Europe than Europeans working inside the UK. So why does the media fear this European jobs threat? It seems that many British people are capable of venturing into the world to find where the opportunities exist.

The East is Rising

IBA Group
Mark Kobayashi-Hillary

International analyst firm Gartner recently suggested that IT Outsourcing this year would be worth around 697 billion Euros. That’s an enormous amount of business and IT service companies are all keen to find a way to enjoy taking a percentage of that global spend for themselves.

While countries like India, China, and the Philippines have dominated the international outsourcing market, there are many locations in Central and Eastern Europe that are now snapping at their heels. Serbia, Romania, Albania, and Croatia are all examples of locations where many IT specialists are located and yet their cost is lower than experts with the same skills in Western Europe.

A recent report on the software development and IT outsourcing industry in Ukraine determined that over the last eight years, the volume of software development and IT outsourcing services in Ukraine has grown by a factor ten.

According to the research findings, in 2011 the volume of IT outsourcing and software development services provided in Ukraine reached US$ 1.1 billion and the number of IT specialists working in the industry reached 25,000 people with 20% growth.

But in many cases, many small companies with no international footprint are located in these countries, ready to do business, but unsure how to find clients in the west. It’s no good just being a lower cost if you have no way to develop relationships with potential clients in the west of the continent.

The East may be rising in importance and certainly worth a look if you are considering outsourcing your IT services, but the companies that are based in the CEE region need to build better relationships with the clients in the west. Without this, they will forever be seen as just a lower-cost alternative to local IT experts and that is a long way from the truth.

Tholons Top 100 Features Many CEE Cities

IBA Group
Mark Kobayashi-Hillary

The latest Top 100 Outsourcing destinations research published by international advisory firm Tholons makes for good reading if you want to explore Eastern Europe. No fewer than sixteen different cities in the region are described in a report that covers the entire globe.

Kraków in Poland was described now as an ‘established’ location for offshore outsourcing, with the rest described as emerging, aspiring, or on the radar. Kraków and Dublin were the only European cities in the top ten on the Tholons list – with the other eight all being from Asia.

This is a great result for the CEE region in general. Tholons lists many cities across Asia and Latin America, but to find so many cities of interest to the outsourcing community all clustered together in Eastern Europe does demonstrate that a cluster of expertise is developing.

All the cities listed have the great advantage of being close to potential clients in Western Europe and being close to other great delivery centres in the CEE region. With some locations better at ITO and some better at BPO, it’s encouraging to see so many cities all in one single region.

With experts such as Tholons shining a new spotlight on Eastern Europe, it cannot be long before many other cities in the region start being recognised for their delivery capabilities too.

Outsourcing in 2013

IBA Group
Mark Kobayashi-Hillary

The analyst firm Horses for Sources is conducting their annual survey on the state of outsourcing in 2013. You can participate in the survey here and I would recommend adding your voice because this is one of the best annual summaries of what is going on in the sourcing industry.

One of the biggest changes I have observed over the past few years, and one that is accelerating at present, is a reduction of the offshoring concept – meaning that the world feels a lot smaller and that it is now normal to perform various tasks for a company in many locations.

If you go back a decade or more, an offshore IT delivery centre felt very much like it was in another location, a place where you might not expect senior executives from the client firm to be based. India is a good example – it was a low cost software production centre and executives only ever visited on business trips.

Eastern Europe is the same. There was a clear divide between where the clients were located and where the delivery centres were being developed. But this has all changed and Eastern Europe has changed much faster than locations like India.

It’s still a big journey for an American or European executive to get over to India and despite offshore delivery from India becoming common, there is still a clear divide once you arrive in the country and see a shining new software factory right next door to a slum.

It’s almost a decade now since countries like Poland and the Czech Republic entered the European Union and all these nations to the east now feel like an integral part of the continent – even more so now that the Eurozone is struggling. Ukraine grew over 5% last year and the Czech Republic almost 2% so these places to the east are really helping Europe as a whole.

We are already seeing a situation develop where Eastern Europe becomes a market for Western Europe to work with, rather than a place to locate lower-cost services. How long before it looks far more attractive to invest in the east?

Ukraine Steps Up the Heat

IBA Group
Mark Kobayashi-Hillary

New data from real estate experts Jones Lang LaSalle has indicated that Romania and Ukraine are becoming far more important players in the Central and Eastern Europe outsourcing market – challenging the more traditionally dominant Polish market.

Ukraine was highlighted in the research — the value of its IT outsourcing market hit $1bn in 2011, the Financial Times reported earlier this month, up tenfold in the last decade.

Among those major companies setting up in Ukraine, according to Kyiv Post, is Nestle, which recently opened a service centre — right across the border from Poland in Lviv.

You might ask why a real estate company is releasing data on the ITO and BPO industries and how they could be offering analysis on the growth of the hi-tech service sector. Growth in these markets needs people and offices and so one of the business areas with their finger right on the pulse of which region has the most interesting growth prospects is the commercial real estate sector.

They know where companies are investing before the companies themselves make a big noise about their own success – so markets like Ukraine are clearly now developing a momentum worth watching closely.

Poland may remain dominant in the BPO and call centre market, but this enormous growth in IT spending further east is a sign of where the smart money is heading.

Outsourcing and the US Presidential Election

IBA Group

Mark Kobayashi-Hillary

For the past few US presidential elections, outsourcing offshore has been a major topic of debate. Usually the rhetoric revolves around which potential president will be tougher on offshoring than the other.

At the last election there was talk of new tax hikes for companies purchasing services from other overseas companies – but of course nothing happened, this really is just electioneering.

The USA remains the most powerful economy in the world even after the financial meltdown starting reshaping world finances. American products produced by companies such as Boeing and Microsoft sell all over the world. These products are also developed all over the world – business today is a global network of companies selling products and services across borders.

The offshore outsourcing debate during US election campaigns has always been full of hot air, playing to a domestic audience that likes to think of American companies employing only American workers, but the world economy is no longer just concerned with domestic politics.

If Dodge wants to sell cars outside the USA they need to employ people in the markets where they want to sell. If Microsoft wants to ensure their products work correctly across all the major markets of Asia, they need to employ people in those regions.

And when it comes down to IT expertise, the USA has plenty of that – it’s the birthplace of every modern giant in technology from Google to Apple, but that doesn’t mean there is not technology expertise outside the USA. If an American company wants to employ the services of an IT expert outside of the USA then that’s their choice – it’s a straight decision based on competition.

And the USA remains a powerhouse so they should welcome international competition – it will only help them to raise their own game.

Is It Time to Stop Using the Word ‘Outsourcing’?

IBA Group
Mark Kobayashi-Hillary

Technology industry analyst HfS Research has launched a survey asking whether they should stop using the word ‘outsourcing’ in their coverage of the industry – and even whether the technology services industry should entirely stop using the word. Is it a dirty, tainted word?

Most involved in technology outsourcing have moved on from the old days of labour arbitrage or augmentation. Service providers like IBA don’t just pitch themselves as the cheapest offshore service providers; they position themselves as the experts in whatever they do. They promote specific areas of business and expertise.

The buy-side clients commissioning work (or outsourcing the work) from the service providers know that they are buying in expert services, usually services they could not perform in-house. They don’t want the cheapest provider – they want the best for their business.

But the political rhetoric has barely changed. As the US presidential election approaches, outsourcing is still considered a dirty word for politicians and a way to score a few cheap votes by patriotically insisting that they would ban it forever. But we all know that US politicians say this at every election.

These same politicians probably calculate their budgets using Microsoft Excel and broadcast information using Cisco services. They fail to see that any large technology company is already working with global resource and any company starting today with a need for some technology development will consider hiring suppliers from all over the world.

It’s not that outsourcing is about shipping work off to cheap economies; it is that the Internet has created a global marketplace. If the marketplace is global then that can create both problems and opportunities back at home, but how come the politicians rarely focus on the opportunity of small niche companies being able to reach a bigger market?

So do you agree with HfS? Is it time the industry stopped using the term outsourcing and if so, what would be better word to replace it?

Texting in the UK

IBA Group
Mark Kobayashi-Hillary

The British communications regulator Ofcom just published a new analysis of telecommunications in the UK and there were some interesting results. After years of constant growth, Britons are now making fewer calls on their mobile phones, but the number of text messages sent has increased dramatically.

So the British are texting more and speaking less – is it significant?

It shows a marked change in the way people are communicating today. For instance, the survey notes that 58% of British adults send at least one text message a day, yet only 49% engage in a face-to-face conversation on a daily basis.

The argument for texting is easy – it is an asynchronous mode of communication. In short, I can send a text and not worry about disturbing the person, they can respond in their own time. A call is intrusive – it demands immediate attention. I personally ignore my telephone if I am busy with work because to endlessly be picking up the phone each time it rings would mean I never actually achieve a thing – other than answering calls from people who assume I am free to talk.

But it is significant to see that the number of calls is actually dropping and it is a worry for the mobile phone industry. They don’t make much money on texts – they are usually bundled into a contract, so voice calls are dropping and many are learning how to use their 3G connections to make a call bypassing the phone company.

But the most shocking news from this survey has nothing to do with phones at all. Can it really be true that half of British adults do not have a conversation with another person for an entire day? Maybe they should pick up the phone and call a friend…

Everest Research Says Eastern Europe Is the Place to Watch

IBA Group
Mark Kobayashi-Hillary

The research and analysis company, Everest Group, just published their latest Market Vista: Q1 2012 report – a quarterly focus on global outsourcing and offshoring activity and it shows that despite troubled times in many business markets, outsourcing is holding steady.

First quarter global transaction volumes reached about US$3bn in annual contract value (ACV), an increase of 11 per cent over the previous quarter. Compared to Q4 2011, the global market saw a 9 per cent increase in Business Process Outsourcing (BPO) transactions while IT Outsourcing (ITO) transaction volumes remained about the same.

83 per cent of the deals signed were new transactions showing that there is still plenty of business coming through – it is not just about companies renewing their existing outsourced contracts.

Some key points noted in the new report include:

• BFSI (banking, financial services and insurance) sector leads the market in transaction volumes with an increase of 12 percent while the MDR (manufacturing, distribution and retail) vertical saw a 9 percent increase. Transaction increases also were recorded for public sector, energy and utilities, and telecom verticals, but the healthcare vertical saw a large drop in deals signed during the quarter.

• Transaction volumes decreased in North America, held steady in the United Kingdom and increased significantly in Rest of Europe.

• Offshore activity saw 30 delivery centres established across captives and service providers in the first quarter compared to 29 in the previous quarter. With significant activity occurring in Latin America and Eastern Europe.

This latest research shows that the offshore outsourcing market remains strong, despite economic and business uncertainties in the market today. It is also worth noting that Everest see significant activity in Eastern Europe – this is a key region to watch at present.

IBA Choir Performs at Minsk Philharmonic Society

On June 3, a joint concert of the IBA’s choir Concordia Chor and the Swedish choir Boo Cantabile was conducted at the Minsk Philharmonic Society. The concert was organized within the framework of the 3rd international festival of amateur choirs Guki Leta (Sounds of Summer), and with support from the Embassy of Sweden in Belarus and the Belarusian Union of Musical Workers.

The concert consisted of two parts. In the first part, the Swedish choir performed under the management of Helena Engardt and in the second, the IBA’s choir conducted by Galina Kazimirovskaya.

See video of Boo Cantabile

See video of Concordia Chor, solo by Grigory Zasmuzhets

See video of Concordia Chor

See video of Concordia Chor singing with Boo Cantabile

IBA Choir Performs at Minsk Philharmonic Society

IBA Choir Performs at Minsk Philharmonic Society

IBA Choir Performs at Minsk Philharmonic Society

IBA Choir Performs at Minsk Philharmonic Society

IBA Choir Performs at Minsk Philharmonic Society

See more pictures at IBA Group’s Facebook page

The Technology Olympics

IBA Group

Mark Kobayashi-Hillary

It is a mere two months to the start of the London Olympic games, an event that has cost at least £9bn to stage, with a large part of that budget taken up in infrastructure costs, including technology.

But one of the most interesting technological aspects of this event is that it will be the first ever Olympics where social media is a part of the event and will help to form the opinion of a global generation.

It is true that tools like Facebook and Twitter were around for Beijing 2008, but they had not reached the ubiquity of today and tools like the iPhone were still in their infancy. Right now you can use Twitter to follow the chairman of the London 2012 Organising Committee. You can follow the athletes as they train for the games and even ask how it is going. You can ask the pundits for their predictions and get involved in planning how you are going to watch the games – whether it is the big screen in Hyde Park or down the pub.

Can you just imagine how many smart phone photographs are going to be uploaded on the 3G networks around the London Olympic stadium in the seconds and minutes following the 100m sprint final? I guess there will be at least a million photos of that single event uploaded – how many more photos and video from London can we expect during the games itself?

London is going to be special for this reason. It is going to be the first truly interactive games where the people will broadcast the event – not just a presenter in a TV studio talking to passive viewers. This will be the biggest backchannel of conversation, speculation, and debate ever witnessed – and it’s all going to be driven by London, showcasing our capital city to the world.

Although we often think of the technology around the Olympics in terms of contracts to big companies to build communications infrastructure, at this event it is going to be all about the people watching the games, rather than those on the track.

IBA and Modern Art Museum Launch Exhibition of Collages

On May 2, IBA Group and the Modern Art Museum of Belarus opened an exhibition entitled Hanns Baum: 18 Years in Belarus. Collages. Assemblages. The exhibition features selected works by the German artist Hanns Baum who spent 18 years in Belarus working as IBM coordinator at IBA Minsk, the largest development center of IBA Group.

See a series of video clips (in Russian and German) of the opening event and the press conference.

Valentin Kazan, IBA Vice president, introduces Hanns to journalists at the press conference.

Natalia Sharangovich, museum director, says that Hanns’ works are a reflection of Belarusian reality and introduces Sergei Levteev, IBA president, who recalls the changes that have happened at IBA since Hanns first came to Belarus.

Hanns Baum describes his works and creative process.

Zinaida Britch, a veteran of IBA, speaks about the influence that Hanns’ creative work had on IBA employees.

Hanns speaks about Minsk when working on assemblages.

Hanns gives a master class 🙂

Hanns gives portraits to IBA co-workers

Installation

Press conference

Valentin and Hanns

Press conference

Sergei Levteev

Hanns Baum

Zinaida Britch

Natalia Sharangovich

See more pictures of the event and Hanns’ works at IBA Group’s page on Facebook

IBA outsourcing and the crisis in Europe

IBA Group
Mark Kobayashi-Hillary

Back when the global economic crisis started, many industry commentators declared that this would be a boost for the international IT outsourcing market. With companies in Europe and the US struggling to ride out the downturn, there would be strong growth in offshore outsourcing.

But things never really played out like that. Outsourcing usually needs a big upfront investment in training, knowledge transfer, and additional management to make the transition run smoothly. Many companies just decided to avoid that short-term investment even if it was clear that there would be benefits in the long-term.

We are not out of the woods yet, but there is more stability. The US is growing slowly now and many countries in Europe are seeing promising growth – though the uncertainty of the Euro is still causing many to fear for the immediate future of the Mediterranean economy.

Research and consulting company, Everest Group, in a recently published research suggested that outsourcing in Europe was worth €180-200bn in 2010. Their latest research for 2011 is not published yet, but estimates suggest that this figure will have increased to about €220bn. This is about a 10 per cent increase in demand even in quite an uncertain economic climate.

Industry observers suggest that much of this new demand is because companies in France and Germany are starting to explore a more global delivery model. In the past they were far more resistant to offshoring, but today it has become a strategic necessity, regardless of the global economic situation it is just how technology is delivered today.

All this is good news for those of us who have been delivering remotely all along, right through the economic crisis. Whether companies are exploring offshore outsourcing because they need to reduce their cost, or they just need to find more expertise and faster, we know exactly how to help.

The power of Tivoli

IBA Group
Mark Kobayashi-Hillary

The IBM Tivoli Management Framework (known as the TMF) is a systems management platform from IBM. It was originally a separate company and product, but IBM purchased Tivoli in the nineties and the product has been developed extensively since then within IBM’s software division.

The TMF is designed using a CORBA-based architecture and its real strength is that it can be used to manage a large number of remote devices in a very robust way.

Tivoli is an entire framework of tools that can be linked, rather than just a single software product, so it is very powerful and can be used in many ways. There are endless different ways in which the tools can be integrated to deliver a solution.

At IBA, we recently delivered a solution to a client that involved us connecting these tools together to create a fully integrated system:

• Tivoli Network Manager; the tool to help visualize and manage a complete network.
• Tivoli Netcool/OMNIbus; the tool that provides a complete operations management infrastructure, including the ability to identify and correct critical network issues.
• Tivoli Netcool Impact; an intelligence tool that adds context to events, helping you to manage events on the network and using intelligence to determine whether an event is critical or not.

Even this short example alone gives you an idea of the power of Tivoli. It is not just about visualizing your network with a series of graphical representations, but about adding a layer of intelligence into the network itself – almost like a self-healing network so your team only needs to manage the critical issues.

To those not involved in managing networks all this might seem quite dull, but every company needs their network to be up and running and as reliable as possible, business doesn’t happen without it, so the team keeping the network running are really ‘keeping the lights on’ at your business. Do they have the right tools for the job?

IBA Group Wins European Software Excellence Award 2012

On March 1, IT Europa announced the winners of the European Software Excellence Awards 2012 in Berlin, Germany. IBA was selected the winner in the category Database Solution.

IBA Group entered the contest for the fourth time and won for the second year in a row. In 2011, the award was in the Relationship Management category.

We were pleased to be in the same company with world IT leaders. The recepients of awards in other categories were Oracle, Fujitsu, and other reputable companies.

Watch a video clip of the award presentation.

IBA's Soupeev gets prize from sponsor - FujitsuYauheni Soupeev, IBA department headEuropean Software Excellence Award. IBA's trophyAward-winning IBA team

Mobile Applications

IBA Group
Mark Kobayashi-Hillary

Mobile devices are exploding in popularity – tablets and smartphones are now outselling the regular PC. But the consumer, not the enterprise, has led this revolution in how we consume computing systems.

The growth in popularity of the app store concept – initially dominated by Apple, but now with Android also being important – has changed our expectation of what it means to use a computer. The system must be easy to use, to configure, and to maintain. Remember when installing applications was something that had to be planned? Now you can just do it to try something out and then delete it if it is not useful.

The phones and devices running these tools feature a number of sensors and gyroscopes – they know exactly which way up they are and where in the world they are being used. This has opened the world of computing far beyond what anyone could have imagined – even just five years ago. Imagine trying to describe the Google skymap application to someone five years ago – they would never have believed that a mobile phone could be capable of complexities like augmented reality – that kind of technology was only for the military.
But how is all this changing life inside the company? There are two major problems for the CIO or technology leader:

• People have better technology in their pocket than the PCs supplied by the company. Why would they want to use an old desktop PC running Windows when their phone or tablet has better applications and is easier to use?

• If people have better technology of their own, and would prefer to use it in the workplace, then how can all these mobile tablets, phones, and applications be managed within the regular enterprise network?

Not only is there a problem of work culture developing in many companies, but also there is a security risk. Staff insisting on using their own technology need the support of a CIO who puts realistic governance plans in place to secure the company network, without preventing them from using the tools they prefer.

The company that gets this right will not only have happier staff, but also more productive and efficient – and why not give the staff a cash bonus for using their own technology too?

2012 is Going Mobile

IBA Group
Mark Kobayashi-Hillary

When a company like Intel reorganises itself around mobile technologies, it is clear that something has changed.

And this is no surprise. Take a look around at how IT is being consumed today and it is clear that there has been a mobile revolution. According to the latest Gartner forecast, worldwide tablet sales will reach 63.6 million units in 2011– a 261.4% increase from its 17.6 million sales in 2010. Tablet sales are expected to reach 326.3 million units by the end of 2015.

So the world is organising access to computing power through tablets and smart phones much more than ever before – not through desktop PCs or even laptops.

The smartphone and tablet revolution may have started with consumers, but it is moving into the corporation. Many businesses are actively exploring how to increase productivity through the use of tablets – and they are about to become more popular than the regular PC.

Gartner estimates that the combined sales of smartphones and tablets will be 44% greater than PC sales this year, and by the end of 2014, the installed base of computing devices running mobile operating systems will surpass the total installed base of all PC systems.

That’s just two years away – more mobile devices than traditional PCs installed around the world. With such a change in hardware there is also a need for new software too and experts who really understand how to write code for tablets.

Porting old code can work, but doesn’t exploit the power of the tablet. The real winners will be the companies that realise not only what the hardware can do, but how to write new forms of code that take advantage of this new mobile business paradigm.

Companies explore Eastern Europe for IT and software development

IBA Group
Mark Kobayashi-Hillary

In my last blog here, I outlined how a need to spread risk has led to a marked increase in companies exploring the CEE region for their IT and software development needs. But the growth in outsourced services available from the CEE region is not restricted to IT alone.

The region has highly educated people working within the service sector meaning that there are many BPO opportunities in the region. Many organisations – such as international giants like DHL – have setup very large operations serving the whole of Europe from a CEE base in a variety of different business processes.

But now there are even international lawyers exploring the region for Legal Process Outsourcing (LPO). This story in The Lawyer magazine about US law firm White & Case exploring the relative merits of Poland, Hungary, or the Czech Republic is just such an example.

White & Case already have resource in the Philippines, but are worried about their entire back office being located offshore in a single location – just like many of the IT firms that have explored a risk diversification strategy.

Every executive responsible for outsourcing needs to consider both natural disasters and political risk when locating a function offshore. Though many companies explore outsourcing as a means of reducing cost, if the offshore function fails entirely then it won’t be cost savings that are under discussion, it may be how to save your company.

It is clear that the IT sector in CEE has expanded allowing entrepreneurs to start offering many IT-enabled BPO services. All these new services help the local CEE economy to develop as well as offering a great place for companies to locate new services and to reduce their own risk.

CEE is more attractive than ever as uncertainty looms

IBA Group
Mark Kobayashi-Hillary

When the global financial crisis struck the world in 2008, many predicted that there would be a boom in offshore outsourcing. It didn’t really happen.

Why? Because at that time most companies slashed all project budgets and retrenched employees. It was a time when nobody was certain of what the future would bring and it costs money to run outsourcing projects – even if they can create longer-term savings. Nobody wanted to invest all that money in setting up in a remote location hoping for gains in the future.

We are once again in an uncertain time, but this time there is a far more mature option for sourcing in the central and eastern European (CEE) region. The setup costs for running a project in the CEE region are far lower than for a full-blown offshoring programme where work needs to be transferred to India or China.

So there is a much more credible alternative available if companies in western Europe are seeking to stabilise costs in the short-term and build a pan-European delivery model for the long-term.

The CEE region has never tried to compete head on with countries like India in terms of absolute labour cost, the advantage has always been the cultural compatibility with Europe, the expertise, and the ability to be close to the customer – it’s possible to make a day trip to a development team from any other place in Europe.

And now, with the economy looking uncertain once again in both the US and Europe it seems that the nearshoring option is looking far more attractive than the full offshore model, because much less initial investment is needed to make it happen.

We have been talking about the advantages of CEE for a long time on this blog, but it is interesting to see that the issues in the wider European economy are making it even more attractive to work with the region. Have you taken another look at how nearshoring compares recently?

The age of the CIO as IT leader is over?

IBA Group
Mark Kobayashi-Hillary

IT is changing fast and it can be hard to keep up, but companies in the IT services business know that one thing is certain, the role of the Chief Information Officer (CIO) is changing fast.

The Chief Financial Officer (CFO) is becoming more involved in technology decisions in many companies as IT moves itself more closely to the business across all industry sectors.

It’s no surprise. Think for a moment about the big difference between Business Process Outsourcing (BPO) and IT Outsourcing. With BPO, the person commissioning the work is a business leader, the head of finance, the head of HR, the head of operations… they don’t really care about the underlying technology. They just want to buy a solution that works for their business.

Now think about IT services. IT suppliers have worked with the CIO for many years – selling solutions to the technology head. Yet the role of the CIO seems to have changed during the economic slowdown. Companies require their CIO, CFO, and business leaders to work more closely than ever in ensuring that the business benefits from the decision made by all the executives.

Take a look at what IT expert Angelica Mari says in her book ‘Reboot: Leading IT in the information age’: “The CIO is quickly losing their traditional power base focused on the ownership of physical assets. The basement stuffed full of ‘kit’ is no more. In this environment, only the fittest – or smartest – will survive.”

But why has this change taken place? The past couple of years have been tough for everyone. The role of the CIO has evolved and changed because IT has become more important than ever – in all industries.

In travel, it’s probably CRM that is the most important investment right now. In government it is technology that can reduce transaction costs… In most industries, IT has become so pervasive that the companies could not operate without it. So, with IT becoming more strategic than ever, how come many industry analysts believe that the age of the CIO as technology leader is over?

Outsourcing to help Europe return to growth?

IBA Group

Mark Kobayashi-Hillary

In the past three years or so, since the initial credit crunch and then global economic slowdown, outsourcing as a business strategy has taken a knock.

It’s not that there is anything wrong with it as a strategy. It’s just that outsourcing usually involves change, some change in processes and the way things are done. That needs planning and transition, so even if the future state saves money, many firms have declined to go through the process of getting there while survival has been the priority.

If you look back to the time around 2008/2009, most firms were probably focused on budget revisions, retrenching people they cannot justify keeping, and targeting business activities to those that create the most immediate return – completely focusing on getting through the recession.

But talk to most firms today and there is a more interesting and positive picture emerging. There remains the fear of a double-dip recession in countries such as the UK, and Germany is starting to struggle under the weight of supporting the Eurozone, but the major economies of Europe have been growing again – albeit slower than we used to enjoy. There is certainly a growth in business optimism and a greater desire to spend on improving company operations.

Firms are exploring how best to ride the growth when it comes, and that does involve a large amount of planning how to work with partners. The focus is now on positioning a trusted group of partners together and aiming for growth over this decade.

The biggest change in behaviour will be the desire to leverage existing assets over the next couple of years. When firms have already sunk cash into developing expertise and systems in-house, they won’t just discard that knowledge overnight.

It’s been a tough time over the past couple of years, but the new decade looks like an exciting place to be and outsourcing within Europe is going to be an important business strategy that helps us all return to growth.