EDS pushes banks to offshore

Summary:Outsourcing giant EDS has pressed banks to offshore more IT services to destinations like India, with local managing director Chris Mitchell telling top bankers that offshoring more backoffice operations was the answer to remaining competitive.Speaking at a conference that included several chief information officers of the big four banks in Sydney, Mitchell said the case for offshoring was inevitable.

Outsourcing giant EDS has pressed banks to offshore more IT services to destinations like India, with local managing director Chris Mitchell telling top bankers that offshoring more backoffice operations was the answer to remaining competitive.

Speaking at a conference that included several chief information officers of the big four banks in Sydney, Mitchell said the case for offshoring was inevitable.

"We're moving to a world where knowledge work can be delivered from anywhere," he said. "There's a whole range of capabilities that can be done from anywhere in the world.

"It's not about offshoring anymore. It's about the best location for the best work," he added.

ANZ Bank currently leads offshoring among Australian banks. It employs 650 employees in Bangalore, India, and will expand the pool to 1,000 in the next 18 months.

EDS has contracts with a number of the major banks; the most prominent being a AU$5 billion, 10-year technology services sourcing deal signed in 1997 with the Commonwealth Bank -- which is expected to announce an offshoring deal with Indian IT services multinational Infosys in the coming months.

In addition to rejecting the "offshore" term, Mitchell tried to combat common perceptions of the practice.

Business shouldn't look at "right-shoring" as establishing a vendor partnership, he said. Instead, they should see the chance to use "constituents" to help deliver that work.

"I'm not a great fan of the word partner, I think it's a very abused word," Mitchell said.

"We have to think about how we change the dialogue so we have a sustainable workforce," he said, putting the emphasis on skillsets.

Mitchell showed off the cost benefits of using offshore destinations like India, and said these couldn't be achieved through other means. "As some of these markets globalise and you're competing against companies with operations spread around the world, you've got to think about your efficiency and how you're delivering that."

Topics: India

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