EDS pushes banks to offshore

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.

SHARE:
TOPICS: India
9
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."

Topic: India

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

9 comments
Log in or register to join the discussion
  • Right shore

    What a nice fluffy term for offshoring! No wonder he gets paid the big bucks.
    anonymous
  • Sack Of Crap

    This is Bull$%$%.. I paid over 120 grand for college to be told i can't have a job because all the computer realted jobs are being off shored.
    WTF .. I want my Time and Money Back.
    anonymous
  • What a pointless speech

    Erm...thanks for the comments Chris Mitchell, but I'm sure the banks are already looking into this!
    anonymous
  • Outsoursing to offshore

    Did any boses try to use it - my first hand experience it is complete waste of
    tome and money:

    1 You calling - nobody could not
    understand them - and I am not even talking of technical thing.
    2 Expertise is questionable - even if you pay 5 $ hr - it is 5 $ wasted.
    What is the point to hire cheap labour if they could not do the job properly
    and customers are not happy??
    When accountants run computer business what could you expect ???
    3 Majority money from contracts coming to
    outsorcers - a lot of managers getting paid huge money for all this "projects"
    going forever till them bust - I've seen it too many times.

    THE WORST THING COMPUTER PROFESSIONALS
    DONT HAVE UNION OR AMY PROTECTION -
    A BIG CRY 50 PEOPLE LOST JOBS ( OR
    WE ALL PAY FOR ANSETT DEBTS - WHY IS
    ANYBODY ELSE IS NOT PROTECTED) - THE
    WHOLE INDUSTRY DIED - THOUSANDS OF PEOPLE
    LOST JOBS/INCOME AND WHAT ??
    WHO IS PROTECTED THEM - HOWARD ?
    lABOUR ?? ANYBODY ???
    FULL SILENCE
    anonymous
  • Banks better wake up.

    Offshoring!!! Unemployment lines stretch round the block, people in Australia can't find work as it's all going overseas. Thousands are being made redundant every year. The people don't have any money to put in the banks as they don't have the income any more. How do the banks expect to make any profits if no one is using them. Banks are putting themselves out of business and hurting the whole countries economy in the process. People like this Mitchell guy are the ones to blame for most of it as they are good at putting a spin on the whole industry to con the bank managers into believing it's the best thing for them to do. Can somebody in management actually think for themselves instead of getting these consultant con men in who charge a fortune to give them the wrong advice?????? Come on people at the top, wake up and see what's happening in the real world instead of sitting in our Ivory towers with your million dollar salaries and thinking how wonderful the place is. Most people are suffering badly and can't make ends meet no matter how hard they try.
    broozer@...
  • Mitchell's speach was for Mitchell only

    Only Mitchell really knows why he made such a useless speech.

    So long as their is accountability for managerial actions, its okay.

    For example, Quantus are now saying they don't have enough people skilled to use their ageing legacy systems.

    Why? Because they got rid of them all, and they're now thinking they can find them in India.

    A couple of years ago a Quantus Exec stated that they should sack their IT team and hire graduates.

    Now it sounds like they need them back.

    Stupid, of course!

    Can somebody please get sacked over this!
    anonymous
  • Do something about it

    Guys, stop whinging and do something about it. Dont cry that you don't have a job and the banks should employ you instead. You must hit them where it hurts most - their bottom line. Simply move all your bank accounts to other banks and leave ANZ, CBA, tell all your family and friends to do the same and make sure everyone writes an email/letter to their bank manager telling them about this. The only way corporation will listen is if they are hurting. You too can play their game!
    anonymous
  • Talk it up chump...

    No one who actually "works" in the industy agrees with you. You might save yourself alot of money on paper which always looks good on a projections graph for the shareholders, and gets you that fat bonus. We all know the REAL human cost to the clients your supporting.
    anonymous
  • Not cheap labor.

    Offshoring to india seems cheap to us. however in india these call centre staff and It pro's are actually some of the most well paid professionals. The unfortunate reality is that it is all realtive. If a litre of milk costs 2 cents in india and we pay them $5 per hour then they can live like kings. If you or I were to move to india and perform the same job our standard of living would be higher than living here in australia.

    There isn't a lot that can be done about this. you can put up labor laws saying that this cannot be done, but the truth of the matter is that will only make it worse for us. we will be forced to take less money and poorer conditions to make up for the loss. a union movement would help but only in comparable jobs, there is NO standards for jobs like programmers or system admins who have varying skills and their salaries will vary depending on them.

    maybe ill move to india and get a nice house and car, work 4 days a week and get free gym/health care/cafeteria.
    anonymous