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 |  | | Time to rethink offshoring? | | McKinsey on Business Technology, Winter 2008
Ajay K. Goel, Nazgol Moussavi, Vats N. Srivatsan
The production of high-tech goods has moved steadily from the United States to Asia over the past decade. The reasons are familiar: lower wages, a stable global economy, and rapidly growing local markets. These factors combined to make nations such as China and Malaysia favored manufacturing locations. In the past two years, however, the favorable economic winds that carried offshoring forward have turned turbulent. The new conditions are undermining some of the factors that made manufacturers of every stripe, including those in high tech, move production offshore. | Launch this article (PDF - 228 KB) |
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| | | From internal service provider to strategic partner: An interview with the head of global business services at P&G | | McKinsey on Business Technology, Fall 2008
Filippo Passerini, the head of P&G's global business services (GBS), describes how his organization evolved to become a strategic partner with the company's operating units.
He explains that the consolidation of dispersed local support units, the outsourcing of nonstrategic service functions, and the blending of IT with other services helped the company to cut costs substantially and gave GBS a new role as a provider of innovative solutions in customer interactions and product development.
The new challenge, he says, is to adopt a project-oriented work style as GBS takes productivity and IT-driven innovation to the next level.
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| | | The Overlooked Potential for Outsourcing in Eastern Europe | | McKinsey on Business Technology, Winter 2006
Eastern Europe is a small player in the global market for IT and business process outsourcing, but that’s likely to change as companies in Western Europe become more comfortable with offshoring. Service providers in Eastern Europe offer geographic proximity combined with cultural and language affinities that Western European companies can’t easily find further afield. The region is likely to remain competitive, given its low level of wage inflation (outside of popular centers like Prague and Budapest), along with thousands of qualified graduates entering the marketplace each year. As Eastern European service providers develop their capabilities, they should capture a larger share of the market for IT and business process services. | | Launch this article (PDF - 163 KB) |
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| | | When IT’s Customers Are External | | McKinsey on Business Technology, January 2006
For customer-facing IT projects, failure can have serious long-
term consequences. To minimize the risks, IT organizations
should adopt the market-oriented approach of software product
companies, which must excel at bringing new products to
market at a competitive price. A market-oriented approach is
customer-focused, involving front-end market research, back-
end customer support, and controlled customization. For this
approach to work, a company’s IT function must reengineer the
software development process, and partner with marketing and
sales. | Read more on the McKinsey Quarterly site |
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| | | Pharma Leaps Offshore | | McKinsey on Business Technology, Summer 2006
The pharmaceutical industry stands to benefit at least as much as other industries from the opportunities of offshoring. Low labor costs offer the prospect of more efficient and successful clinical trials and also offers opportunities to gain better insights about sales trends by analyzing sales and marketing data more closely. This article shows how leading-edge pharma companies are making the most of global resourcing. | | Launch this article (PDF - 1.172 MB) |
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| | | Running a Customer Service Center in India: An Interview with the Head of Operations for Dell India | | McKinsey on Business Technology, Summer 2006
Dell Computer says that it is so encouraged by the talent it is finding in India that it plans to double its workforce there during the next four years. In this interview with McKinsey on Business Technology, Romi Malhotra talks about the lessons he learned in recruitment, retention, and career development—lessons that have made Dell an employer of choice in India’s competitive labor market. | | Launch this article (PDF - 852 KB) |
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| | | Building a Global IT Network: An Interview with DHL's Managing Director for IT | | McKinsey on Business Technology, Summer 2006
DHL and its parent company, Deutsche Post World Net (DPWN), have developed a leading-edge model for IT development and operations. Three consolidated centers work around the clock, passing along activities from Malaysia to Prague to Scottsdale. In this exclusive interview with McKinsey on Business Technology, Stephen McGuckin, DPWN’s managing director for IT, explains how his organization developed this idea—from a single outsourced data center in Asia to the present global operating model. | | Launch this article (PDF - 1.799 MB) |
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| | | Benchmarking India's Business Process Outsourcers | | McKinsey on Business Technology, Summer 2006
McKinsey and India’s National Association of Software and Service Companies (Nasscom) have developed a suite of benchmarks to gauge performance by assessing the views of customers, employers and managers, and weighing the relative importance they place on various activities. The results of the first round of benchmarks suggest that while customers are happy with the cost savings they get in India, they are now looking for more innovation and higher productivity from their partners. | | Launch this article (PDF - 172 KB) |
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| | | Smart IT spending: Insights from European banks | | McKinsey on Business Technology, January 2006
A recent McKinsey survey of 37 European banks shows that a
few spend less on IT but get more business value than banks
that spend far more. The top performers focus on a few key
IT management levers to achieve getting more for less,
including in areas such as managing application portfolios,
data centers, and desktops. Other best practices include
improving customer access to bank services, and spending
more on core processes like securities handling and
mortgage processing instead of back-office functions. The
survey categorized four IT spending profiles, and offers
strategies for improving the value that IT investments deliver. | | Read more on the McKinsey Quarterly site |
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| | | Will Europe Embrace Offshoring? | | McKinsey on Business Technology, Fall 2005
Offshoring hasn’t taken hold in continental Europe because of language differences, labor laws, and political opposition. But, companies on the Continent now have an opportunity to capitalize on offshoring and correct their growing cost disadvantage in many sectors. | | Launch this article (PDF - 277 KB) |
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| | | Can China Compete in Global IT Outsourcing? | | McKinsey on Business Technology, Spring 2005
When it comes to things economic, China seems to be overshadowing everyone else in the region. But can it start capturing some of India's lucrative IT services trade? A close look at China's IT industry shows that it must overcome many obstacles before the country becomes a threat. China is unlikely to take a major share of the global outsourcing market until the country's IT industry consolidates and addresses such issues as software quality and piracy. Only then can it hope to draw attractive international contracts away from India. | | Launch this article (PDF - 146 KB) |
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| | | IT Shared Services: Learning from the Market | | McKinsey on Business Technology, Winter 2004
Shared services is on the minds of companies because it can help save money. The idea is not new. What’s new is the realization that companies need to make sure their shared services meet the needs of the market, not just internally but externally as well. They need to figure out if their model would be competitive if it was set out on its own. | | Launch this article (PDF - 147 KB) |
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| | | Reaping the Benefits of Business-Process Outsourcing | | McKinsey on Business Technology, Fall 2003
Outsourcing business processes can significantly boost a company's performance -- but only if companies do the homework needed to make the deal work.
| | Launch this article (PDF - 88 KB) |
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