From:	Baroni Limited [Baroni-Limited@tiscali.it]
Sent:	28 March 2008 17:11
Subject:	Baroni Limited - Offshoring Newsletter' - 04/08

India Headlines
## 2008 Estimates for Pay Hike.
The pay hike estimates for Indian employees stand around 15.2% as per a survey by global human resources company Hewitt Associates. In 2007, Indian employees received an average salary hike of 15.1%, the highest across 14 Asia-Pacific countries. 2008 would mark the fifth consecutive year of double-digit growth of salaries in India. However, it is estimated that salary hikes would gradually decrease and stabilize around 9-10% by 2012. Real estate will head past retail and telecommunication to witness the highest salary rise at around 25% in 2008. The ITeS sector would record the lowest pay hike at 14%.
## IT Firms To Cut Onsite Allowances Of Employees To Reduce Costs.
Staff of Indian IT services companies deployed at clients’ offices in North America will now feel the heat of imminent recession in the US. Most Indian employers are set to cut the onsite allowances of employees by 25 to 30% from April 01, 2008. Each company has a different method of paying the salaries of onsite employees. For most employees, posted onsite, major savings come from their daily allowance, which makes short stints abroad an attractive option. A cut in these allowances is likely to serve a blow to morale of employees who look forward to such postings. Generally, onsite workers in Europe or Japan earn more daily allowance than those in US, but the cost of living in these geographies is higher than in the US.
## IT Firms Slashing Cut-Off Percentage For Freshers.
Giving a certain advantage to engineering students, top companies are increasingly lowering the cut- percentage to hire freshers and opening up job offers to not so popular streams as well. The eligibility criterion for the selection of placements has been reduced from 58% to 55%. Apart from just reducing the percentage bar, some companies such as Accenture are also hiring graduates from electrical engineering, chemical engineering, civil engineering, metallurgy, instrumentation, automobile engineering, production and other related streams as associate software engineer. Apparently, the growing demand for engineers has led to such flexibility of attitude among IT firms.
## More IITs To Tackle IT Manpower Shortage
With growing business and expanding horizons, the Indian IT industry is feeling the heat of man power shortage. To overcome this dearth of talent, government is taking significant steps to provide quality engineers in the IT industry. In the Union Budget 2008-09, government has announced that three Indian Institutes of Technology will be set up in Andhra Pradesh, Bihar and Rajasthan and 300 more ITIs will be upgraded with an investment of Rs 750 cr. Also, the Ministry of State for Human Resources Development is taking various positive steps. It started finishing schools for unemployed engineering graduates to prepare them for IT and ITeS industry in the current financial year.
##Govt Incentives To Create More Jobs For Disabled In Pvt Sector
The Ministry of State for Social Justice and Empowerment has approved incentive schemes to generate 1,00,000 employment opportunities a year for the physically challenged persons in the private sector. Under the scheme, government will take care of the employer's contribution to Employees Provident Fund (EPF) and Employees State Insurance (ESI) for providing employment for the first three years to persons with disabilities. The scheme is valid for persons with monthly income up to Rs 25,000. It covers all persons with disabilities defined under Disabilities Act, 1995 and National Trust for welfare of persons with Autism, cerebral palsy, mental retardation and Multiple Disabilities Act, 1999.
##The rural experiment - One company is springing up BPO in India's rural heartlands.
Lason India, a subsidiary of the $167-million BPO firm Lason operates in the lower end of the BPO business. A big chunk of its revenue comes from high-volume, low-value services like data capture, data and document management, etc. Nearly a year back, Lason unveiled a major small town initiative - wherein, its business associates set up centres in Pondicherry and Kancheepuram. Today, about 1,000 people work in these centres. Another 3,000 will be added in similar centres to come up in Salem, Tiruchy, Madurai, Villupuram, Mysore, Vijaywada and Kanyakumari . This has helped Lason bring down employee costs. Now, Lason has started a experimental centre in a village wherein its business associate employees 14 people who works on low-skill work that can be done by anyone who can read and write English. 'If we can offshore work from USA to Chennai, I don't see why we can't move it from Chennai to Village Thiruvallur' says Pradeep Nivedita Managing Director Lason India.	

 	
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 HYPERLINK "http://www.qas.co.uk/company/data-quality-news/outcomes_as_important_as_cost_in_outsourcing_916.htm" More organisations are using IT outsourcing to enhance business performance - Gartner
According to a 2007 Gartner survey of 750 IT and outsourcing executives in North America, Asia/Pacific and Europe, 41% of organisations which are currently outsourcing IT use ITO to enhance business outcomes and performance. In 2005 only 28% of respondent reported enhanced business outcomes and performance as the primary benefit of ITO. Approximately 47% of organisations still identified controlling or reducing costs as the primary benefit expected from ITO.
 HYPERLINK "http://economictimes.indiatimes.com/UK_manufacturers_look_to_India_to_meet_skills_shortage_/articleshow/2832722.cms" UK manufacturers look to India to meet skills shortage
EEF South, the regional manufacturers' organisation representing members in London and south-east England, says more than half of the manufacturers in the region are looking outside the UK to find the skilled people they need to expand their businesses.
 HYPERLINK "http://www.computerweekly.com/Articles/2008/02/26/229573/it-managers-must-cut-it-costs-now-in-response-to-recession-says.htm" IT managers must cut IT costs now in response to recession, says Gartner
Gartner recommends that organisations begin establishing ground rules for complying with such a cost-cutting mandate by following a six-step plan: Step 1 - Do not wait for the cost-cutting mandate from management ; Step 2 - Choose the best and brightest IT people for the team ; Step 3 - Do not allow finger-pointing or second guessing ; Step 4 - Enlist an internal auditor as scorekeeper ; Step 5 - Report results on a weekly basis ; Step 6 - Identify a liaison from the legal department 
 HYPERLINK "http://www.pcworld.com/article/id,142436-c,currentevents/article.html" US Recession May Benefit Indian Outsourcers
Economic uncertainty prompts companies to delay contracts, but may soon benefit outsource services. Sudin Apte, senior analyst and country head for India at Forrester Research says Business will, however, pick up for Indian outsourcers by the fourth quarter, particularly if the U.S. economy is in mild recession. 'Our experience is that if the IT budgets of U.S. customers are marginally impacted in a recession, then there is an increase in business offshore, to cut costs,' Apte said. If the cuts are too large, whole projects can however get canned, he warned.
 HYPERLINK "http://www.computerworld.com/action/article.do?command=viewArticleBasic&taxonomyId=10&articleId=9063959&intsrc=hm_topic" Chrysler Consolidates IT Services With Multi-Million Dollar Tata Deal
Under the agreement made public this week, Tata will be responsible for a variety of IT systems at the automaker, including online vehicle ordering systems for dealers and maintenance of the company's dealer and brand Web sites, according to David Elshoff, a Chrysler spokesman. He said the consolidation under Tata will deliver greater efficiency for the automaker, but will not affect the jobs of any existing Chrysler employees.
 HYPERLINK "http://www.finextra.com/fullstory.asp?id=18132" Swedbank awards five-year outsourcing deal to LogicaCMG group company
WM-data has won a five-year contract for Swedbank's IT development and applications management. As part of the agreement, LogicaCMG will set up a dedicated centre for the bank within its operations in Bangalore, India.
 HYPERLINK "http://www.computerweekly.com/Articles/2008/02/20/229471/morrisons-signs-strategic-core-retail-platform-deal.htm" Morrisons signs strategic core retail platform deal
Morrisons plans to create a core retail platform to support its future growth. After identifying that its existing systems could not effectively support the company's plans for growth, the supermarket chain has entered into a strategic relationship with Oracle covering an extensive range of solutions, which include E-Business Suite, Siebel CRM Fusion Middleware including SOA Suite and Identity Management and a database.
 HYPERLINK "http://www.computerworlduk.com/management/government-law/public-sector/news/index.cfm?newsid=7911" Wiltshire County Council signs £12m LogicaCMG deal - Annual savings of up to £11m predicted
Wiltshire County Council has signed a seven year, £12m deal with IT services firm LogicaCMG to overhaul its internal business services and streamline front-line support. The programme will provide an IT backbone for five local authorities - Wiltshire County Council, West Wiltshire District Council, North Wiltshire District Council, Salisbury District Council and Kennet District Council - which will merge in April 2009. 
 HYPERLINK "http://services.silicon.com/itoutsourcing/0,3800004871,39170261,00.htm" Sharia insurance firm signs £87m Capita deal
A British Islamic insurance company is outsourcing its IT to Capita in an £87m deal. The eight-year deal will see Capita working with British Islamic Insurance Holdings (BIIH), which provides insurance compatible with the Muslim faith.
 HYPERLINK "http://services.silicon.com/itoutsourcing/0,3800004871,39170170,00.htm" Taylor Wimpey signs £30m LogicaCMG outsourcing deal - House builder aims to slash IT costs by 20%
The UK's largest house builder Taylor Wimpey has outsourced the management of all its IT systems to LogicaCMG in a deal worth £30m. The five-year outsourcing deal will involve the integration and management of all the merged Taylor Woodrow and George Wimpey company's IT systems.
 HYPERLINK "http://www.computerworlduk.com/management/it-business/it-organisation/news/index.cfm?RSS&newsid=7649" AstraZeneca hands £25m global network contract to BT
AstraZeneca has signed a £25m, five-year deal with BT for it to become the pharmaceutical giant's global network partner. The telco has been provided network services for AstraZeneca in Europe, the middle east and Asia Pacific since 2003. Under the new agreement BT will extend its platform to cover 33 new sites in the USA and Latin America.
 HYPERLINK "http://www.ciol.com/EC/News-Reports/3i-opens-Knowledge-and-Resource-Centre-in-India/10308104289/0/" 3i opens Knowledge and Resource Centre in India
3i, a world leader in private equity, announced the opening of a new Knowledge and Resource Centre in Bangalore, India, as a result of a partnership with Infosys BPO. 3i already has significant operations in India through its local growth capital and infrastructure teams, with recent investments including Nimbus Communications, a media and entertainment company focused on TV, advertising and sports rights, UFO Movies Pvt Ltd, the world's largest digital cinema chain, Adani Power, a 2,600MW coal fired power plant in Gujarat and the recent successful IPO of Mundra Ports, the deepest all weather natural port, on the west coast of India.
 HYPERLINK "http://www.callcentre.co.uk/c/portal/layout?p_l_id=259723&CMPI_SHARED_articleId=419981&CMPI_SHARED_CommentArticleId=419981&CMPI_SHARED_ImageArticleId=419981&CMPI_SHARED_ToolsArticleId=419981&CMPI_SHARED_articleIdRelated=419981" Prudential in Vietnam call centre outsourcing deal
Financial services company Prudential has signed a two-year call centre outsourcing contract with Harvey Nash, for its Vietnam business.	
 	
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 HYPERLINK "http://www.sda-asia.com/sda/news/psecom,id,19041,srn,4,nodeid,4,_language,Singapore.html" Study: Singapore Contact Centre Industry Lags in Becoming a Revenue Generating Industry
A recent study conducted by callcentres.net titled 2008 Asian Contact Centre Industry Benchmarking Report cited that merely 33% contact centres in Singapore can be considered as profit-making centres while the remaining are cost centres; Which is much lower than profit-making centres in other Asian markets including India (91%), China (79%), and the Philippines (72%); it is comparative to the developing markets of Malaysia (29%) and Thailand (12%) causing the country to lag behind other Asian countries. The study also revealed that the Asian contact centre industry is shifting from being traditional service and support-focused to service and revenue generation-focused.
 HYPERLINK "http://newsinfo.inquirer.net/breakingnews/infotech/view/20080303-122540/RP-needs-more-workers-to-sustain-BPO-growth--report" Philippines BPO growth--report
Advisory firm Tholons state Philippines remains strong in outsourced voice-based services but needs to have an adequate supply of skilled workers to sustain its growth. And estimates that 40% of the total BPO business in the Philippines comes from voice-based services
 HYPERLINK "http://economictimes.indiatimes.com/Infotech/Software/TCS_in_multi-million_euro_tie_with_Nokia-Siemens/articleshow/2830154.cms" TCS in multi-million euro tie with Nokia-Siemens
Networking major Nokia Siemens Networks (NSN) has signed a multi-million euro agreement with Tata Consultancy Services (TCS) to transfer its product engineering and R&D services as well as parts of the Operations and Business Software (OBS) business unit activities. The reassigned parts belong to the NSN development centre in Düsseldorf, Germany, including 90 employees who will be transferred to TCS as part of the agreement.
 HYPERLINK "http://www.washingtontechnology.com/online/1_1/32358-1.html" EDS consortium win $1.3 Bln Singapore ITO Contract
Under the terms of the IT outsourcing contract, the consortium will help the Singapore government achieve a standard desktop, network and messaging and collaboration environment across all government ministries, departments and statutory boards, the company said. The Infocomm Development Authority of Singapore awarded the contract.
 HYPERLINK "http://economictimes.indiatimes.com/Infotech/Software/UAE_firm_Etisalat_unveils_subsidiary_operations_in_India/articleshow/2834893.cms" UAE firm Etisalat unveils subsidiary operations in India
Telephone, TV and internet services provider Etisalat on Monday unveiled a new subsidiary operation in Bangalore, marking its maiden entry into India. Going by the brand name - Technologia, the subsidiary would develop software solutions for the telecommunication domain.
 HYPERLINK "http://economictimes.indiatimes.com/Infotech/Software/NIIT_acquires_German_company/articleshow/2823294.cms" NIIT acquires German company
NIIT Technologies Limited, the global IT solutions organization, today announced that it has acquired German-based SofTec GmbH, a specialist in providing IT solutions and services in the Airline revenue accounting and operations space.
 HYPERLINK "http://management.silicon.com/careers/0,39024671,39170203,00.htm" Oracle contractor shortage predicted
Oracle's success in growing its software business last year is now translating into a rise in jobs requiring Oracle skills being advertised and Oracle is already the second most in-demand skill for contract jobs in 2008, according to the recruitment company. The average annual salary for the last three months for a permanent Oracle job was £46,244, according to ITJobsWatch.co.uk. The average Oracle contractor daily rate for the past three months was £418.	

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