Patni Computer Systems survey finds Multi-Vendor Outsourcing on the Rise

Patni Computer Systems (today announced the results of a recent CIO survey conducted at its annual customer conference, 'PatniConnect'.  According to the survey, 45% of the respondents prefer leveraging multiple vendors for specific project requirements with work competitively distributed, as opposed to 17% favouring global deals with a single service provider.  Patni conducted the survey with more than 100 Global CIOs and business leaders from the company's customer base across the US, Europe and Asia.

The survey also revealed the Global CIO's vision on IT Strategy & Outsourcing, Investments & Initiatives, and Customer-Vendor Relationship.

Key findings include:

* IT Strategy & Outsourcing:

- With multi-sourcing gaining traction within the industry, vendor selection is moving away from a country-specific to a more global, talent-based destination mix.  The survey saw 32% still depending largely on India for offshore requirements, but a close 29% selected sourcing requirements from multiple locations.  Twenty-three (23%) of the respondents mix a large local sourcing component with an offshoring component.

- Although cost savings is still an important factor in selecting an outsourcing partner, 33% of the respondents indicated that quality of services was the primary concern. Cultural fit, the top choice in last year's survey, slipped to third place at 15%, while lowest cost was tied with flexibility for fourth in importance at 10%.

- While the number of those employing IT-based captives was up slightly from last year, an overwhelming 67% of the respondents indicated that they do not have captive offshore facilities and have no plans to set them up.  Customers see captive facilities as a substantial obligation and as long as they are getting measurable results from their service providers, they do not see any reason to run their own centres offshore.

* Investments & Initiatives:

Technologies such as Web Services, SOA and Business Service Management (BSM) were rated high investment areas over the next two years. Increasing emphasis on Web services and SOA indicates that CIOs want technologies that allow more flexibility.  Ninety-four percent (94%) of the respondents cited an increase in their outsourcing budgets overall, with nearly two-thirds (65%)indicating increases ranging from 5-35%.

* Customer-Vendor Relationship

The risk/reward framework (fixed price contracts with pre-defined SLA commitments) is the most preferred mode of commercial engagement allowing for a more globally competitive environment (29%), followed closely by fixed price contracts (26%) where customers are cushioned against industry inflation in specific economies.

 Top Stories

UK Welsh Water signs £100m outsourcing contract
The deal, with CapGemini, LogicaCMG and TCS, is one of the largest signed by a UK utility.  It involves major hardware replacements and a move from legacy software to a fully integrated SAP enterprise resource planning system.

Insurance company Tokio Marine Brasil signs IT infrastructure outsourcing contract
Brazil's Tokio Marinehas signed a 10-year, $44-million IT infrastructure outsourcing contract with IBM.  The agreement includes integration of services, unification of datacentres and technological updates for most of the hardware environment to support Tokio Marine's strategic objectives

BB&T signs multi-year card processing agreement with Fidelity
BB&T Bankcard Corporation is a wholly owned subsidiary of BB&T Corporation.  Under the terms of the five-year agreement, Fidelity National Information Services will process all transactions for consumer and commercial credit cards issued by BB&T Bankcard Corporation.

US SEC awards $48mn contract to Keane Federal Systems
The United States Securities and Exchange Commission (SEC) has contracted Keane Federal Systems to manage, maintain, upgrade and eventually replace its aging Electronic Data Gathering, Analysis and Retrieval (EDGAR) system.

Air NZ to outsource jobs to Fiji
Air New Zealand has confirmed about seventy Finance Department clerical workers' jobs now called Financial Shared Services, will go offshore to Fiji from January 2007.

Delphi Cuts Outsourcing Deal With EDS, HP
The automobile parts company, which has spent the last year in Chapter 11 reorganization, said in papers filed with the U.S. Bankruptcy Court in Manhattan that it reached deals with Electronic Data Systems and Hewlett-Packard involving an 'accelerated consolidation and outsourcing' of its IT functions.  The move will shrink the company's global roster of IT suppliers by 90 percent.

Visteon opens $10 million technical centre in India
Global auto parts supplier Visteon has announced the launch of a new technical centre in Chennai, India.  The new centre will build on the current capabilities of the India software team to develop and validate electronic modules for audio products, instrument clusters, body control modules, adaptive lighting products, electronic climate controls, powertrain electronics and engine control modules, centre displays and other products.

 Service Provider News

CSC takes over $3.73B IT contract with the United Kingdom's National Health Service.
CSC has won a nine-year, USD 3.73 billion IT services contract with the UK National Health Services (NHS).  This contract is a part of NHS' Connecting for Health program, which aims at improving the healthcare services for patients in the North East and East of England.  Previously, the contract was with Accenture.

IT suppliers short listed for 2012 Olympics
Accenture, BT Global Services, IBM and LogicaCMG have all been short listed for a contract to provide IT systems for the London Organising Committee (Locog) for ...

LogicaCMG Has Been Awarded a 14 Million Euro Contract by the European Commission
LogicaCMG today announces that it has been awarded a 14M Euro contract over five years by the European Commission (EC) to support the Taxation and Customs Union Directorate General in the quality assurance and quality control of all IT projects.

ACS Renews and Expands BPO Contract With First Horizon Home Loan Corporation
ACS has won a renewal along with scope expansion for its BPO services contract with First Horizon Home Loan Corporation.  ACS will continue to provide various services, including document preparation, scanning, and indexing of mortgage loan files to First Horizon.

AT&T gets 5-year Sterling Bank networking contract
AT&T will provide a IP VPN service that will integrate Sterling Bank's 40 branches in the Houston, Dallas, and San Antonio metropolitan areas, as well as its corporate office in Houston and its data centre in central Texas.