Indian IT outsourcing firmHCL Technologiessays businesses are
increasingly seeking to get more value out of outsourcing deals by
opting to share share profits resulting from the
relationship.
"Punitive measures in
traditional outsourcing are aimed at ensuring service-level
agreements (SLAs) are met, but this new approach is designed to
encourage outsourcing companies to exceed
SLAs in return for outcome-based rewards over and above the
basic fee," said Rajeev Sawhney, HCL European president.
Although this is true of the market in general, Sawhney said the
rapid adoption rate of outsourcing meant a larger proportion of
companies in the UK are following the trend. The UK accounts for
29% of HCL's business, up from just 5% five years ago.
He said the UK had initially lagged behind the US when it came
to outsourcing, but ascribed the change to the UK's move from an
economy based on manufacturing to one based on services, which have
IT at their core.
"The role IT plays in service industries like banking and
insurance is significant because it is closer to the business and
relates directly to the bottom line with greater impact than in
manufacturing," he said.
According to Sawhney, the trend towards outcome based rewards is
a natural consequence of an increasing number of CIOs coming from
the business and having greater influence over how the business is
run.
"Customers are no longer interested in IT for its own sake, but
are asking instead how IT can help business achieve profitability
goals. The divide between business and IT is disappearing and
companies are no longer cautious about IT outsourcing and managed
services, but instead can see the
business value," he said.
HCL is confident the outsourcing market will continue to grow
and has recently announced a 42% increase in annual revenues.
Sawhney said a ready supply of technically qualified English
speaking IT staff from India means the accelerated growth of
outsourcing will be maintained for the next five to ten years.