Outsourcing for Business Growth
By Bijay Shankar Patel
New Delhi, Nov 19, 2007

Infrastructure Management Outsourcing (IMO) has gained impetus in today's business scenario as CXOs want to keep their workforce agile and focus on their core business competencies and business strategy. By exercising this option, the total Cost of Ownership (TCO) is optimized while managing the complexities of today's diverse IT environment. It also helps in providing flexibility to transition and transform to the next generation of infrastructure and applications without investing in retraining or expensive skill upgrade.

"Although initially it was mostly the non-IT companies which opted for IMO as they lacked the competencies in managing a growing IT infrastructure, today even large IT companies opt for this business model as they believe in concentrating on their core objective of delivering value to their clients, rather than spending additional effort in maintaining a growingly complex IT infrastructure," said Kaushik Chandra, CTO, PricewaterhouseCooper.

KNK Venkataraman, vice president (global delivery) for technology infrastructure services at Wipro Technologies says that independent research firms estimate the worldwide IT infrastructure and applications outsourcing business to be now worth about USD 120 Billion per year, and Wipro's revenue for FY 06-07 stands at USD 657 Million.

Wipro, HCL Comnet, and Tata Consulting Services are some of the major infrastructure services management providers in India. The Indian companies are expanding their business and delivery beyond India. There's a focus to increase their near shore and onsite presence through organic or inorganic growth. Indian firms are also tying up with local partners to provide on the ground field support.

Right from data centre management to the entire IT infrastructure management comes under the ambit of IMO. Desktop management, server management, help desk or level 0 database management, as well as network management are some of the services provided under it.

But selecting an infrastructure service provider can pose challenges for a client. A right balance needs to be struck between the service provider and the client in terms of aligning the business objectives as well as in change and process management. Solutions provided by the service provider should be tool agnostic, so as to protect prior investments as well as future investments in terms of mergers and acquisitions. With more and more clients opting for multiple service providers in order to mitigate risk, governance is becoming a challenge for the service providers. Indian service providers have to differentiate themselves by their ability to execute, as multinationals are buying into India and are becoming direct competitors.

Commenting on the scope for the Indian IT companies, Venkataraman stated, "Indian IT companies still have lots of room to grow. In a recent survey by industry analysts, only 34% are using offshore resources wherever and whenever possible. There's lots of headroom for infrastructure outsourcing in NA and EMEA".

Related links:
Transforming Remote Infrastructure Management
Remote Management Services for Enterprises