IT offshore outsourcing here to stay

4 Jul 2008

Ireland has nothing to fear from outsourcing to lower cost countries and can still achieve its knowledge economy objectives.

A seminar held by Sogeti-owned Insight Test Services heard Ireland needs to embrace and not fear outsourcing to lower cost countries if it is to succeed as a knowledge economy in the new globally competitive environment.

Kavanagh’s comments come in the wake of news that Hibernian Insurance is to outsource 580 jobs to India.

“If Irish technology and indeed financial services companies are to move up the value chain, then it makes no sense to locate low-value jobs in a high-cost centre such as Ireland,” Kavanagh explained.

“In order to compete on global markets, we must be cost-competitive. Trying to hang onto jobs that can be more cost effectively carried out elsewhere is a false economy.”

Kavanagh said that in the IT services sector the opportunity is for Irish companies to help manage the outsourcing process on behalf of Irish customers. He said Sogeti planned to employ 200 high-level personnel in Ireland by the end of 2008.

“At the same time, Sogeti operates a 500-person testing centre in India. This ensures the appropriate quality assurance activities are carried out locally by Sogeti specialists interacting with the customer.

“While at the same time, customers can benefit from the cost advantages of having some activities suitable for offshore execution carried out in India under the direction of the Irish Sogeti team of specialists.”

Earlier this year, Insight Test Services was acquired by Sogeti, one of the world’s largest providers of local IT professional and test services. Insight Test Services, provides consulting, managed services, training and resourcing services to over 80 clients.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years