Selective sourcing hints at jobs lift

Terms like outsourcing and offshoring may have become synonymous with local job losses but as the new paradigm of selective sourcing emerges the potential for IT hiring looks brighter.

After 20 years of business, US IT services company Covansys established its first local presence in February this year with the opening of a Sydney office from which it intends to capitalize on the potential break-up of monolithic outsourcing contracts.

Covansys manager for Australia, and sole local employee, Rakesh Kapoor, said total outsourcing is not the right IT services model.

"We believe in selective sourcing and will tell our customers what not to outsource," Kapoor said, adding that Covansys often recommends certain things be kept in-house. "A lot of companies think they have to go all outsourced and are unsure about the options."

With three development centres in both the US and India, Covansys plans to open another in either Australia or China in the near term to support Asia-Pacific region customers.

Although, declining to speculate how many jobs Covansys' local presence is likely to create, Kapoor did say the local operations could have a couple of hundred people within three years depending on how quickly the market expands. Canberra and Melbourne offices are also earmarked for this year. Regardless of whether a full development centre opens here, Covansys will be recruiting people for software testing, Java development, and business consulting, to service the local market.

"Our model does not force any customer to offshore [and] we only recommend it if the business benefit is there," he said. "We will still have developers here."

So far, Covansys has Ford and a "large, multinational financial institution" as local customers, but Kapoor said initial discussions with prospective clients have been positive.

IDC's associate director of Asia Pacific services research, Phil Hassey welcomed Covansys' entrance into the local market, but said it will be a "massive challenge" to win business from the large incumbents.

"Covansys is not on its own [entering the market] and since the market is highly competitive, organizations won't take risks with vendors it doesn't know," Hassey said. "The medium enterprise market has the most opportunities, but they are limited because our IT market is small [so] finding them won't be easy."

Hassey said large organizations tend to be consolidating the number of vendors they have.

"Selective sourcing means three or four heads to kick instead of one," he said. "The net effect on the economy is a bit of an each-way bet. It will create jobs in project management but won't have a significant impact on the jobs market."

While Hassey does not think that Covansys has an impossible task, he said "to be honest", the odds are stacked against them.

"As ever, I would love to be proved wrong on this one," he said.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Rodney Gedda

Computerworld
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?