Successful IT Outsourcing Offshore
Outsourcing is an agreement in which one company hires another company to be responsible for a planned or existing activity
that is or could be done internally, and sometimes involves transferring employees and assets from one firm to another.
offshoring and outsourcing are not mutually inclusive: there can be one without the other.
They can be intertwined (Offshore outsourcing), and can be individually or jointly, partially or completely reversed,
The first example is IKEA.
As an example, first, we look at IKEA. In 2013, IKEA groups announced a joint offshore outsourcing project with Wincor Nixdorf
for setting the IT solutions to all the cash settlement units in all their branches.
During 2014-2015, Wincor Nixdorf set 12 thousand PoS-systems in 300 IKEA stores in 25 countries. A 6-year deal between them includes the installation and exploitation of PoS-systems.
The deal includes the point of use and further improvement Wincor Nixdorf software – TP.net, which is in charge of all the transactions in cash units and collects the data from all over the commercial network.
Having a single software provider offshore, IKEA not only lowered the work to run the stores, but it also has a significant cost reduction in implementation and exploitation.
They offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them.
This is the idea at the core of everything IKEA does, from product development and purchases to how they sell their products in retail stores.
The second outsourcing example represented here is General Electric.
The next section of the paper discusses GE’s decision to have multiple outsourcing partnerships. It discusses the strategies of successful multiple outsourcing and consolidated it with GE’s steps of outsourcing its businesses in different countries
GE used to be a pioneer in many business branches, including Successful IT Outsourcing Offshore. They were one of the first to transfer its operational department, data maintaining department,
and call center into the country of low expenses creating a special GECIS.
GECIS provided services of finance and bookkeeping, customer verification, e-learning and business analytics, and IT outsourcing and support of software development, securing thousands of business processes in 11 GE branches.
over 12 thousand people were working in GECIS, and you can imagine how much General Electric saved on people’s salary, only because they were working in India, not in the US.
Another example of successful offshore outsourcing is American Express.
IBM with its Canadian subsidiary company that made a 10-year contract with the National Bank of Canada for $700 million; accordingly, IBM Canada heads over the bank informational structure maintenance, including its websites and call centers. Besides, the partners will join for future development projects in the IT-sphere.
Following a 7-year outsourcing contract, IBM alongside American Express will manage the “americanexpress.com” website, administrate computer network AmEx, processing around 1 billion credit card operations daily, maintain the database, and keep the technical support to company employees. And American Express leaves new services, product development, and customer relationship to itself.
others follow these examples, outsourcing the development and implementation of new software, information processing, websites, and call centers. According to experts, this trend will only grow. Overall, the outsourcing evolution follows the tight cooperation between financial and informational technologies. They evolve from separate contracts to a wide, mutually beneficial partnership that enriches both sides.
Outsourcing can also affect every part of the business from manufacturing through to design,
software development, financial control, logistics management, customer support, and sales.