Friday, December 17, 2010

Gartner Reveals Technology Predictions for 2011

End of the year is as ever favorite time of most analyst firms for rolling out predictions, forecasts and all sorts of watch lists for the coming year. Especially of interest are those from most influential analyst powerhouses, like Gartner for example. Last week Gartner – the world's leading information technology research and advisory company –issued its “Top Technology Predictions” for IT organizations and users for 2011 and beyond. Let’s have a closer look at some of them which we find are worth sharing:

Twenty Percent of Non-IT Global 500 Companies to Deliver through the Cloud. More and more – 20 percent – of non-IT companies in the Global 500 will continue to deliver products and services through the cloud, becoming de facto cloud computing companies by 2015. That means the role of IT decision making gets broader, and non-IT companies find themselves competing directly with IT service providers.

IT Automation Results in Tangible Costs Savings through Man-hour Reductions. Self-service and automated provisioning associated with cloud delivery means productivity levels for service providers will increase—Gartner estimates a 25 percent reduction in IT labor hours by 2015.

Consumerization of IT Transitions to “Postconsumerization”. Gartner predicts “postconsumerization” as one of the major trends for the upcoming years where instead of IT focusing on devices, apps and infrastructure, IT will shift to address info and peer-to-peer interaction. It is expected that ninety percent of companies will support corporate apps on personal devices like mobile, laptops and tablets, by 2014.

Tablets Get Enterprise Support. iPad is just the first in a long future line of media tablets focused on “communications and consumption” of data instead of “creation” . As a result, 80 percent of enterprises will offer support for network connectivity, email, calendaring, and help desks by 2013 on tablets, says Gartner.

National Infrastructure Hacked and Disrupted. By 2015, Gartner predicts at least one of the G20 nations will be the victim of dramatic online sabotage that will disrupt and damage critical infrastructure components. Whether it’s a stock exchange, physical nuclear plants or mobile-phone message routers, the analyst firm says attacks with lasting damage are only a matter of time.

Source: Channel Insider

Wednesday, December 1, 2010

Western Europe’s Outsourcing Trends

Western Europe, the second largest outsourcing market after the US, is characterized by a pretty diverse behavior in terms of software development outsourcing habits. The latest trends and key similarities and differences in ITO engagement were recently highlighted in a report by an independent IT outsourcing (ITO) research and advisory company IT Sourcing Europe. The report is based on a comparison analysis of corporate outsourcing behaviors in the United Kingdom, Denmark, Germany, Switzerland, Netherlands, and Austria.

Below are some thought-provoking findings for nearshore and offshore software vendors:

1. Regarding the most popular outsourcing destinations in 2010, the majority of the UK and Dutch companies (23% and 29% respectively) outsource their software/web development offshore (i.e. India, China, Philippines, Pakistan, etc.), while most of Danish (34%), German (37%), Swiss (41%), and Austrian (32%) companies prefer nearshoring when it comes to outsourcing software development (Eastern Europe and the Baltic states are among the most popular destinations).

2. Regarding the future outsourcing destinations, the equal number of the UK outsourcers (28% and 28% respectively) will place their software development function nearshore and offshore; the majority of Dutch companies will be sourcing nearshore (27%), while Danish, German, Swiss, and Austrian companies will continue outsourcing nearshore (25%, 31%, 32%, and 30% respectively).

3. Regarding the actual savings from the outsourced development, most of the UK (36%) and Danish (27%) companies save 40% to 59% of their operating costs, while majority of Swiss (35%), German (38%), Dutch (28%), and Austrian (31%) companies manage to save 10% to 24% from their outsourced development.

More interesting findings will be available in the European ITO Intelligence Report 2010 to be released in December 2010.

Source: IT Sourcing Europe

Friday, November 19, 2010

Outsourcing Market is Ramping Up Challenging Established Locations

A newly released study by Duke University's Offshoring Research Network and PricewaterhouseCoopers has revealed that the long established outsourcing locations India and North America are steadily surrendering in the space of outsourced software development. Eastern Europe, Latin America, and Asia, on the contrary, are picking up steam and emerge as strong global rivals. The challenging service areas are named contact centers, business process outsourcing, and information technology outsourcing. The results are based on a global survey conducted among 514 outsourcing service providers in 50 countries.

The survey’s findings clearly indicate the growing potential of the outsourcing market with offshoring continues constituting its biggest part – the market continues to expand globally driving competition and more cost-effective services. "Growing competition has transformed the outsourcing industry into a global race for market share," PricewaterhouseCoopers’ Managing Director Charles Aird noted in his statement.

Other facts of interest according to the survey include:

• A large number of service providers expect to begin new software development and IT-service contracts over the next several years. Overall, 62 percent of service providers said they plan to expand the scale of their existing offerings.

• The survey also found that the economic crisis of 2009 reemphasized the importance of cost savings and efficiency improvement as the top strategic reasons for outsourcing, followed by access to qualified personnel.

Source: Outsourcing-Russia.com

Friday, November 12, 2010

ITO Market Keeps Up Growth in the Third Quarter: Everest

Everest Group, a global consulting and research firm, has recently issued its Q3 Report on the global outsourcing market. The findings reflect certain improvement of the IT services (ITO) market compared to the previous quarter, while business process outsourcing (BPO) activity marginally decreased. The report mentions, that ITO activity was largely led by five "mega deals", each having contract values over $1 billion.

Other key highlights of the report include:

• North America continued to account for about one-third of total transactions; North America and the United Kingdom contributed toward about one-half of all deals. Notable activity was reported from select geographies, including Spain, Germany and India.

• The banking, financial services and insurance (BFSI) and manufacturing, distribution, retail (MDR) verticals continued to dominate transaction signings, with some high-value contracts also reported in the public sector.

• In addition to the five ITO mega deals, 60 large deals with contract values exceeding $50 million also were recorded during the quarter.

• Offshore activity saw 34 delivery centers established in the second quarter, the majority in Asia followed by Eastern Europe and Latin America.

Source: Global Services

Monday, October 18, 2010

Introducing Multimodal Agenda for Software Testing

In the latest issues of Software Magazine, authors Kim Pries and Jon Quigley have presented a worthwhile approach to fit most software testing needs. The so-called four-phase approach concentrates on the following most used testing models: compliance, combinatorial, stochastic or exploratory, and extreme value testing. Below are the highlights of the article with most essential standpoints.

• To have compliance testing there should be requirements (product specifications) for which compliance is essential. That seems easy. But the challenging point is to define the product environment. This might not be as easy and in many cases also time-consuming and expensive. But on the other side of the story, underestimation of environmental factors, especially in embedded software development, may lead to big failures. If the product meets the customer specification but fails in the field, the customer organization will bear the burden of resulting penalty and suffer negative effects.

• Combinatorial testing. There is usually a combination of factors, environmental or external, present in the field which makes thorough adequate testing difficult. In some cases the most critical variable is time. How much time is necessary for thorough testing? For this, we need to evaluate substantial experimental or field information. Combinatorial testing consists in finding interactions of stimuli that can have impact on the product. The goal is to define these multiple stimuli that the product will most likely experience.

• Stochastic or exploratory testing occurs when an experienced test engineer uses his or her intuition to conduct unplanned experiments with the product. The value in this testing approach lies in the fact, that it adds a touch of reality by simulating the behavior of real users.

• Severe Environment testing. Extreme scenarios are those test cases that push the product to its limits. Relying on the commonly heard “this will never happen in the field” may lead to serious concerns, because events of the kind actually do usually occur in the field.

As a matter of fact, this is how a four-fold mechanism for providing substantial test coverage works for software development. A fifth optional method suggested by the authors is to attack own software as if you were evil “hackers” determined to break own code. The main point of the approach is to “attack” the product software in any possible way to see if and where it can be vulnerable. The only strong path to strong software is believed to be in looking not only for requirements failures but also for definable weaknesses.

Source: Softwaremag.com

Thursday, September 23, 2010

The Nearshoring Choice of European Businesses

During one of the latest Global Services’ webinars, Avinash Vashistha, CEO and Chairman Tholons, noted: "Western Europe has done a significant amount of nearshoring to Eastern European countries which have become a part of European Union.”

But what makes EE/CEE locations so attractive for Western clients? Why, unlike their American counterparts, European businesses prefer to keep their IT initiatives close to home? Why such popular offshore destinations like India and China are losing ground?

According to Tholons and Global Services' joint study, the first reason for Europe’s neashoring success lies in the conservative nature of Europeans who are comfortable to keep work close to home and do not have a settled tradition of sending work overseas. And traditions mean much in Europe.

The second reason is the wide choice of Eastern European countries which are traditionally strong in IT with a reputable and solid background in computer science. For example, the study distinguished the following EE countries strong in software outsourcing: Poland provides excellent BPO and IT services, Hungary offers cost effectiveness for clients, Russia is good at technology development and R&D work, Ukraine offers capabilities in BPO, and Romania in business analytics.

And last but not least, the study mentions financial attractiveness, cultural compatibility, and good educational structure of EE countries.

Attractive combination altogether, isn’t it? No doubt, EE/CEE shall see increased investments in the near future and increased customer interest in their IT offering.

Source: Global Services

Thursday, September 9, 2010

Europe Embarks On the Outsourcing Spree

According tо the recent report by Gartner, world’s leading information technology research and advisory company, IT outsourcing is strongly gaining momentum in Western Europe, the second largest market after the US. The survey results show, that more than half, exactly 53%, of organizations in Europe plan to increase outsourcing initiatives in 2010, and 40% anticipate to surge spending on external IT services. The online survey was conducted among 206 organizations in Europe during in the first quarter of 2010.

At the same time, the analyst firm does not see it all in bright colors and warns service providers of potential constraints. With IT budgets still tight, European organizations expect their vendors to deliver tangible cost reductions. The market opportunities are large, but the customer expectations are also high. European organizations are looking for outsourcers to provide more than “my mess for less”, says the report.

Outsourcing upside creates excellent opportunities for nearshore service providers. Nearshoring has a row of advantages, such as time and cultural proximity, cutting travel costs, etc. In such situation, established Central and Eastern European vendors, which bring about the whole bunch of nearshoring advantages, come as a natural choice for many Western European clients.

Source: V3.co.uk