Risks and rewards from offshore outsourcing

While outsourcing IT services to an offshore firm may have seemed a radical concept a decade ago, it’s now becoming a fairly common practice among many large- and medium-sized Canadian IT shops.

The Relevance of Global IT Sourcing in the Canadian Market” was the topic of a panel discussion held recently in Toronto. The event was hosted by TiE Toronto and sponsored by Satyam Computer Services, India’s fourth largest IT services company.

Is offshore outsourcing a threat to Canadian IT workers? Not necessarily so, according to panelist Chuck Hounsell, SVP and CIO, Technology Solutions, for TD Canada Trust.

“Canada is in a fantastic position to exploit this opportunity,” he said. “The question is, what are we going to do with our own IT professionals? Some companies are going to outsource their entire IT shop. They’re going to have to figure out what to do with their IT professionals to give them a growing, significant role – to bring them on the journey.”

Added Terry Stuart, a partner with Deloitte Consulting, “People are worried that they might lose their job and that this will affect their career path. But the people delivering IT projects who go first through that [outsourcing] door will be the ones most in demand in the marketplace.”

Peter Sweers, SVP of Domestic and Wealth Management Systems Development at the Bank of Nova Scotia, said not all dealings with Indian outsourcing firms will necessarily result in layoffs. He described the work his bank is doing with outsourcers as “staff augmentation”, and said they take on tasks his in-house IT staff simply don’t have time for.

“There’s way more demand on the business side than we have the capability to deliver,” Sweers said, adding that the work done with Indian firms isn’t “any different than doing work with a [partner] here”.

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