Strategic CIO // IT Strategy
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12/20/2005
12:19 PM
Paul McDougall
Paul McDougall
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Seven Fearless Predictions For Outsourcing In 2006

There will be a major data-security breach at an offshore firm. The resulting controversy will have no impact whatsoever on the outsourcing industry as businesses realize the same thing happens in the U.S. almost every week. And here's six more of my can't-miss prognostications for the year ahead in outsourcing.

There will be a major data-security breach at an offshore firm. The resulting controversy will have no impact whatsoever on the outsourcing industry as businesses realize the same thing happens in the U.S. almost every week. And here's six more of my can't-miss prognostications for the year ahead in outsourcing.An Indian IT-services firm will buy a significant U.S. software vendor. Many Indian tech companies are cash rich from recent IPOs and are looking for ways to diversify beyond outsourcing. Look for at least one deal where a major Indian player acquires an ISV with dominant market share in a vertical such as manufacturing or financial services.

Lou Dobbs will continue his hypocritical, ill-informed tirade against outsourcing, even though he willingly accepts a paycheck from a company, Time Warner, that his own Web site says is "Exporting America." Questions for Lou: Do you think TW could afford your multimillion dollar salary if it wasn't sending back-office work to India? Have you offered to take a pay cut if it means keeping more Time Warner jobs in the U.S?

A Fortune 500 company will announce that it's repatriating an operation that had previously been offshored, stating that the potential savings were "overhyped." Pundits say the move marks the end of the outsourcing trend. It doesn't, it just marks the professional demise of a CIO who failed to properly manage his offshore operation.

I will continue to get flamed by critics of offshore outsourcing, even though the U.S. economy is purring along at near-full employment.

Most tech workers in America are benefiting from the global economy, and as a result efforts to unionize IT pros at major companies like IBM and HP will continue to go absolutely nowhere in 2006.

Despite the increasing popularity and proven economic value of offshore outsourcing, companies will still not use the word "offshore" in 2006 to describe their operations in low-cost countries. To save them a few bucks on marketing fees, here are some free, alternate suggestions: Global Shore…Virtual Shore…Not-So-Near Shore…Best Shore (oops, sorry EDS)…, and, um, Kong Shore.

Happy Holidays

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