globalization

The changing face of IT

Tue, 27 May 2008 07:00:00 -0400

The U.S. has powerful information technology companies--Apple, Google, Microsoft and IBM, to name a few. But globalization and new competition are having an impact on the American industry, with U.S. dominance on the decline.

That's the picture provided by Business Week's latest rankings of the top 100 IT companies in the world, which shows U.S. firms losing clout as others innovate, take advantage of cheaper operating costs and gain market share.

It's an unsettling development, and one that needs to be turned around given the importance of technology to the growth of the U.S. economy. When Business Week began its rankings in 1998, 75 of the top companies were from the U.S. Today, the number is down to 33, with the list now including 37 from Asia. - Judi

Check out the top 100 IT companies

Tue, 27 May 2008 06:59:59 -0400

Business Week posted its top 100 Information Technology companies worldwide--companies that are in hot industries, and that have performed well in terms of shareholder return, revenue growth and other economic factors.

Amazon.com and Apple led the list, but there were just 33 U.S. companies making the top IT 100, compared with 43 in 2007. The reasons for this decline and a broader drop in U.S. dominance in the past few years: globalization, outsourcing, and the growing importance of emerging markets India and China.

To read the list:
- see this businessweek.com article

India tech firms relocate to U.S.

Mon, 24 Mar 2008 07:59:59 -0400

India's IT service providers are trying out a new strategy in their growing technology businesses. They are hiring more U.S. talent and opening up branches in the United States. And this new trend may ease the debate among IT executives about whether or not to outsource in order to save costs. Indian firm Tata Consultancy Services said recently that it has opened a development center in Cincinnati, OH. The company plans to use the facility, a former paper plant, to show off its industrial engineering and services. They also plan to hire Midwest tech talent for the facility. Not long ago, Wipro Technologies from India acquired U.S. infrastructure management vendor InfoCrossing. It is recruiting about 500 people for a new Atlanta development center and plans to set up a center outside of Detroit. "Globalization of our delivery model is something we're doing at a very aggressive pace," says N.S. Bala, Wipro's senior VP of manufacturing solutions.

For more on India in the U.S.:
- See this InformationWeek article

When fiction is better than fact

Thu, 21 Feb 2008 06:59:57 -0500

The world of the 21st century is Internet based and no one sees that more clearly than Ralf Hirt, the author of the new novel, 8W8-Global Space Tribes. The Internet has changed the world, connecting people from the far ends of the Earth and igniting globalization. Hirt writes a compelling piece of fiction about how people can benefit from this and why they should navigate their world in better ways.

The book paints a picture of the new age where Internet activists from the industries of business, finance, media and government meet to develop the world's most advanced modeling engine. The novel offers readers a new way of viewing the world and a map of how today's technology may help solve some of the most pressing challenges. If you look back on some of the best science fiction of the 20th century, you will see that fantasy that indeed has come true. Just take 2001: A Space Odyssey, for example. And count how much of that fantasy is now reality. Hirt's publicists describe his novel as a "must read for anyone who has ever logged onto a computer or sat on a plane."

For more on this 21st century novel:
- See this website

African-American IT workers lose ground

Mon, 04 Feb 2008 06:59:59 -0500

There are good signs and bad ones for African-American IT workers. The number of African-Americans in the IT workforce rose by more than 10 percent in 2007. But their percentage in the overall IT workforce was lower than it was at the beginning of the decade, when the Internet boom was just starting. Just take a look at the numbers: African-American IT employment peaked in 2001 at 296,000. And last year, the number was 267,000, representing seven percent of employed business-technology workers, according to a CIO Insight analysis of data from the U.S. Bureau of Labor Statistics.

Employment among African-American IT professionals rose by 10.3 percent in 2007, reaching levels not seen since the Internet boom. Still, the percentage of African-Americans among all employed IT workers is lower than it was at the beginning of the decade. African Americans held 267,000 IT managerial and staff jobs in the United States last year, representing 7.1 percent of employed business-technology pros, according to the data. African-American IT employment peaked in 2001 at 296,000. That's nearly 9.8 percent, or 29,000 jobs, higher than last year's employment statistic. IT employment among African-Americans reached a decade low of 229,000 in 2002, the year following the 2001 recession and the dot-com bubble burst.

To compare these employment numbers with others, take a look at the number of IT workers with Asian ancestry. Asians represented 17 percent of employed IT workers. And their numbers were 638,000 in 2007. At the beginning of the 21st century, Asians were 12.4 percent of employed IT managers and workers. Meanwhile, the proportion of white IT pros has been decreasing since 2002 and was 74.3 percent of the workforce n 2007.

So what is the reason for this demographic change? Gina Billings, president of the National Black Data Processing Association blames globalization, which sent plenty of U.S. IT jobs overseas. As workers were laid off, she said, African-Americans, who proportionally joined the profession later than other professionals, were often the last hired and first fired as the workforce readjusted its needs for the 21st century.

Does this mean your job is in jeopardy? Probably not. But as we look at changes in the workforce, it's important to remember that plenty of outsourcing is coming home if it doesn't work, and that some companies are deciding that the risk isn't worth taking. However, this is still a time of plenty of changes, as the global market takes hold and continues to compete with the U.S. economy.

For more on workforce demographics:
- See this CIOInsight article

Offshore outsourcing may not be so cheap

Mon, 12 Nov 2007 06:59:59 -0500

CIOs are facing a fork in the road over offshore outsourcing because a domestic company owning a company in India may not be such a good deal. As CIOs look for ways to save money, owning an outsourcing operation in India seemed like a good plan. But now companies are facing the prospect that it may not be efficient.

It was reported last week that Citigroup Global Services, with offices in Mumbai and Chennai, India, decided to sell the operation to outsourcer Genpact for nearly $700 million. It's already looking like 2008 could be a lean year, and CIOs are looking for ways to cut costs. So this seems an odd choice in the wake of all the cost-savings that offshore outsourcing does provide. Apparently, American companies had unrealistic expectations, according to IT experts. Faced with the reality of rising costs from labor to real estate, companies have been unprepared to tackle the ownership problems they faced. But Cliff Justice, head of globalization for Houston-based outsourcing consultancy EquaTerra, says that most captive centers can be fixed by partnering with local providers and resetting expectations. And that means more hands-on management from the CIOs in the States. Let us know what your experience with offshore outsourcing has been? Is it cheaper, and do you trust it to deliver?

For more on the perils of outsourcing:
- see this CIO.com article

Overstating the flatness of international commerce

Mon, 08 Oct 2007 06:59:57 -0400

According to Pankaj Ghemawat, professor of global strategy at IESE Business School in Barcelona and professor of business administration at Harvard Business School, globalization is a major economic force to be reckoned with--but the idea that borders don't matter at all in commerce has been overstated in business literature. In his book, Redefining Global Strategy: Crossing Borders in a World Where Differences Still Matter (Harvard Business School Press, September 2007), he suggests that too many organizations depend on strategies that presume that complete global integration can be achieved. Thus, too much emphasis is placed on international standardization. While it is important to take advantage of similarities across borders, it is also critical to address differences. Technologies and standards may enable connectivity and collaboration at a distance, but it is an exaggeration to believe that we have achieved the "death of distance."

For more on globalization:
- read the article in CIOInsight

Smart offshoring can yield huge savings

Sun, 10 Jun 2007 20:01:39 -0400

Companies can potentially increase their back office offshore savings by over 50 percent by selectively integrating transformation and process improvement efforts into their globalization initiatives, according to research from The Hackett Group, an Answerthink company. The Fortune 500 could generate over $91 billion annually, or about $182 million on average per company, by strategically combining "Lift & Shift" efforts (which move back office processes overseas without first improving them) with "Transform & Shift" initiatives (where processes are optimized and then taken offshore). What's the key? Careful planning and analysis to determine which processes to offshore and whether or not to integrate transformation, and a staged approach to offshoring over a five to ten year period.

For more on using offshoring to your advantage:
- see this Tekrati article

Keeping your finger on the pulse

Tue, 01 May 2007 20:01:39 -0400

A successful CIO should know as much as possible about the market in which the company operates. That means knowing who your customers are by company, division and line of business, and how your customers are segmented within each division. You should know what touchpoints you have with your prospective, current and past customers; what your customers value about your products, services and interactions compared with your competitors, and what choices besides your offerings your customers have. You should know your key performance indicators (KPIs) and how they match with your customers' KPIs; how globalization and increased regulation will affect your markets and your market strategy, and what your potential disruptive market forces are and how quickly you can respond. You should know how the customer profile and business profile are expected to evolve over the next decade. And most importantly, you should know how your competitive landscape is expected to evolve and how you would deal with irrational competitive behavior.

Read more about knowing your market:
- read the blog at CIO

Bracing for change

Thu, 26 Apr 2007 20:01:39 -0400

CIOs should prepare themselves for a major transformation of IT's role in business, as business information, processes and relationships fuse with IT. That trend, highlighted by Gartner analysts at the Gartner Symposium/ITxpo 2007, means that IT decision-makers will have to focus on the role that they are playing within the organization. The CIO of tomorrow must be able to manage relationships with suppliers, users and key customers, who are increasingly demanding more access to systems. According to Gartner, there are eight major trends driving change, including transforming the management of IT, increasing commoditization and globalization. CIOs will also have to learn new management skills to cope with growing numbers of international agreements. Other trends include inspiring innovation and an increased use of social technology.

Read more about the changing role of the CIO:
- read the article at Management Consultancy