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India off-limits for outsourcing?

Posted by Steven Deare @ 10:47 3 comments

Australian Federal Police (AFP) boss Mick Keelty is the latest to voice concern about India becoming an outsourcing no-go zone, but how real is the risk?

Keelty this week told the American Chamber of Commerce there was a risk in outsourcing to India as it was one of the most technologically sophisticated nations on earth.

The net effect of this is that the country plays host to plenty of specialist identity theft groups, according to Keelty.

While I can't disagree with the existence of these groups, I do question whether, in practice, most outsourced technology operations in India have increased risk.

I'm reminded of my chat last year with Martin Telfer, Asia Pacific regional IT director with law firm Baker and McKenzie. Baker and McKenzie outsources to the Philippines, another country often linked with identity theft and cybercrime.

When I asked Telfer whether outsourcing to such locations posed increased risk, he said he felt a tier-one outsourcer, such as an CSC, EDS, IBM or Infosys would provide the same data security standards that all its datacentres must adhere to. In fact, he said he trusted their premises to be more secure than his own. That's hard to argue with.

In reality, most organisations that can afford to outsource to locations like India are hardly going to hand their data to "DelhiDodgyBlokes" or some other mid-size company. They're going to go best of breed.

That's not to say there isn't the risk of an insider job at these companies, just that it's unlikely because they have stringent data security standards in place around the globe.

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Talkback 3 comments

  1. Outsourcing risk Anonymous -- 04/03/07

    I do not believe that 'disappearing' in India is hard to do. You can make fake passports, IDs, certificates and then get a job in one of those call centres and then run away and assume a different identity once you have stolen personal data.
    It is a huge country and hiding in a different State is entirely possible.

  2. You have the naiviety of a child. Anonymous -- 11/01/08

    Outsourcing usually fails and that's when the company is local! Forgive me but the opinions of a middle-manager in some two bit law firm don't really count for much.
    After all the recent outsourcing debacles foisted on us (think EDS, IBM, CSC ) then these companies thinking of outsourcing should know better. Of course, as they are motivated purely by bottom-line economics they would sell you out in an instant if they thought they could get an Indian to do your job at $5/hr cheaper. Hell, they'd sell their own grandmothers to Banglaore if they thought it'd turn a quick buck.

    Mr Keelty is completely right and lets face it, he probbaly knows a lot MORE about the REAL situation than your law firm clown could ever dream to know.

  3. Think mature Anonymous -- 09/10/08

    Its easy to be judgemental about anyone or any place with a few facts in hand. I wouldn't be surprised if one of our own employees stole data from us. Eventually it is the human mind.

    Security, ROI etc are results of the maturity with which the deal has been struck. When an outsourcing deal happens, it is the responsibility of both parties to ensure their safety. As a customer, demand for security etc. needs. As a vendor, prove to your customer that you are worth the deal. All said and done, both parties need to have a process in place to do a periodic audit and forecast any risks etc.

    Though India does not have a background verification process as a government imposed policy, more and more customers are insisting on Indian companies to do the relevant background checks and provide proof. And the vendors understand and comply with the same.

    That is called maturity!

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Scott Mckenzie

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