Bridging the outsourcing gap

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Bridging the gap

Over the past week Lloyds Banking Group has been under fire from the media as a result of a Daily Mail report that said Indian IT contractors were being brought into the UK to work in place of UK counterparts.

The article claimed that information from internal documents, seen by the Daily Mail, had revealed Lloyds managers are concerned about knowledge gaps of some computer specialists, hence they were possibly looking to their Indian partners to provide them with the necessary skilled workers.

The Daily Mail’s headline was that Indian IT staff are taking British jobs, perhaps in a bid to stir up more protectionist feelings towards using any form of offshored service, whether Lloyds actually decided to do so or not. However, there is a point to be made with regards to the UK’s ever expanding skills gap.

The offshoring of low level IT jobs has been scrutinised for some time now. Firms excessively offshoring work and not retaining (and training) in house specialists has resulted in fewer graduate opportunities and in turn means that mid level IT specialists are becoming a rarer breed.

As India and various other destinations have enjoyed a wealth of low level IT work, IT specialists in these countries will arguably have had better experience and training than their UK counterparts.

In turn, those IT workers that have climbed the career ladder in key offshore destinations would have had such a breadth of experience that they may be better placed to manage the IT teams of the future.

With this in mind it is understandable that large corporations are looking to incorporate offshore teams within onshore operations.

However, there needs to be a proper balance between onshore and offshore work and UK organisations need to start working with our home grown specialists a lot more.

Why not look at the opportunities for businesses to send their people offshore to get ‘on the job’ training?

Organisations sending technical entrants or graduates offshore for the first year would be safe in the knowledge that they have a quality skill set to bring back home. And these staff members would have built up good working relationships with the supplier’s team, too.

By not retaining enough good quality in-house IT expertise, businesses are at risk. They will no longer have the capability to design and run applications or IT systems themselves and will have no choice but to rely upon their offshore service providers.

This would leave them in a very vulnerable position; suppliers could essentially charge what they wanted for applications and systems and they would lose their competitive edge because they would have to rely upon the same ‘off the shelf’ package as their competitors.

Offshoring is of course an issue of great debate during times when a poor job market and turbulent economy is prevalent, but companies must think about the long term.

Protectionist policies should not automatically be adopted, we are after all in a global economy and the only way to overcome economic instability is by working together however, businesses should not get carried away.

If everyone offshored their IT in a bid to cut costs and take advantage of low level skill sets, they will quickly find themselves in deep water after the recession has blown over.

By nurturing and training a good quality in house IT team, businesses can be assured that they will remain competitive once the economy picks up and the UK can be safe in the knowledge that a quality stream of IT specialists are ready to lead the next generation of IT leveraged businesses.

Failure to do so could have serious consequences for the future of the UK IT market. The NOA is doing its bit by backing the first European accredited qualifications in outsourcing, maybe not technical but at least providing companies with the know how of how to structure these contracts so your retain team is in control.

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