Global versus local
Australian CIOs are interested in what is happening overseas, but unless they operate within an organisation that plays on the global stage — such as banking or resources — the options available from vendors for services, skills and innovation are fewer than in Europe or the US.
“Asia is our backyard, but you hear of so many offshore deals hitting the wall,” says founding director of Cherub Consulting Group, John Liburti. “While CIOs in Australia are not gun shy, they are very selective about which trend they follow. They pick the eyes out of the better ideas; the ones that have a proven bottom-line benefit to the business.
“Take Cloud computing. Most researchers tell you it’s the next big thing. While I agree it has promise, those same organisations place caveats on their predictions by saying there is still a lot of work needed to prove the concept.
Some CIOs are testing the water, but they are doing a lot of homework, surrounding themselves with colleagues and advisors, and creating excellent change management processes.”
Joanne Stubbs, the CIO at Bakers Delight, does not believe there is such a thing as a global outsourcing trend.
“I’ve been in IS for more than 25 years and it just depends on where you are in the world at any given time, global financial crises, stock market plunges, Aussie dollar rates, or how mature your business is as to whether you outsource or not,” she says. “Like anything in IT, it goes in circles every seven years.”
One of the first moves Stubbs made at Bakers Delight, after stints as CIO at The Good Guys and General Motors Acceptance Corporation, was to outsource all the bakery franchise’s printing to Australian-based provider, Upstream. But while many of her CIO colleagues around the world seem happy to use low-cost centres outside their shores, Stubbs would never outsource overseas.
“I inherited an outsourcing contract at Bakers Delight, for a call desk, that did not stipulate that the provider needed to seek our agreement if they wanted to outsource their call centre elsewhere,” Stubbs says.
“It meant that if we had an issue and we rang their call centre in Australia we could be put through to India or Malaysia. I won’t even enter into discussions with outsourcers that have their call centres offshore. I don’t want my customers having to deal with that experience.”
Read more in the CIO Australia outsourcing series
The AT Kearney Global Services Location Index. The GSLI analyses and ranks the top 50 countries worldwide to determine the best destinations for providing outsourcing activities, including IT services and support, contact centres, and back-office functions. Each country’s rank is composed of a weighted combination of relative scores on 43 measurements, which are grouped into three categories: Financial attractiveness, people skills and availability, and business environment.
Blue - No significant moment
Green - Significant movement up the index
Red - Significant movement down the index
* - based on lower-cost locations in each country