No issue with outsourcing: Standard Chartered

MUMBAI: A flat (0.0 per cent) and 3.3 per cent in best-case scenario, between flat (0.0 per cent) and a decline of 2.5 per cent in worst-case scenario and between flat (0.0 per cent) and an increase of 3.0 per cent in the most-likely scenario. This is how Global IT budgets are predicted ahead by research experts like Gartner.

In an interesting projection released some time back from Gartner EXP CIO survey, the full results of which will be available in the first quarter of 2009, Gartner has said economic uncertainty dictates that prudent IT organizations prepare three alternative budgets: best-case, worst-case and most-likely scenarios.

Of the 444 CIOs surveyed around the world, 48 per cent were projecting an IT budget increase in 2009 while 52 per cent of CIOs reported flat or IT budget decreases in 2009. On a weighted basis and considering all 444 IT organizations, 2009 IT budgets are set to increase 3.36 per cent.

The figure-watch is surely coming up with a new flavour for CIOs.

Slowdown, reduced IT spends and a fog around outsourcing made deeper by recent political and protectionist weather. All this seems to be the zeitgeist for any CIO today.

It's no surprise that in the annual Gartner Executive Programs (EXP) CIO survey, Gartner said IT leaders are wary of making dramatic budget cuts because they know it will be difficult to 'ramp up' their IT capabilities when opportunities for business growth return.

But at the same time, it added that business growth is not declining at the same rate across geographies, and CIOs can exploit asymmetries between regions and industries to find new opportunities.

The spotlight naturally turns sharper for a CIO from geographies like UK or US and specially one that represents the much battered global banking industry. But keeping the focus intact and steering smart with a pragmatic approach is what separates the wheat from the chaff.

David Awcock, group head of Technology, Standard Chartered Bank speaks to Pratima Harigunani of CyberMedia News on some hot issues enveloping a CIO in the current times.

He has held a number of senior roles in SCB across application development, technology for the Bank's wholesale division and his metier covers over 25 years of management experience in the IT industry for a wide range of companies engaged in financial services, manufacturing and FMCG businesses.

Also, he brings along a wide experience in working with IT vendors across the whole spectrum of IT services, and has had extensive involvement and engagement with Indian software companies for more than 10 years.

Here are some excerpts of the interview on the sidelines of NILF 2009.

CMN: It couldn't get tougher than what we are seeing now. How are you, as a CIO, coping with it in terms of your direction ahead both at a strategic as well as tactical level across issues like Buy Vs Build, outsourcing, trimmed Budgets, technology portfolio, contract renewals etc?

David Awcock: We have always had a conservative approach and never allowed to over-invest ourselves into anything. Today, we are definitely evaluating on every technology spend and not just the 'how much' part of it but the 'what', 'why' and benefit part crucially. We would try to run an efficient model.

CMN: What are your expectations as a customer? What are the missing pieces today?

DA: We want IT vendors to give us propositions that are cost competitive as well as unique and attractive. Combining cost arbitrage with a tempting value proposition and putting everything in a right package at the right price would really help.

CMN: How much impact has slowdown brought on immediate spends?

DA: We are continuously reviewing our plans in the face of changing economic conditions.

CMN: And how would the current global and political scenario play out for outsourcing as an IT strategy per se?

DA: It will continue. To me, it is not big difference if we get the required value and skills from anywhere in the global economy. We take advantage of the best access to talent, anywhere. If that constitutes outsourcing, we will do that. And India is definitely a beneficiary point here.