Financial services industry's turn to outsource

BANGALORE: The financial services industry is taking the same offshoring and outsourcing route pioneered by the manufacturing industry, according to a study by the Indian School of Business (ISB).

The study jointly undertaken by a team from London Business School and the Capco Institute, explores the experiences and sourcing strategies revealed by sixty-two executive respondents from the world's top financial services organizations.

The findings dispel many of the myths surrounding outsourcing and offshoring in the financial services industry.

According to the survey's authors, the results for companies and employees in India could be continuing rapid growth in opportunities and not just in call centers and transaction processing. Indeed, they have identified a growing willingness to outsource and offshore more complex and multi-process activities.

Dr. Phanish Puranam, assistant professor at London Business School and co-author of the survey, speaking at the seminar said: “The survey highlights that financial services companies are finally adopting what can truly be described as a Global Services Sourcing Model. They are doing what the manufacturing sector did years ago, breaking up the supply chain and breaking free of geographical and organizational boundaries.”

Dr. Suresh Gupta, head of Sourcing, Capco, added: “Despite the myths and media headlines surrounding offshoring, the leading financial services organizations are already far along the path of implementing sophisticated Global Sourcing Models. It is no longer a question of whether to outsource or offshore a generic process like IT maintenance; instead they are already moving complex, business-specific processes offshore.”

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