Global issues

The issues facing IT professionals in 2008 are wrought on a global scale, according to the panel discussions at the Effective IT 2008 Summit.

On one hand, the distribution of IT staffing resources across the continents is challenging companies’ ability to manage employees as cohesive teams; on the other, pressure to reduce the negative impact of IT on the planet’s environment is reaching boiling point.

For some panel members, the wisdom of outsourcing – and offshore outsourcing in particular – is no longer self-evident. “We are continuing to drive our outsourcing and offshoring,” said Stuart Gilmour, head of UK wealth application delivery at Barclays Bank. “But so far the experience has been mixed.”

Sourcing IT staff from outside the company places high currency on the leadership skills of IT project managers, he says. “Hopefully, while people doing work for us may be in India and Manila, they should still be treated as part of my team,” added Gilmour. “To make outsourcing work is a people issue.”

And it is equally important to know what to outsource and what to keep at home, continues Gilmour. “We found that it is key to retain architecture and design in-house.

Having outsourced that at one point, we took it back into Barclays.” Dissatisfaction with the offshore outsourcing model was palpable among some attendees. “We have 2,300 developers, 40% of whom are in India, and in two years time it will be 60%,” Matt Ballantine, business relationship manager at news agency Reuters, told the panel. “We have achieved the cost savings but the people side has not been resolved.”

Nick Lansley, head of research and development for, explained how his parent organisation ensures that physical distance between its head offices and its Bangalore-based offshore development unit does not create a personal distance between co-workers.

“We use high-definition telepresence systems that are always on,” he said. “That way you pick up on the body language that you can miss when communicating over the phone.”

But for some organisations, the challenges of effectively managing outsourced IT contracts are driving them to new models of IT provisioning. “We outsource half of our IT,” said Martin Yates, head of IT services at investment bank Deutsche Bank.

“But 13 years down the line, it doesn’t feel good.” That, Yates explained, has led the company to consider the utility model of computing. “IT’s responsibility is huge, and we can’t do everything,” he said. “Why, for example, do we manage our email capability? We might consider using a service like Gmail at corporate level, although whether Google is ready for a customer like us is a different matter.”

But according to Andrew Morlet, head of the strategic IT effectiveness group at Accenture, the issues associated with outsourcing will not be so easily avoided. “Flat-world economics is a major trend,” he said, “and as globalisation continues, it becomes all the more inevitable that global organisations will have to do some outsourcing.

“It is incredibly hard to make work,” he added, “but we have to be able to do it.”

Negative energy

The other significant source of IT director headaches is the ongoing pressure to reduce energy footprint. Deutsche Bank’s Yates confessed that, to date, organisations in his industry have been loathe to conserve electricity.

“In financial services, we admit that our behaviour is pretty bad,” he said. “In order to stay in business you have to grow rapidly, and we’re doing it in an ugly way.”

That unchecked expansion has led to an insatiable appetite for energy. “Ten years ago, we were building 4-megawatt data centres,” Yates explained. “Now, 10 megawatts is the bare minimum.”’s Lansley sang the praises of virtualisation, it having helped to reduce the energy footprint of its data centres. “With virtualisation, we can run two data centres on 50% capacity. This allows us to make sure that one is always up, while keeping our electricity and data costs low.”

Again, Accenture’s Morlet put the issue in a global context. “The oil demand from China alone will soon be greater than worldwide production,” he said, adding that something must be done about corporate energy consumption in 2008.

Pete Swabey

Pete Swabey

Pete was Editor of Information Age and head of technology research for Vitesse Media plc from 2005 to 2013, before moving on to be Senior Editor and then Editorial Director at The Economist Intelligence...

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