The Hindu : Business : Security standards in outsourcing vital

Online edition of India's National Newspaper
Friday, Apr 23, 2004

Business

Business

Security standards in outsourcing vital — Survey

By Our Staff Correspondent

CHENNAI, APRIL 22. Large Indian third party vendors will have to maintain quality and security assurance. The key is to maintain client confidentiality, ensure privacy for end-user and prevent misuse of client information, according to a report released at the Global Offshoring Outsourcing (GOOS) 2004 held in Mumbai today.

The survey, done jointly by the Indo American Chamber of Commerce (IACC) and the Ernst & Young, has stated that nearly 52 per cent of the respondents and 85 per cent of the large vendors have complied with the current global security standards. Some of the large vendors in the sample have multiple security certifications.

The report states that costs saving are not the only factor. The more important aspect is the partnering capability of the vendor. According to the survey, 83 per cent of the third party vendors invest significantly on an ongoing basis in obtaining quality certifications for their services while 42 per cent of the large vendors had multiple certifications. The survey states that 62 per cent of the respondents have participated in business case development and transition planning for offshore outsourcing.

Regarding human resources scalability, there is a high rate of attrition (averaging 40 per cent for voice and 25 per cent for non-voice services, on an annual basis) and absenteeism (ranging 2-8 per cent on a daily basis, primarily for voice) is by far the biggest operational challenges faced by most respondents.

The survey indicates that they typically maintain an average buffer of about 10-15 per cent, to counter these problems. Other retention strategies like incentives, job rotation, trainings and sponsorships are also captured in the survey.

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