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Will software robots ring the death knell for offshoring?

18 Jul 13

Offerings around robotics and automation will mature and lead to significant cost savings in service delivery but software robots will not spell the end of offshoring, despite industry claims it will.

That's the view from industry analysts Ovum, who outlines how these disruptive trends will become intrinsic to enabling cloud and removing the complexity and potential for human error, while at the same time allowing seamless scalability and automatic load balancing.

In the first ever comprehensive study around robotics and automation, the study dissects the impact of recent partnership announcements between global technology companies, such as Infosys, and automation vendors, such as IPsoft.

While industry stakeholders will be closely monitoring the outcomes of such deals, Ovum expects a rush of similar announcements, even if only a fraction of the suggested cost savings are realised.

“Fundamentally, the delivery of IT services and business processes are in a constant state of flux," says Tom Reuner, IT services analyst, Ovum.

"Competition, fast-changing regulatory and compliance guidelines, customer demands, technology advancement, integration dependencies and multiple stakeholders/geographies, amongst other things, are pushing businesses to achieve more in less time.

"Thus automation is always playing catch up with standardiation of ever-new technologies and concepts.”

While many are pointing to advancements in automation as an approach to achieve cost and time savings, Reuner believes they should be viewed as an additional instrument in sourcing strategies rather than a "panacea for process efficiency."

“The notion that software robots could conceivably ring the death knell for offshoring and at the same time lead to a process nirvana of highly automated efficiency has captured the imagination of stakeholders in the industry”, continues Reuner.

"However, service providers, according to Ovum, remain uncharacteristically quiet when it comes to these new disruptive concepts.

"They appear unsure of how these concepts could impact service delivery in areas not covered by due diligence.

"Equally, given that the aim of automation is to reduce human intervention, the inevitable political implications might explain service providers’ hesitance to explicitly discuss these approaches.

“As was the case for SOA and cloud services, there are no simple answers to how industrialised services will change the way IT services and business processes are delivered."

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