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Outsourcing is an issue but far from the primary problem. Banks, over the last 8 years, have systematically squeezed IT Project budgets to the point that delivery projects are not as rigorously tested as they once were. For example – one project I worked
on approximately seven years ago insisted that regression testing only be carried out on transactions they believed to be impacted by the implemented change. The consequence of this was the code was promoted to live and caused an issue. Why? Because the
third party supplier had “modified” code outside their remit – nobody had performed a full line by line review of the updated release and subsequently the changes were not picked up. Testing didn’t expose the changes as the transaction set in the testing
didn’t exercise those regions of the code. Net result: an emergency back out of the code and rollback to the original/previous release. Caused a massive investigation which should have influenced more reasonable IT Project budgets: it didn’t(!). A missed
I agree with the above comment...In a project I worked on recently, the Project Manager was stuck with an unrealistic delivery deadline and resource crunch. The Code Testing was completely compromised in order to meet the deadline with limited resources.
Instead of testing "all possible scenarios"...the testing scope was trimmed down to "most likely scenarios". I believe these individual compromises across multiple projects undertaken within banks have a big impact. It all boils down to delivery timelines,
resource allocation and ultimately IT budget (...on both legacy & new tech initiatives).
Deadline pressures lead to compromises on testing. Barring divine intervention, IT meltdowns are the result. This universal truth applies regardless of whether offshore vendors or onsite Big 5 consulting firms are involved in the project. So, let's not blame
offshoring for IT meltdowns in banks. Lloyds's own CEO does not - in his tweet, he totally exonerated offshoring for his bank's recent IT meltdown and placed the blame on the failure of an HP Server right "here in the UK".
Hypothetically, what about an onsite program manager giving short shift to testing in order to "secure" the deadline so that, again hypothetically, the bank executive's annual bonus is not impacted by slippage? How well does that help in these situations?
Does offshore or onsite matter then? Offshoring didn't start yesterday. The cold, hard truth is that offshoring has proven its superior price-performance for nearly two decades. Like with anything else, there are ways of getting offshoring right and there
are ways of bungling it. Now that the subject of Germany has come up, the apprenticeship model works well there because that's one nation that has forever succeeded in translating its higher input costs to manufacture high quality, value-added products for
which the rest of the world is willing to pay a premium, as evidenced by its top exporter nation status. There's no reason why the same model shouldn't work in any other country that matches Germany on that count.
What an unfortunately title to this article. The content doesn't match the title. Not all offshoring deals are outsourced and not all outsourcing deals are offshore. It should be "IT
Offshoring Blamed for Tech Failures at Banks." The title leaves the impression that all IT Outsourcing is to blame when many IT outsourcing deals are for onshore resource.
Perhaps I'm mis-reading, but it appears you're equating outsourcing with offshoring?
Of course outsourcing is different from offshoring in a general context. But, as I've highlighted in my previous comments, IT meltdowns can happen regardless of offshoring or outsourcing or insourcing, so the mixup in terminology is hardly material in this
11 Oct 2012