Rating

ITCO-Assignment 1
Case analysis-01
Group # Team1

15F11515F116- Bishwadeep
Purayastha
15F11715F118-

Section ITCO Sec-A

1
You have been hired as a Consultant by the senior management of CITYLIGHTS to determine the
best outsourcing location for the update project. You have finalized on two choices: Vegaland and
Bosnia. While making a recommendation for the outsourcing location, ignore the outliers. Assume
that each country is representative of all firms in that country. (Refer Exhibit A)

The major factors which govern location of IT cells or teams are as

follows:
Cost The biggest factor that contributes to the ever-rising software outsourcing is costcutting. Global companies save considerable amounts by outsourcing to India. Salaries of
software professionals in Bosnia are half of what is being paid in Vegaland. Though salaries do
fluctuate depending upon the living cost of index of different cities and set of skills, still it is far
lesser as compared to the Vegaland, which makes Bosnia a favourable location to shift IT team.

For 150 professionals if we assume all will be of same skill sets and same amount of
experience .Putting the team at Bosnia can save annually (150*30,000-150*16,000)= $210,000
Well-versed in English language Since English is an international language but still there
are nations which are not familiar with the usage of it. Therefore, it becomes difficult to trade
with such countries. Bosnia happens to be the ideal place as nearly half of the population is
well-versed with English and working force ie (22-34) age group has 70% proficiency makes it
easier for the to interact and outsource their business operations. Moreover, Bosnia has
abundance of educated and skilled workforce.

Technologically sound Another reason that drives movement of outsourcing business to

India is the professionals of the country are technologically sound and big time tech-savvy. The
experts here have in-depth knowledge of their fields and extend logical reasoning while
developing creative softwares or solving any run time shut downs or error.Here if you compare
Bosnia and Vega land , Vegaland seems to be more logical place to shift than Bosnia because
of being more productive and tech savvy

Work force availability- Workforce availability is a major concern for any IT team as attrition
rate and domain knowledge is scarce. It also shift balance to employee and hampers
economies of scale.If we compare Bosnia to Vegaland the availability of resource is higher in
Bosnia and which has potential of bringing employee cost and give company a guard against
attrition rate.

Infrastructure Last but certainly not the least, the availability of resources in terms of basic
infrastructure make a location favourable to any such out sourcing. And presence of similar
companies help in problem solving and knowledge sharing. Presence of more nos of software
companies proved that Bosnia has favourable infrastructure compared to Vegaland.

Apart from the above-mentioned reasons, timely project completion, quality consciousness
and suitable environment are other reasons which can make any other location favourable.
Summary of the result

Bosni
a
Cost
Well-versed in English
language
Technologically sound
Work force availability
Infrastructure
Final Choice

Bosni
a

Vegaba
nd

2
Assume that you are an IT consultant working in a company from Bosnia or
Vegaland who
have been chosen to perform the system update. How would you typically
approach this
project?