Success breeds problems for Bangalore

Computerworld - Success Breeds Problems for Bangalore

As a location for IT outsourcing, Bangalore, India, is still the place to be. "It's far from past its prime," says Eugene Kublanov, a vice president at neoIT Inc., an offshore outsourcing consultancy in San Ramon, Calif. Bangalore still has the best concentration of IT talent in India, beautiful high-tech business parks and good weather, he says.

But the boom in offshore outsourcing is also putting strains on the infrastructure in Bangalore, which faces stiff competition from other cities in India for outsourcing business. The No. 1 complaint about Bangalore is that drivers face hours-long traffic jams on chaotic, inadequate roads. That's followed by complaints about the airport, which badly needs to be upgraded or replaced.

"The infrastructure [in Bangalore] requires a significant amount of investment, or the city won't be able to sustain its growth," Kublanov says.

A neoIT study of the best cities in India for outsourcing ranks Bangalore second, trailing the city of Gurgaon. Pune, Hyderabad and Chennai are nipping at Bangalore's heels, according to the study.

Perhaps the biggest challenge for outsourcing firms in Bangalore is the hyperinflation of IT salaries, which were up 15% in 2004, Kublanov says.

For outsourcing firms, "it's becoming very expensive to do business in Bangalore, by India's standards," he says. "Their fees aren't going up 15%, so their margins have to give," which is why Bangalore giants such as Wipro Ltd. and Infosys Technologies Ltd. are starting to set up additional operations elsewhere.

Best Bits

The most useful parts of recent business and IT management books.

The book: Privacy: What Developers and IT Professionals Should Know, by J.C. Cannon (Addison-Wesley, 2005).

Finally, there's a privacy book for IT managers instead of policy wonks. This isn't the perfect privacy book, but it has useful sections on improving privacy at Web sites and providing multilevel access controls for databases so that only certain employees can see the most sensitive information on a need-to-know basis.

A key message is that privacy needs to be baked into IT applications from the outset—yes, just like security—and the book provides a detailed methodology for exactly how to do that. The trick will be overcoming resistance from application development teams who fear this will make projects take longer. (Advocates could point out what regulatory fines and press exposure will do to the company's stock price.) The author also urges companies to follow one of the oldest data privacy principles: Don't collect more data on people than you really need. But with today's emphasis on CRM and terabyte-size data warehouses, I'm afraid that advice will be ignored.