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Inside HP's new US$1 billion outsourcing plan

Stephanie Overby | Nov. 11, 2010 spoke to Rasmussen and Jeff Womack, VP, Best Shore enablement, about HP's increased focus on cost cutting and offshore delivery, its pursuit of domestic business in emerging markets, and the criticism that HP doesn't adequately value the IT services business.

Womack: Just as HP has embraced open standards from a software point of view, in services we have strong affinity for industry standards. We not only maintain our own rigorous standards so the learning curve is minimal when we transfer work from one center to another, we're using industry standards such so if you want to go back in-house or, heaven forbid, to a competitor, the transition should be seamless.

One of the major concerns for outsourcing customers, particularly legacy EDS clients, is that services is not the focus at HP. To some, the appointment of your new CEO and chairman denotes a further move away from services. How do you plan to demonstrate to more of a commitment to your services customers?

Rasmussen: Geez, I think the billion dollar investment is good affirmation from the board of directors that services is continuing to be important to HP. Service quality has to improve and improve and we've been vigilant about that. [This investment] involves five or six areas, one of which is the client experience and how to elevate that. We're working on different kinds of client interfacesthe people who deal with the clients. We're also refreshing our portfolio so that it's the most modern and appropriate for buying needs today. We're investing in our infrastructure and data centers.

Will any part of this billion dollars be invested in cloud-based offerings. Will HP be acquiring additional software capability, opening new datacenters, or making other investments in this area?

Womack: That is a separate investment. But a lot of our "best shore" centers will be involved in remote monitoring for cloud-based offerings.

Five years from now, what will differentiate HP from other service providers now that it seems all the big players have a captive hardware business, everyone is developing deep offshore capability, everyone has a central delivery center in the U.S.?

Rasmussen: Integrated solutions. If you look at what HP has-from hardware to software to middleware, to onshore and offshore-it's the breadth of portfolio and how we interlock that together. Very few will have that full solution to sell to clients.


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