Mumbai Bombings Shake Outsourcing Community

Even though the major firms came out of the Mumbai bombings unscathed, the attacks spurred a big reality check.

The big fear of offshore outsourcing customers has become a reality: a major bombing attack in an outsourcing hub.

On July 11, at least 200 commuters were killed by terrorist bombings in Mumbai, India, a key outsourcing locale.

In the wake of the attacks, outsourcing providers in Mumbai scrambled to make sure employees and customer data were safe and secure. Meanwhile, outsourcing customers sought reassurances that their Indian partners could handle future unforeseen events.

The terrorist attack in Mumbai—and conflict between Israel and Lebanon for that matter—raise a series of questions for companies sourcing technology globally.

Do you know the disaster recovery plans of your offshore services provider? Are their plans integrated with yours? And how prepared are these providers?

Louis Rosenthal, managing director of group shared services for IT for ABN AMRO Bank in Chicago, said he has inspected the readiness of his outsourcing providers, which include Tata Consultancy Services, Infosys and Patni Computer Systems.

"We were very explicit about the construction, operation, location, and resilience of the offshore development centers that our vendors developed for us. These facilities are in Mumbai, as well as a number of other cities," said Rosenthal, whose operations werent impacted.

India is no stranger to political violence or natural disasters. Unrest with Pakistan over the disputed Kashmir province has endured for decades and the annual monsoon season puts big cities like Mumbai at risk.

In July, 2005, Mumbai saw 40 inches of rainfall in a single day. Last year, many TCS employees had to remain in their offices or in nearby hotels overnight, waiting out the rains.

Last week the situation was different, as TCS workers took bus services and company-provided transportation home the night of the attacks.

Heres an early survey of how the leading players in India handled the Mumbai attack.

  • For Tata Consultancy Services, with 16,000 employees at 16 locations in Mumbai, including its headquarters, the margin between safety and disaster was narrow one.

Because Tata workers routinely stay at work until after 6:30 p.m., the hour of last weeks attacks, TCS several thousand employees who take Mumbais commuter trains escaped the explosions—no TCS employees were killed or injured in the blasts.

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Nonetheless, the TCS crisis management center in Chennai–on the other side of the Indian subcontinent–was activated.

With cellular networks jammed, Tata managers, augmented by human resources and security staff, contacted workers via the companys internal VOIP (voice over IP) service, e-mail and SMS, telling them to stay put and for those who were on the night shift to stay at home, said R. Vaidhyanathan, the TCS Corporate Crisis Management Leader in Chennai.

TCS backs up critical data at its Mumbai offices and in Chennai, and can operate there and in Bangalore.

  • Patni Computer Systems, which has major operations in Mumbai, was touched by the attacks. "One employees father was killed and another employees wife was on another car on one of the trains and was really spooked," said Russell Boekenkroeger, executive vice president of Patni in Cambridge, Mass.
  • Wipro Technologies, which has major business process outsourcing operations and several thousand employees in Mumbai, invoked its business continuity plans for the city, which call for processing to be transferred to facilities in other cities, according to a Wipro spokesperson.
  • IBM, which has touted its billion-dollar investments and some 40,000 employees in India, said through a spokesman that it did not suffer any casualties from the attacks and intends to continue with its aggressive investment schedule.

The company has 2,300 employees at its Daksh business process outsourcing unit in Mumbai

Next Page: The importance of business continuity planning.