Daimler in talks to outsource more back-office work to Indian IT firms
Daimler opens a new back-office IT services centre in Bangalore that will create 800 new jobs
Bangalore: Daimler AG, whose marquee brands include Mercedes-Benz, said it is in talks with Indian information technology (IT) software services firms to outsource more of its back-office businesses as it attempts to cut costs in a tough operating environment.
The German auto maker, however, did not disclose the names of the software firms, citing confidentiality.
On Monday, Daimler opened a new back-office IT services centre that would create 800 new jobs as it seeks to tap into India’s vast pool of engineering talent.
Daimler’s global chief information officer Michael Gorriz said the company would increase its IT spending next year, as it looks to invest in product development and newer areas of technology such as mobility.
“Spending will grow, but more conservatively than revenue growth," Gorriz told reporters in Bangalore.
Daimler, which works with IT services vendors such as Infosys Ltd, said it invests about 2% of its overall global revenue in technology. Gorriz said about 5% of the company’s overall IT spending budget is invested in newer technologies.
“Big Data is still a buzzword at the moment—you can only work on Big Data technology if you have Big Data capabilities. This will predominantly come when we start collecting data from our cars which is a project that will go live very soon. I’m talking months, not years," said Gorriz.
Gorriz said that the company had also started “in-sourcing", or bringing back higher-value projects that it had previously outsourced into its captive centre in Bangalore.
“More than 70% of our annual IT spends happens through the partners. We are partly insourcing the works to our Bangalore centre," said Gorriz.
Infosys handles infrastructure outsourcing services for Daimler.
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