Clients Thinking About Contingency Plans In Wake Of Infosys’ Continued Visa Woes

Infosys’ continuing visa issues are causing concern for Infosys clients. While at first, the problem sounded isolated and related to a single whistle-blower, the continuing coverage suggests that the problem may be more widespread. Two recent events are increasing client concern. First, there was a CBS Morning News broadcast which seemed to support the original whistle-blower’s accusation. Then, Infosys itself disclosed that the U.S. Department of Homeland Security had found errors in a significant percentage of I-9 employment authorization forms. 

To make matters worse, clients are puzzled by Infosys’ lackluster response to these charges. For sure Infosys has denied all charges, but this is not a sufficient response to clients that rely on Infosys to keep the lights on every day. Clients are worried about things such as: the impact on Infosys visa-carrying employees if Infosys does “lose” the whistle-blower case or is penalized for irregularities in its I-9 processing; and the public relations risk if Infosys becomes an  election year scapegoat for American job loss. Clients want to understand what the worst-case scenario is and work with Infosys to mitigate potential risks. So far, Infosys’ response has been to re-iterate that there is no risk. However, a good sourcing and vendor management expert knows that he or she needs to do more than hope for the best.

So what should clients do? Well, I will tell you what some Forrester clients have been doing: putting contingency plans in place to insulate themselves and their companies from risk. This includes:

  • Asking Infosys for documentation about the visa status of all on-site employees.
  • Ensuring that all documentation related to Infosys staff activities is up to date and stored on the clients’ network.
  • Determining which on-site Infosys resources are mission critical and determining whether they are permitted to hire this staff in the event of a problem.
  • Discussing possible disruption with alternate suppliers to gauge their ability to accommodate Infosys’ workload should the need arise.
  • Discussing with alternate suppliers their ability to hire Infosys’ staff should the need arise.

Clients are hoping that Infosys will start working with them individually to explore worst-case scenarios and discuss which measures can be put in place to ease their concerns. Infosys has always been considered a reliable and scrupulous industry stalwart, but its response to its recent visa problems (not the accusations, but its response to the accusations) is making clients question their judgment.

Comments

India's future?!

Hi Stephanie,

Nice read. In fact, this problem of visa denial is affecting most of the India IT service providers. In addition, the Rupee fluctuation and decreasing labor arbitrage is creating additional jinx.

How and where do you see this going? Will it be a sustainable business model in the future for India or will emerging geographies leverage this opportunity?

Contingency Plan for Infosys

Nice piece Stephanie. My father use to say, "Do you know when money has it's highest value? When you need it". This should be a wake-up call to all companies that leverage an outsourcing model that requires visas, not just Infosys. The advice you provide should be something that every outsourcer does with every vendor they work with. Why wait for a problem (when we all know one will come along sooner or later)

That said, outsorucing is one of the hardest professions I have ever worked in, and the people who do well in this industry are some of the toughest and most creative I have ever met. This is just another speed bump on the road we travel.

Not really

That said, outsorucing is one of the hardest professions I have ever worked in, and the people who do well in this industry are some of the toughest and most creative I have ever met.

It's hard running outsourced systems but hardly very creative.

Infosys

Get in touch with me.....

Best,

JP

Is the alarm justified ?

As a former Chairman of NASSCOM ( the Satyam crisis was handled in my tenure ) I can say that these fears about Infosys seem somewhat exaggerated. All of us must and do support the letter and spirt of the visa regulations in US and I am sure clients should have no cause for concern with any reputable company in the Indian IT industry

Global liberalization was not

Global liberalization was not only for product, it was for services as well. It is unfair on part of any country to target companies operating in service space as these are soft targets. US took lead in building this flat world by assuming responsbility of super power and supplying its product all over the world. It has benefited US as well as other nations, companies and overall harmony among countries have improved significantly. Now any conservative step by US will only divide the world again and roll back the progress made so far in this century.

This analysis is not based on any market survey and can not be treated as authentic analysis. How can somebody trust this analysis without any supporting data to prove.

Risk Management, Or Risk-Based Selling

While it is fair to advocate a principle-based cause of stepping up procurement risk management in light of series of events, it is unprofessional, and definitely uncalled from an authority like Forrester to really have a "so what should clients do" checklist as the real focus of the entire blurb. It raises a question as to whether Forrester has given into encashing media frenzy for advocating... rather creating specific trends- which is sad, because executives globally rely on your brand for neutral and top quality output in terms of information.

The opinionated nature of this write-up stands out and is a an eyebrow raiser. The edits at Forrester need to ensure that this is guarded against at all times.

It is about business ethics,

It is about business ethics, I just read PMI article on ethics, and I found your article. I do not believe such a big Indian IT giant like Infosys is doing such practices.

It is hard to believe, Narayan Murthy is such a great leader, I have seen his list of achievements in wikepedia site, it is so sad to read articles like yours, though they are in reality it is bit emotionally upsetting.

Sometimes I think Obama administration is very right in escalating VISA fees, the best part is his administration is dontating that money to 9 11 victims, that signifies they really dont need that money, it is being used for donation, even though having such a robust health care government services in their country.