Offshoring stumbles on Nationwide barrier

Nationwide Building Society has bucked the trend by rejecting offshore options for its call centres, but this will not stop the financial giant looking overseas for IT development work.

The UK's largest building society is planning a substantial investment programme in new call centres and jobs in the UK, including the opening of a new call centre in Sheffield and major refurbishment of existing facilities in Swindon and Northampton.

Nationwide claimed that the move will result in improved service for customers and call centre employees. The company employs nearly 800 people in these locations, handling 18,500 calls and emails a day.

But the building society has already outsourced application development work offshore, and a spokeswoman told vnunet.com that future use of overseas IT services companies was a distinct possibility.

"As far as I'm aware we're not using offshore IT development at the moment. But we would reserve the right to look elsewhere for IT development," she said.

"We are very mindful of costs and we would do it if it made sense for the company. There are a lot of emotional issues surrounding offshore, but this has been driven by the needs of the business."

The call centre decision is in contrast with a trend that has already seen 10,000 financial services jobs move to overseas call centres.

Only this week rival Abbey announced that 400 jobs would be transferred to Bangalore this year as the high street lender closes call centres in Warrington and Derby and reduces headcount at its Bradford centre.

Insurer Axa, meanwhile, is slashing its UK headcount by 700 as part of a restructuring. Almost 230 of those jobs may be moved to Bangalore.

Some analysts are predicting a backlash against offshore outsourcing following concerns about the quality of service delivered by offshore providers.

A new report from research firm ContactBabel found that productivity in Indian call centres lags behind UK counterparts, with UK staff resolving 17 per cent more calls the first time round.

Phil Codling, an analyst at Ovum Holway, said: "There's a lot of talk of a backlash but the number of jobs being offshored in IT, back-office functions and call centres will continue to increase, not just to India but to other countries."