Benchmarking Synopsis: Outsourcing at Bank of America

Bank of America Outsourcing

University, Course #,

Professor

DATE

Bank of America Outsourcing

Issue Identified in Company

The central issue that I have identified in this article which relates to the Global Communications scenario is the implementation of plans to realize significant cost savings by shifting hundreds of technology jobs to India, Singapore, and China. Dean Foust (2006, para 4), in his article, explains that Bank of America(BofA) IT executives estimate a savings of approximately $100 million since 2001 by offshoring some work that was previously performed in the US and the UK. But just as important was the retention of highly skilled and motivated employees that the bank realized whenever it develops new products and services.

Concepts Applied in Response to the Issue

Three concepts in this article apply to the Global Communications scenario. These concepts are organizational commitment, continuous commitment and organizational communications. McShane and Von Glinow, (2005, pg 126), define organizational commitment as, "the employee's emotional attachment to, identification with, and involvement in a particular organization." They define continuous commitment as, "when employees believe it is in their own personal interest to remain with the organization."

The Foust article explains that Ms. Barbara Desoer, Chief Information Officer, noted that in 2001, the biggest complaint she heard from the departments that her technology teams supported was that the IT staff, "takes too long, costs too much, and is not on schedule enough." By shifting some programming work offshore, BofA was able to convert itself into a 24-hour company.

With respect to organizational communications, Barbara Desoer explained that when BofA announced the offshoring plan, employees were up in arms over the abrupt style in which BofA began shifting some programming work to India and elsewhere. Morale plummeted when some BofA highly skilled and motivated technology workers, who were losing their jobs, were instructed to train their Indian replacements. Desoer said, "We had to re-think how we handled similar transitions." (Foust, 2006, para 11)

The Foust article explains that BofA experienced employee morale and performance problems due to the inadequate notice