The demand for the services of communications technology and related services is often a "derived demand," i.e., one derived from another industry such as automotive, pharmaceuticals, healthcare, energy, or another industry that might dominate a city or region. Support contractors and vendors who support such larger operations usually include information technologies and are co-located in such areas.
This aligns well with the findings of Gartner's annual survey of CIOs, which state that information technology is an integral component of business operations.
"Technology's role in the enterprise is increasing. This does not mean, however, that the role of the IT organization is increasing," says Mark McDonald, group vice president for Gartner Executive Programs and a Gartner Fellow. "CIOs concentrating on IT as a force of operational automation, integration, and control are losing ground to executives who see technology as a business amplifier and source of innovation. Effective leaders use technology, which includes IT, to strengthen the customer experience and eliminate costly internal distortions."
Proximity to Partners and Customers
Intact Integrated Services, a provider of managed information technology services which had its Americas division headquarters in Cincinnati, Ohio, recently decided to relocate to Carmel, Indiana. The company provides project, support and managed services solutions to the information and communication technology industry, including network development as well as maintenance and support services for Cisco products. The firm had other technology partners located in Carmel, Indiana. Its relocation provides better proximity to those partners and allows the company to engage such partnerships to better serve its customers.
"Relocating to Carmel - one of Indiana's fastest-developing cities - [provides] an excellent opportunity for Intact, as it gives us a well-connected hub to support the projected expansion of our activities across the Americas. In Carmel we're close to key Intact technology partners such as Cisco, and we're confident that Indiana will prove the right choice for Intact as we continue to grow our activities and hire talented individuals," notes Jeff Hamilton, managing director of Intact's Americas division.
Perficient, Inc., a leading information technology consulting firm serving clients throughout North America recently moved from Dallas to a new facility in Plano, Texas. The company sought expansion to accommodate customer needs that were best served from Plano. The Plano location better enables the company to develop trained and certified IT professionals for their Oracle Technology practice.
"Companies are increasingly challenged with improving the customer experience, accelerating work force productivity, and driving business growth, all while navigating a rapidly changing IT environment. As a result, Perficient has seen an increased demand for business-centered, information technology solutions," says Phillip Leary, general manager of Perficient's Dallas business unit. "This facility will accommodate our anticipated hiring needs and afford our consultants with the additional space required for ongoing education, training facilities, and better collaboration."
Interestingly, PFSweb, another Texas company that specializes in developing e-commerce solutions, made the reverse move - from Plano to Dallas - when choosing a new facility for its customer care center. The company felt that a Dallas location could better support its staffing requirements. The lease structure at the company's new Dallas facility, which will include an expanded customer call center, affords greater flexibility to support the firm's overall growth and its seasonal staffing fluctuations, while providing an overall improved working environment. The facility provides the ability to expand to up to 1,000 call center seats, whereas its Plano facility only accommodated approximately 400 call center seats.
On-Shoring and Rural Sourcing
Not surprisingly, the information and communications technology sector has seen many jobs go overseas in the past few years. Some firms, however, have avoided this and capitalized on the human resources available in their own backyard instead of relocating abroad or sending jobs there.
Liaison Technologies, a cloud-based integration and data management company, recently announced that it was not relocating, but rather expanding its presence in Carbondale, Illinois, with a larger facility and additional hires, touting its commitment to "on-shoring" and "rural sourcing.
"Liaison believes in finding domestic technical talent in rural communities anchored by a technical college or university. Because of the lower cost of living in rural communities, companies can offer competitive wages and benefits at a lower cost than they can in large metropolitan areas," says Larry Mieldezis, Liaison's COO. "For every person we hire in Carbondale, we would have to hire 1.5 in India or China. With our on-shoring initiative, we've found an avenue that is cost-effective and keeps jobs in the U.S. Our Carbondale operation has become our model for rural sourcing, and we hope our success here inspires other companies to follow our lead to bring technology jobs home."
Information and communications technology firms continue to expand by keeping pace with the demand and implementation of new technology such as cloud computing, mobile technology, and other innovations within business operations across many different industries. Firms seek locations to meet their capital and labor needs, and as the Gartner CIO survey indicated, they ultimately help their customers to integrate technology into their client's business operations and amplify it.