Negative headlines about the fund industry have been featured all year long, but so far fund firms have side-stepped the outsourcing controversy even as the issue has become a political hot button. Well, a recent article by Beth Healy of the Boston Globe may paint that bulls-eye on the funds. Healy reports on Fidelity hiring new workers (54 currently) in Bangalore, India and that Ned himself is very interested in the Subcontinent.
that the 54 job openings in Bangalore are listed on the Boston Behemoth's Web site (along with 34 job openings in Merrimack, New Hampshire).All counted, she reports that Fidelity has hired 756 people in India during the past two years. The fund firm is responding to market pressures, according to Healy.
"Our India experience has been all about a growth strategy for Fidelity. Every major western business is in India," explained Stephen P. Jonas, president of enterprise operations and risk services.
The article is one of the first to document offshore outsourcing in the fund industry (although the MFWire has been told of many more cases of outsourcing outside of Fidelity). The fund firm is seeking senior test engineers, operations managers, and senior mainframe developers with experience in mutual funds, according to its Web site.
Fidelity has been in Bangalore for two years, but is still ramping up its presence. In late summer it 125,000 square feet of space and plans to add yet another 75,000 square feet later this year.
"On the institutional side, we have clients who require an offshore strategy and those who prohibit it," Jonas told the paper. He added that Fidelity can accommodate both sets of clients, though it charges companies wanting service from Americans only a higher cost.
Fidelity mostly uses its Bangalore office to administer 401(k) plans, and run payroll and benefit plans.
One job Fidelity has not sent overseas is its phone rep positions, partly because it is not sure how customers would respond to talking to someone outside of the U.S. about their investments.
"I wouldn't rule it out as a long-term possibility," Jonas told the paper. "There isn't anything inherently different about human beings in India or Indiana. Over time, the world gets used to people with an accent."
Meanwhile, Fidelity International started handling financial customer service for European fund investors more than a year ago.
"We took our first customer call into India in June 2003," Simon Haslam, chief administrative officer for Fidelity International told the Globe. "For the most part, the reaction from customers has been to be perfectly happy."
Fidelity International, is based in London has been in India since 2001 and now employs about 600 people in the Delhi suburb of Gurgaon. Jobs there include systems development, desktop support, and back-office administration for European funds. The COLT Telecom Group is also moving several hundred phone-representative jobs to India from Germany and England, reports the paper.
In September, Fidelity Investments joined with Fidelity International in founding an Indian joint venture -- Fidelity India Shared Services Partnership -- that will "invest in entities which carry out the operation and administration of an Indian software and operational support business."
The Indian company will provide services to both Fidelity's, allowing the firms to share the human resources, finance, and other administrative functions.
Haslam told the paper that Fidelity Chairman Ned Johnson "has become very interested in India" and that "He's already been out to see some of our operations, and I think took a very, very keen interest in the opportunities for technical support and customer support."
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