Consumers Energy keeping outsourced jobs in Michigan

When Consumers Energy decided to outsource some of its information technology work, it didn’t go the usual route of sending jobs to India and other countries.

In a twist, the Jackson-based company is using an India-based company to create jobs in Michigan.

This fall, HCL America will officially open a technology development center near Consumers’ headquarters. It will be staffed by new hires, not Consumers employees.

Consumers will also be consolidating the IT work it had previously outsourced to hundreds of contractors in the U.S. and around the world and bringing these jobs to the Jackson center.

This kind of arrangement — keeping outsourced jobs in the U.S. — is called nearshoring.

A 2011 report from PricewaterhouseCoopers and Duke University’s Center for International Business Education and Research found that nearshoring is a growing trend, driven by increased competition among outsourcing firms and demand from clients.

“It’s easier to coordinate, to contact and to visit if you are within your own time zone,” said Arie Lewin, CIBER’s director.

Another major Michigan company, Dow Chemical, is also keeping some outsourced jobs in the state.

The chemical giant’s new 205,000-square-foot Business Services Center in Midland has more than 800 Dow employees and contract workers from Tata Consultancy Services that perform a variety of tasks in areas such as finance, purchasing and customer service.

In Jackson, the HCL tech center will initially employ 100 IT workers, adding 200 others by 2014. They will handle IT operations for Consumers, the tech center’s anchor client.

HCL hopes to gain other customers and employ a total of 500 contract workers within five years. In the U.S., HCL operates three other tech development centers in North Carolina, Washington and California.

The outsourcing will enable Consumers’ IT department to concentrate on projects such as interactive smartphone apps, said Mamatha Chamarthi, Consumers’ vice president and chief information officer. Its IT employees are split between operations and projects.

“Our customers want much more information from us and much more action,” Chamarthi said.

In the past, consultants would be hired to do some of the utility’s projects. Consumers employs 7,700 workers in Michigan, including about 2,000 in Jackson County.

Chamarthi said the utility does not plan to shrink its IT department, which has a few hundred employees. Companies that outsource their entire IT departments are making a “big mistake,” she noted.

“As a technology organization, we cannot be losing our technology talent,” Chamarthi said.

Originally posted by Katherine Yung at

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