Data Privacy and Security Concerns in Outsourcing

Indian companies are establishing India's reputation as a trustworthy outsourcing destination by proactively addressing data privacy and security concerns.

Why is data privacy and security one of the foremost concerns in outsourcing to India?

Data privacy and security are not new concepts in outsourcing. When there is transfer of sensitive and confidential information, security concerns about data leakage or misuse do arise. For anti-outsourcing lobbies, data privacy and security concerns are cited as one of the main reasons to curb outsourcing. Some consider the security risks to be the same if the data were handled offshore or onshore, while others are unsure about the data privacy and security laws in countries like India and view it as a serious deterrent to their decision to outsource.

Whether or not the security concerns are baseless, companies in the US and UK are under increasing pressure with legislations that mandate the privacy of customers' financial and medical data. Indian companies realize that they need to scale up their data privacy in order to address these security concerns before there actually turns out to be a problem. From individual companies to associations like NASSCOM, proactive measures are being taken to ensure that India's unique value proposition is "trustworthy outsourcing".

How is India dealing with data privacy and security concerns?

Most data privacy and security concerns of companies outsourcing to India are unfounded. But the Indian government and associations such as NASSCOM are working towards ensuring that data privacy laws in India are on par with international legislation.

NASSCOM: The National Association of Software Services Companies or NASSCOM is working with the government to address security concerns in outsourcing to India and to ensure that India's data privacy legislation is more in line with the U.S. It also intends to have the security practices of all its 860 members audited by international accounting firms. A cyber crime unit, which NASSCOM initiated in Bombay's police department where officers were trained to investigate data theft, is planned in nine other cities.

NASSCOM also encourages Indian companies to share information on back office workers, create a certification authority for safety and plug gaps in Indian laws by familiarizing themselves with international laws.

Proactive Data Privacy Measures in Indian Companies

Indian companies have already put in place or are currently honing their data privacy and security measures even before the government finishes with the legislation. Employees access their work place with the use of swipe cards, conform to prescribed modes of data transfer and shred notes of client conversations after the shift ends. Visitors are not allowed into the working area of a BPO company. Third party call center operations in India and back-office subsidiaries of global companies such as General Electric, are adding state-of-the-art systems to monitor phone conversations, prevent data misuse, and to ensure total compliance to data privacy and IT security measures.

A recent incident of data misuse by an employee of a well-known BPO in India has resulted in rising security concerns about outsourcing. Whether global clients dismiss it as a one-off case or the episode unleashes a fresh round of BPO backlash, it is clear that vendor companies in India are focusing not only on network safety features but also on the quality of employees that they hire. There has been an increased focus on:

• Data privacy legislation: Regulatory bodies and companies are pushing for comprehensive data protection, security and privacy legislation in India along the lines of Europe, U.S. and UK to address security concerns of customers.
• Technology: companies in U.S. may want to see more investments in new technologies such as keypad authentication of PIN numbers for credit card processing etc.
• Legal enforceability of SLAs: The US and European customers will have greater confidence in Indian vendors if their contracts are made legally enforceable, both in their home country and in India.
• Background checks of candidates: HR will have to adopt best practices for comprehensive screening and background checking of all new hires, as is done in countries like the U.S. and UK.

Data Privacy and Security Measures at Outsource2india

Outsource2india has made substantial budget outlays for data privacy and security. Our core team of data privacy and IT security experts has ensured that proactive processes are in place to prevent security breaches and data misuse, rather than having to address such mishaps after they arise.

O2I’s well-defined data privacy and security measures are built into our processes as well as our IT infrastructure and network.

Data Security at O2I: Process

• Non-disclosure / confidentiality agreements
• Audit trails for all system activities
• Access to registered and authorized users only
• Scanning of servers for penetration testing

Data Security at O2I: Network

• Total secured CISCO VPN Tunnel to client
• Secured Cisco® Intelligent switches and Cisco® Network Assistant optimized for LAN
• Cisco® PIX® Firewall to block all ports for HTTP, FTP, TCP/IP, UDP and even ICMP
• Virtual Private Network (VPN) protection and Secure Network
• Secure network firewalls
• Secure Encrypted Web Servers and laptops
• Biometric Access

Data Security and Privacy measures for O2I employees

• Secure Smart Card and Secure Premises Login
• Secure Remote Access (VPN)
• Single sign-on to enterprise and desktop applications

Despite technology-driven protection devices and timely detections mechanisms, we recognize that our employees’ attitudes towards data privacy are key to addressing security concerns of our clients. We conduct detailed back-ground checks on candidates before they are hired. All our employees are bound by confidentiality agreements and are adequately trained in data security processes.

Data privacy and security: India initiatives

India is pursuing the tag of "trustworthy outsourcing" with a fierce determination. BangaloreIT.Com, an IT summit which was held in November 2004, focused on outsourcing and issues related to privacy and data security. It is organized by the Department of IT, Biotechnology and Science and Technology in association with Software Technology Parks of India, Bangalore. The event saw 400 companies from India and 14 other countries participate. International business experts, companies, and IT professionals educated the participants on key issues like best management practices in outsourcing, wireless technology, third-generation technology and information security among other things.

India as a trustworthy outsourcing destination

The proactive measures the government and individual companies have taken have definitely made an impression. Hill & Associates, an enterprise security and risk management consultancy firm, conducted a study which revealed that Indian cities Bangalore, Hyderabad and Mumbai are low risk outsourcing locations. India is not only moving up the value chain by offering more complex services, but is determined to establish its credibility as a trustworthy destination for outsourcing.

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