Indiana Workforce Agency Goes with Service Provider from India

Talk about a controversial deal. Listen to this one. The Indiana Department of Workforce Development helps out-of-work Indiana residents find jobs. But when the agency needed $15.2 million worth of computer upgrades to speed handling of unemployment claims, it hired a company based in India.

Indiana state officials acknowledge that hiring an overseas firm that competes with U.S. companies has raised public concerns, especially given their responsibility to put Indiana workers first, but they say the contract will save taxpayers millions of dollars -- and insist those savings won't come at the expense of jobs in Indiana. Tata America International Corp., the New York subsidiary of a Bombay firm, is scheduled to begin work Oct. 28 on the four-year project.

The firm won the state contract over two U.S.-based companies: Accenture LLP and Deloitte Consulting LP. Tata's proposal came in $8.1 million to $23.3 million lower than these two companies' proposals. No Indiana-based companies submitted proposals.

The Indianapolis Star newspaper is conducting a poll of readers to determine what the public thinks about the issue.

If you were the procurement director for Indiana state government, what would you do in a case like this? Remember that US-based companies, like Deloitte and others are providing a wide array of services to government agencies across the world.

I will admit that this is a thorny ssue and politically there is no simple way to explain the state's decision away, especially in light of the huge loss of American IT jobs to India and other foreign locations in recent years. At the same time, government agencies have a responsibility to get the best value for the taxpayer dollars they use.

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