Ed Coco, a senior managing director for GE Real Estate, told GlobeSt.com at a lunch meeting yesterday that one of his company's strengths is in its diversity. One aspect of that diversity is in its global business. Coco is national sales leader for North America lending for the company and says that 60% of the firm's business is in its global markets. The opportunities are there, he said, and it also allows the company a hedge, should either US or global markets slow.
One issue for GE and other firms to watch out for is protecting data when dealing with global markets. A panel discussion yesterday titled "International, Offshoring and Other Trends," focused on global data protection and the implications outsourcing has on privacy issues.
Panelist Lisa J. Sotto, a partner with Hunton & Williams LLP, said countries such as India, where much of the outsourcing takes place, have come under global scrutiny due to lax data protection laws. However, that scrutiny has not been relegated to other parts of the globe. "Mexico doesn't really have [data protection laws] in place yet" and the US is not beyond reproach either.
The European Union (EU), which has the most stringent data protection laws, does not view the US as having enough protection in place. "The EU will not move data from Europe to America without having legal basis in place," Sotto said. This legal maneuvering can put a hold on the data move for months and even years.
Sotto said the watershed year for data protection occurred in 2005. Sotto called it "the year of the security breach." The problem gained national exposure in February of that year with ChoicePoint suffered a breach. Since that time, more than 430 security breaches have been reported, with more than 100 million people potentially affected.
MBA chairman-elect Kieran Quinn, in a released statement, agreed that global data has become a major issue facing financial and capital markets. "In light of the global nature of information, and the ease and speed with which personal data travels around the world, businesses will need to contend with widely varied regulatory schemes worldwide," Quinn said.
According to yesterday's panel discussion, data problems are not relegated to privacy issues. At times, the offshore entity could be: reluctant to provide the information; provide the information in the wrong format; or not have the information at all.
With all those headaches and potential roadblocks, one panelist rhetorically asked, why outsource offshore in the first place? Ken Beyer, president of global real estate services for OfficeTiger, offered an explanation. His firm has added 700 people to its India operations, and, in doing so, has restructured the company's organizational model from a diamond shape to a pyramid structure.
"With offshoring, you think first about saving money," Beyer said. "But it's more than just money saving, you have to think globally, too. It's best to take advantage of the 24-hour service that working around the clock provides."
MBA's Commercial Real Estate Finance/Multifamily Housing Convention & Expo is being held Feb. 4 through today at the Manchester Grand Hyatt San Diego. According to company officials more than 5,000 people have attended this year's conference.
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