GalaxE.Solutions’ big bet on Hartford shows faith in IT worker reshoring trend

Tim Bryan is convinced the United States is poised to experience a significant onshoring trend.

But he’s not a manufacturing executive frustrated by pandemic-induced supply chain issues, which have left key materials stuck on cargo ships or in foreign lands.

He’s a tech executive who believes back-office IT work — often shipped overseas during the last quarter-century to low-cost destinations — will come back to the United States, as companies go through a 21st-century digitization process, and the pandemic leaves behind a more decentralized American workforce.

And that could mean more jobs in lower-cost cities like Hartford, he said.

“We believe that offshoring, outsourcing as it has come to be understood over the last 25 years will change dramatically and come back to the United States,” said Bryan, who is the CEO and founder of IT company GalaxE.Solutions, which has made a sizable bet on downtown Hartford.

GalaxE recently announced plans to bring 180 new jobs to Hartford as part of an ongoing worker relocation project. The company originally planted its flag in the Capital City in 2019, opening up an innovation center downtown. It currently leases about 24,000 square feet — the entire 15th floor — in the City Place I office tower.

About 100 of those new jobs will be service desk positions currently based in the Philippines, and they are coming to Hartford because GalaxE recently added a new local client (he declined to name the company). This will boost GalaxE’s local workforce to 220 people.

Somerset, New Jersey-based GalaxE is an IT company that focuses on automating business operations within large corporate employers by leveraging machine learning and artificial intelligence. The 2,000-employee company targets the healthcare, insurance, retail and financial services sectors, and also focuses on developing a local workforce in areas where it operates. It has similar hubs in Detroit and Milwaukee.

While larger outsourcing companies might have as much as 90% of their workforce outside the U.S., about 50% of GalaxE’s employees are stateside. It targets smaller, less expensive U.S. markets to recruit workers to remain competitive on costs, and uses local partnerships to develop workforce development programs that yield a talent pipeline.

As part of its Hartford expansion, GalaxE said it will hire 60 graduates from the Hartford-based nonprofit Girls for Technology’s service desk training program, which will train young people — particularly Hartford residents between the ages of 18 and 29 who have a high school diploma or GED equivalent — for technology roles.

The city of Hartford is helping fund the effort with a $600,000 American Rescue Plan grant.

The so-called “Pipeline 4.0” initiative will offer a 10-week course that allows trainees to gain professional and technical skills through hybrid instruction, career coaching, mentorship and other avenues. Graduates will earn a job with GalaxE or other corporate partners.

GalaxE was first attracted to Hartford because it had Express Scripts as a customer. The pharmacy benefits manager was purchased by Bloomfield-based Cigna Corp. in 2018. After that deal, Cigna became a key GalaxE client and Bryan said he established a relationship with the health insurer’s former chief information officer, Mark Boxer, who convinced him to establish a Hartford foothold.

Despite the hit Hartford has taken from the pandemic, Bryan said he remains bullish on the city’s future. So much so that he’s still contemplating buying an office building downtown to further cement his company’s presence here. A deal isn’t likely in 2022, he said.

Bryan recently spoke to HBJ virtually from his home in Miami. Here’s what else he had to say:

Q. What does GalaxE.Solutions do? What’s the range of services the company provides? 

A. We are an entity that uses automation to solve business technology challenges for extremely large corporations.

Automation produces technological outcomes for customers in terms of building systems, delivering data, producing stronger business results, than human capital-generated systems.

We have married automation with human capital and then rely on a more local workforce.

We are tackling two major customer desires. One is they want their IT work focused on utilizing and developing automation, and two they are looking for workforce development in their communities — particularly underserved communities — at significant scale.

Those are two markets we’ve addressed, at least until this point, better than most of the largest outsourcing firms in the world that are still focused on human capital activity, with most of that — 80% to 90% — in foreign countries.

Q. What’s the scope of automation? 

A. You hear all the time migrating from legacy applications or systems to the cloud, for example.

GalaxE has automation that will analyze and capture a function as it exists today inside a corporate computer system, and understand how to migrate it. If you are doing that with human beings there is an enormous amount of guesswork going on, and oftentimes it breaks down, or takes longer and is more expensive to make the migration to the cloud.

GalaxE’s automation requires fewer people and is higher quality, which means greater savings, and if you overlay that activity with a greater reliance on domestic workforce, then you are looking at something that is very appealing for American corporations.

Our services include systems development, quality assurance and data management and security using automation.

Q. Who are your competitors? How do you differentiate from them? 

A. Our competitors are the largest outsourcing firms in the world. That would include Wipro, Accenture, Tata, Cognizant, Deloitte. They are asked, as we are, to help customers achieve business goals using technology. Our approach as a roughly 2,000-person firm, is obviously different from the approach of a 250,000-person firm.

We focus on automation and our domestic workforce.

Q. Why were you attracted to Hartford back in 2019 when you first entered the market? 

A. When Express Scripts was acquired by Cigna and became Evernorth we became a partner of Cigna’s and came to understand the opportunity to do work in Hartford and help the city with its renaissance and make Hartford a technology hub, similar to what we had done in Detroit, which had fallen on incredibly hard times.

GalaxE partnered with firms in Detroit and had an impact there in terms of developing a workforce that made technology a viable occupation in a reemerging American city.

We saw exactly the same opportunity in Hartford. We saw an untapped market. We saw a city that wants to turn itself around. We have customers in the city that want to find a mechanism to help Hartford rebound and make technology a cornerstone.

When we saw that opportunity combined with the educational institutions, workforce development programs in place or emerging, public-private partnerships with government ready and able to offer assistance, we made the decision to come to Hartford and build out a workforce that includes experienced people as well as doing workforce development in underserved communities.

Q. How did the pandemic impact your Hartford expansion?

A. Hartford, in my view, is not suffering more than anyplace else as a result of the pandemic. It has slowed down return to offices, but it has not slowed down the amount of work that needs to be done.

Frankly, what has enabled Americans to work from home is technology, so the investment by large corporations in technology has not slowed.

As a matter of fact, the emphasis on digitization is stronger than it was pre-COVID, so the opportunities for business and employment have risen.

Q. Are GalaxE’s employees back in the Hartford office?

A. We are paralleling our customers, but our downtown Hartford offices are open. We have the entire 15th floor in City Place I. It’s a beautiful office with incredible views of Hartford.

We are still mostly a remote workforce right now but we have protocols in place and a lot of our work has to be done on-site, so the office is manned every single day.

It will expand in terms of the number of individuals returning to work in the months and weeks ahead, presuming these variants remain manageable and people are taking reasonable precautions with their health.

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COSTAR

Marcum has its Hartford office on the 25th floor in City Place, at 185 Asylum St.

Q. Did the pandemic slow down your hiring in Hartford? Why are you adding these 180 jobs now?

A. A little bit. What’s going on now, though, is we’ve gotten really aggressive bidding for work.

For example, the new 180 jobs we just announced were related to one customer that I can’t name. That customer had a piece of work they assumed would need to be executed half in the Philippines and half in India.

GalaxE.Solutions bid the work half in Hartford and half in India and that was an innovative approach. That validated the theory and premise of us being here, that we can execute with jobs going into emerging cities instead of foreign countries and do so even further with an emphasis on workforce development in underserved areas.

Q. What kinds of jobs will be added in Hartford?

A. The nature of the jobs is that inside corporations, you have multiple, very sophisticated applications running all the time and those applications require a lot of oversight and care. So one of the major functions of this group is to monitor the plethora of applications that are going on inside a corporation and understand whether they need attention, or to be upgraded in order to keep them functioning optimally.

That is a stepping off point for many of these workers who will go on to be application developers, quality assurance engineers, analysts, project managers.

Q. Besides the partnership with Girls For Technology, what else is part of your workforce development playbook?

A. One of the major areas of focus right now is the education institutions. We like to go to community colleges and four-year universities to discuss very specifically what our needs are in terms of technology, training and headcount. 

We actually help drive alignment of the curricula within those institutions based on what our needs are going to be. 

Q. There’s a lot of debate coming out of the pandemic about the importance of cities in attracting talent. Are cities still important talent magnets, or has the fact that more people can work anywhere made cities less valuable?

A. During the pandemic we’ve understood people can be successful working remotely at least some of the time, and productivity and life gains can be worked into the equation.

It also means our workforce in the U.S. can be more decentralized so that our customers who are in Indiana or Wisconsin can work with our workforce in Hartford, and we can leverage that workforce across the country.

The pandemic’s lesson is that a more decentralized workforce can achieve productivity gains and make the U.S. more competitive with offshore workforces because we are able to tap into resources in cities where there are lower costs of living compared to places like New York City or Silicon Valley.

Q. Do you view the reshoring of IT workers as a trend?

A. Yes, and the crisis in Ukraine provides a good example of why it’s needed.

Many firms have offshore arrangements with Russian entities and outsourcing companies with thousands of Russian workers. Obviously the Ukrainian crisis is throwing that entire equation up in the air, ranging from not wanting to do business with Russian entities to not being able to do business with Russian companies because the banking system is cut off.

That type of scenario is predictable in many parts of the world that are less stable than the United States. So while offshore may have an appeal for certain reasons, like lower cost, you still have political instability to deal with and the vagaries of foreign governments.

Based on that, the decentralized workforce and the value that comes with proximity, the domestic U.S. workforce now is significantly more appealing, and that’s one of the reasons we are making such a large investment in workforce development inside the United States.