| India has always been the first choice for outsourcing | | | | lower their prices. Coupled with smaller deals and |
| due it its geographical advantage, high level education, | | | | current situation vendors will be forced to reduce their |
| its capability to work hard and smart and lower cost | | | | margins to grab these deals. |
| of operations. Being a co-founder of an IT services | | | | Terms and condition: Large companies with |
| company, I am certain that the most critical question | | | | comparatively bigger outsourcing deals will arm twist |
| for Indian IT and BPO industry would be "Is outsourcing | | | | their vendors for stringent SLA and Deliverable. So |
| recession proof" I wish had the answer. My belief is | | | | vendors will have to deliver more at lower cost to get |
| that the answer has to be yes, primarily because | | | | deals and stay competitive themselves. |
| though it's important to ensure there are jobs available | | | | Opportunity for smaller players: The Indian IT services |
| for local people but at the same time in current | | | | industry is largely governed by the big 5 as far as |
| economic scenario it's important for the companies to | | | | bigger deals are concerned but the new cost |
| stay competitive. | | | | structures and stringent deliverable there will be an |
| So for companies/ countries that outsource it's a catch | | | | opportunity for smaller players to compete with the |
| 20 situation and a double edge sword. If they decide to | | | | biggies. |
| create government policies which will ensure that local | | | | In current scenario everyone is thinking to outsource or |
| jobs stay local then the local companies tend to lose | | | | not to outsource. There are always 2 sides to a coin |
| the chance of being competitive globally. These | | | | and similarly there are people who come from |
| companies have huge scale of operation would really | | | | different school of thoughts. I have done some |
| find it difficult to sustain. As a result i feel outsourcing is | | | | preliminary research which suggests an increase in |
| recession proof and in fact i would like to think that | | | | Outsourcing deals. |
| outsourcing will see an increase as recession will force | | | | Outsourcing in the news (2009) |
| companies to cut the fat and become lean and mean | | | | The Good |
| to stay competitive. | | | | * Hindustan times in partnership with Google have |
| My gut feel is that during economic downturn people | | | | developed an election portal to offer information about |
| will outsource more and the primary driver would be to | | | | the constituencies. |
| cut down costs. Increasingly we will see a change in | | | | * Xerox will pay $100 million over six years to |
| the mental models of companies and vendors alike. | | | | outsource data-center services to HCL Technologies. |
| The forces that will initiate this change are: | | | | * JPMorgan to up outsourcing to India by 25% |
| Don't forget to download "2009 the year of | | | | * IT majors sign new deals at a discount |
| outsourcing dangerously" the Black book of | | | | * Recession-hit Japan turns to Indian IT Co's |
| outsourcing at the end of the article. | | | | * India will remain a top outsourcing destination |
| Economic pressure on companies: The government | | | | because of its tech-savvy and English-proficient urban |
| and general public would try and create policies and | | | | workforce whose wages are much lower than their |
| procedures to try and protect local jobs. At the same | | | | western counterparts says Moody's |
| time companies would want to outsource more and | | | | * Outsourcing will continue to grow in 2009: Gartner |
| more to save cost. It would be interesting to see how | | | | * AstraZeneca outsources IT to India's Infosys |
| these companies will beat this dilemma. | | | | * Premier Foods renews outsourcing deal |
| Deals getting smaller: I foresee that increasingly deal | | | | The not so good |
| will get smaller but grow in numbers as companies will | | | | * IT outsourcing prices will fall - Gartner |
| try and adopt a mix between non-core and absolute | | | | * Recession may drive re-thinking of some outsourcing |
| non-core and also create a healthy mix between | | | | deals |
| keeping jobs local and getting it outsourced. | | | | * India's Outsourcing Woes |
| Falling margins for vendors: The dollar rupee equation is | | | | Download "2009 the year of outsourcing dangerously" |
| anyways enabling companies to push vendors to | | | | the Black book of outsourcing. |