Planet Outsourcing

India is witnessing a salary boom, all thanks to the shortage of skilled people in India and in 2007 Asian workers are expected to get the highest pay hikes in the world due to spiraling economic growth and mainly shortage of talent. Real wages are expected to rise sharply in 2007 with a fifty percent increase expected over the previous year.

Shortage of quality workers is affecting the quality of output from India and as a result work subcontracted from American companies is being further outsourced to other countries without the approval of the client in order to counter lack of skilled workers.

The salary boom is caused by the fact that workers are not viewing outsourcing industry as a permanent career option and see that they would be rendered unemployed over the next decade therefore they are asking for more salaries before getting trapped in outsourcing. I think they still can’t forget the scenario of the 30s and 40s which prevailed in India.

Via indiadaily

Now most of the companies are focusing on their core competencies and therefore they are moving towards outsourcing. Outsourcing has enabled them to focus on their major areas and that too at a fraction of a cost. One such area is logistic outsourcing and it is growing at the rate of ten to twenty percent each year.

Companies are moving from internal transportation to logistics outsourcing in order to unburden themselves. The logistics world is getting more complex and companies do not want to worry itself about these issues therefore they are moving towards logistics outsourcing.

Post 9/11 it has become a bit more difficult with new compliance laws coming in therefore companies are not willing to take any headaches in this regard and are therefore opting for companies which specialize in logistics outsourcing and hand over their worries to them.

Via crmbuyer

Companies opting for procurement outsourcing don’t seem to be happy with it and there are number of factors behind this dissatisfaction. Though they have struck good deals but still they still seem to be unhappy about it. There are a number of indirect procurement challenges which are causing dissatisfaction with regards to cost effectiveness of the indirect procurement services.

Even though companies have to reduce their cost of indirect goods and service still they are facing a lot of problems for managing their large number of suppliers due to a host of reasons such as lack of common indirect procurement, lack of adequate breadth of internal category management expertise and lack of common indirect procurement system.

Some of the other problems which are being faced are lack of information for managing suppliers and lack of market knowledge besides lack of visibility regarding indirect spending. Most of the companies are willing to access external expertise but the problems stated above need to be sorted out first.

Via echannelline

The Asian market seems to be leading in the demand for IT outsourcing services. These services are generally brought by North American and European firms but the trend seems to be changing and now these services are being used by companies within the Asia pacific region such as Japan, India and Australia. The figure of technology contracts for 2006 stand at $2.6 billion with the consumer list which includes Australia had a share of 32%, Japan had a share of 27% and India garnered a share of 25%.

India seems to be benefiting the most from this demand and has even beaten China in the process and most of the demand in the future is expected to come from India and Australia. The demand seems to be quite good but it needs to be seen whether IT outsourcing providers in the Asia region would be able to match the demand in the future or not.

Via ihotdesk

Data centre offshoring seems to be on the rise and is expected to grow in a big way in the next five years. Up till now companies were reluctant to take the benefits of data centre outsourcing but now the views seems to be changing and companies are willing to relocate their data centres for spreading their risks and pocketing significant savings.

David Elwen, Director, DMW said:

This research seems to show that the majority of IT managers believe that the trend is inevitable, but it is not a straight-forward process and it is vital that they make the right choices for their organisation and plan carefully for what would be a major change to a key service.

Some of the most cost sensitive sectors such as retail are quite enthusiastic about it and this seems to be a positive signal for the outsourcing industry which certainly stands to gain from it besides the companies which are opting for it.

Via itweek

Up till now megadeals ruled the roost in the outsourcing industry. These are deals which are more than worth $1 billion in value and act as a yardstick for acceptance of outsourcing in the industry. Now the scenario has changed and companies are adopting selective outsourcing and megascope deals are being regarded as the benchmark for big outsourcing contract signings.

If you would like to understand megascope deals then it refers to the enterprise wide scope of work which is to be outsourced and the work is offered on selective basis which matches the scope and requirements to the best fit provider.

Kurt Potter, research director, Gartner said:

Megadeals are still popular for large organizations, and megascope awards are gaining in popularity. However, such large deals are still only suitable for organizations that have mature sourcing processes and the experience to manage multiple providers. Fewer than one-third of organizations have a formal sourcing strategy, and many of them are using multiple providers and advanced sourcing practices

2007 will see the work being divided among a number of providers and bigger companies would be selecting smaller players for megascope deals which would lead to expansion of the scope of the services which are being delivered globally.

Via crm2day

The Chinese gaming outsourcing market is growing like never before and by the year 2008 this figure is expected to cross the $1.3 billion mark. The market for online casual games is rising steadily and it is expected to capture a share of thirty percent by the year 2008.

Companies which are outsourcing to China will be able to garner cost savings to the tune of twenty to forty percent in the areas of art creation. This outsourcing game brings along with it certain challenges too such as competition for the skilled people, quality of the product and protection of intellectual property rights.

This area in outsourcing has just started but most of the companies involved with this have already started to take precautions in order to prevent any challenges from raising their heads in this profitable outsourcing game. China will certainly stay in the game of games outsourcing as it has a command over labor, infrastructure and low wages and it will take a lot of effort for breaking this dominance.

Via globalservicesmedia

What has pushed email security outsourcing is that no onsite equipment or external access to private servers is required. All that needs to be done is to change the DNS MX record of the domain to point towards the mail gateway of the service provider which implies that first of all the mail is routed through their systems and the gateway of the vendor is a virtual address load which is balanced across multiple enterprise class filtering appliances which results in cent percent uptime.

Mails are thoroughly filtered for spam, inappropriate content and viruses and the blocked mails are manually reviewed. Since the filtering is external to the corporate network it does not interfere with the security devices of the company.

What email security outsourcing offers is convenience to the company and eliminates all network traffic related with spam. It also offloads the connection management related to running of an email gateway. On the other hand control over important infrastructure may be lost and reliability might not be delivered but here the pros are more than the cons and this form of outsourcing can certainly be exploited by the companies.

Via processor

One of the largest broadcasting corporations in the world, British Broadcasting Corporation or BBC as we fondly call it is facing some problems. Its employees don’t seem to be happy over work being outsourced to India. In order to express their unhappiness the staff of the company is on a two day strike.

The workers fear that outsourcing will cause job losses within the country. In order to highlight their plight their union is also contemplating launching a media campaign for creating an awareness regarding the risks which U.K public can face as a result of their bank details being handled by Indian call centers.

There are chances that the campaign launched by BBC staff might grab attention since it is one of the most respected corporations of the world and have a negative effect on the Indian outsourcing industry.

Via teluguportal

This is some really good news for India!! Companies from the West are eyeing the Indian publishing industry for outsourcing. A number of American and European publishers are eyeing this country for selling their titles which are being locally printed, packaged, priced and marketed.

Jack Romanos, President & CEO of Simon & Schuster said:

India is one of the fastest growing English language markets and a world class economic dynamo with a highly literate populace. It shows the relevance of India in the eyes of all international publishers.

The reason companies are getting attracted to India are that Indian publishing has garnered respect over the years due to a number of Indian authors earning accolades in the international arena and hence Indians stand to gain because of outsourcing and market for their products. Further, India has an edge over its rival China since twenty nine percent of its population speaks English which is much more as compared to China where English commands a secondary status. It seems Indian outsourcing industry will dominate in this arena too.

Via rediff