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Showing posts with label BPO services. Show all posts
Showing posts with label BPO services. Show all posts

January 11, 2008

Global Outsourcing to Grow 8% in 2008

Global Outsourcing to Grow 8% in 2008: Businessweek reports that there will be growth "worldwide in the IT outsourcing (ITO) and business process outsourcing (BPO) markets.

More companies are favouring smaller deals and splitting services between several providers and countries, the Gartner report found.

This shift away from large high-value deals is partly responsible for the fact that publicly reported BPO and ITO contract values fell by 50 per cent in 2007.

But organisations are also still failing in their IT sourcing strategies and governance structures when drawing up outsourcing agreements, Gartner said.

Kurt Potter, research director at Gartner, said in a statement: 'Because these organisations lack the basic building blocks for successful vendor management and outsourcing success, expected cost savings and other benefits are difficult to obtain.'

Spending on offshore services is three times higher in North America than in Western Europe but the gap is closing, with Indian providers becoming more popular in 2007, growing 40 per cent in the US and 60 per cent in Europe.

Research VP at Gartner, Ian Marriott, said other countries will continue to emerge as challengers to India, and added that strong demand is putting a strain on the Indian labour force, with staff attrition and cost increases remaining high."

However personally speaking , I see a lot of challenges Indian companies have to face , if we want to remain leaders in Global Outsourcing. For one , with the looming recession in US economy, and the sub prime crisis which is yet to hit Indian BPO's hard enough, Things can only begun to get worse from now on.

With the rupee showing more signs of strengthening, against the dollar,there is no doubt about the fact that bottomlines of several BPO and ITES services would start to get affected unless they move up the value chain and start to offer high end consulting kind of services . Its very abvious that we cannt forever remain a low cost back office operator for long.