Software Outsourcing

Offshore Outsourcing

Although offshore outsourcing is increasing and more and more software outsourcing is going to India, not all entry level work is going to India. According to recent study by University of California, Bierkeley, researcher mentions that, by downskilling some information technology work which combined with some training program can provide low wage wroker a career ladder in IT industry. Berkeley professor Karen Chapple mentioned "Although some entry-level work is disappearing offshore, the economy still offers opportunities for jobseekers with little college education to work in IT"

Which work will not go for offshore outsourcing?

Majority of comapnies are moving low level coding type of work to offshore and in some cases they are also moving higher level of research and design work too for software outsourcing to the low wage countries like India and china. US employees are advised to upgrade their technical skills to provide higher end desinging work or combine business and technology skills. There is also a theory that, IT creates two poles in economy - high end knowledge workers and low skill service workers. But professor reached to the conclusion that, so called divide can be bridged, after interviewing more than 200 employees. She said, key is the entry level IT related tasks like computer support. This type of jobs require little training and college degrees compare to software development. Also, Chapple remained positive despite of software outsourcing boom that, some work will remain onshore. Also, she mentioned that, non profit job training programs are very helpful for disadvantaged people. But she was critical for some federal programs for job seekers.

TatvaSoft is a software outsourcing and offshore outsourcing company from India, ahmedabad with clients in US, Italy, France, UK, Spain and Israel.

Software Outsourcing growth

According to advisory firm TPI, offshore software outsourcing is going to rise. This research has included around 100 senior UK executives who are responsible for software outsourcing within their companies. According to survey 81 percentage of the total executives mentioned they plan to increase their offshore outsourcing over next few years while only 4 percent mentioned that they will decrease it.

Although, software outsourcing is increasing, research also revealed that, large companies are choosing to offshore their IT related activities to India and china by starting their own wholly owned subsidiaries rather then external service providers. Software outsourcing has grown, developed and now matured as a trend in today's business. Managing director, International Mr. Duncan Aitchison of TPI mentioned, "Our survey results clearly indicate that there is very little disillusionment with offshore outsourcing. What we can observe, however, is a general shift towards more sophisticated sourcing strategies as the global sourcing market comes of age. The growth of captives stems from companies now being more aware of how to conduct an offshore operation and less reliant on external service providers." He also mentioned, the build, operate and transfer model is becoming the latest trend in IT industry.

Survey also reveals that, many companies are taking global view of software outsourcing and separating proces to decide what is best for offshore, nearshore and onshore development. As outsourcing trend is increasing, UK buyers are seeing wider range of countries for offshore software development. Although India is a clear leader and used by 75% of the respondents, there is a close competition between central and eastern european countries and china for the second spot. Although currently used less, central and eastern european countries are reated attractive by 59% of the respondents. It is likely that, central and eastern european countries will increase their share in customer facing service for companies which are serving european market. Also, 41% of the respondents mentioned china as attractive location, although china is immature outsourcing destination and it lacks English speaking people. However, many companies are starting their subsidary company in china.

This outsourcing survey also focused on failur rates. It mentioned that, only 4% of the software outsourcing buyers are dissatisfied witht he service while 42% are very satisfied. While wide spread speculation is that, very high percentage of buyers are unhappy. Survey also revealed that 48% people believed that, outsourcing has improved customer satisfaction while 64% believed, organization planning has improved.

Nasscom introduce exams to improve outsourcing quality

Nasscom which is National association of software and servicing companies have launched national entry exam to improve quality of graduates who are recuited into call center and IT positions in the outsourcing industry. Initialy this three month pilot will run in Banglore, Delhi and Mumbai. It will cover 36 ke IT and business process outsourcing companies and 15000 graduates. Aim of this excercise by Nasscom is to improve graduates and make big trainable work force into an employable work force. It is believed that indian BPO and software outsourcing companies are employing around 350,000 people. But current employers are under very high pressure because of high attrition rate and lack of competent staff. By 2009, this industry will require around 1 million skilled people and thus companies will be under more pressure in managing their staff. Skill test by nasscom includes listening and typing skills, verbal ability and spoken english, numerical and analytical skills etc. After sucessful completion of this pilot project, nasscom will start national rollout which will result in the saving of around 50% cost of recruitement.