software outsourcing

A blog related to software development company and offshore software outsourcing

Thursday, March 16, 2006

Offshore Outsourcing markets are being misplaced

According to report, which covers the global sourcing market, Offshore Outsourcing markets are being misplaced with the finding of contradicts by current thinking that labor arbitrage as their primary value proposition of IT and Software Outsourcing development and it will only be sustainable for more than five years. According to the new report released by one of the famous research institute, the key cost saving benefit of offshoring is labor arbitrage, and that will continue to drive the Offshore Outsourcing decisions for the up-coming years.

The fear of rapid wage inflation and growing skills shortages in country like India and other Offshore Outsourcing markets are being misplaced, says managing director of the Research Institute. The findings shows that the wages are raising for a relatively small base of Information Technology-workers and those shortages are cropping up only in certain skilled areas. The issue would eventually work for them as the Offshore Software Development labor market continues to mature and expand into new geographical areas.

The line of bottom is that the Offshoring is becoming main-stream with more than 75 percent of clients for offshore services, the organizations will continue to benefit from the competitive advantages of labor arbitrage by some good numbers, with the labor market continues internationally, it allows organizations to embrace offshore outsourcing as a long-term strategy and not simply a short-term fixture. It serves information for corporate enterprises, to service providers and investors in the international business process of IT and Software Outsourcing marketplace.

Offshore Outsourcing Globally

Some of the key findings of Offshore Outsourcing globally included, that market is definitely going to reach upwards to more than 160 billion dollar by year 2009, according to research agency, that predicts, the global market will continue with the demand growth. The jobs are moving permanently to offshore countries. Jobs are outsourced to offshore locations which are more likely to move for Software Outsourcing market than return to their own country of origin, the labor arbitrage is sustaining by a rapidly developed and expanded Offshore Outsourcing marketplace.

The non Information Technology market, that has virtually non existent before five years, will represent half of the offshore outsourcing market in coming three years. While in the case of using of third-party suppliers for dominating offshore business in IT and Software services, organizations prefer to use captives for Offshore Outsourcing in BPO services.