software outsourcing

A blog related to software development company and offshore software outsourcing

Monday, November 06, 2006

Future of offshore software outsourcing

Offshore Software Outsourcing has an ability to hold skilled foreign staff or software employees in a small part with minimal overhead cost that is exhilarating to several entrepreneurs for their companies. The resource utilization, especially in the sectors like Information Technology with software development projects, accounting, network security, HRM, advertising, animation, health care-related jobs, financial investment and consultancy, legal services where Offshore Outsourcing is making their mark.
Couple of centuries ago, when the colonial powers went for raw materials from respective colonies & sell these products after processing into manufactured commodities, such sale gave arise the concept of Offshore Outsourcing.
In the nineteenth century the British and other imperialist rampage the small scale industries in India and other respective nations due to industrial revolution; they started selling processed goods to the natives having a better quality. Now in 21st century the tables seem to have turned by taking benefits of the cheap labor in developed nations, many MNC’s have set up their subsidiaries in India and in other neighbor countries such as Malaysia, Africa, China, Israel, Ireland, Russia and given the name of Offshore Outsourcing.
By matured Software Development Companies the burn up time & budget on proper product innovation is much less than what one might think. In 2002 year, Offshore Software Outsourcing fell by merely 2%, after having consistently grown at 15% annually since year 1998. By big accounts for less than 30% of the R & D budget the small piece of the pie is being further clutched from remaining directions. First of all, Research &Development spending by public USA Offshore Software Outsourcing companies are also lessening from their experiences.
Let’s move to the second part of Research and Development budgets, which had been consumed by ever-increasing activities of application maintenance such as bug-fixing, up gradation and minor enrichment. Maintenance of agreements with huge customers base mount up over the years mandate this support. The globe saw that in the previous decade by Offshore Outsourcing, USA firms alone have invested more than $7 billion in their subsidiaries located in India, which got net saving of near about $26 billion.
Software Offshore Outsourcing organization could not successfully produce real advance with restricted resources. Many of the Software Developer would be more than happy with better suited, truly pioneering work. This is where Offshore Software Outsourcing Development can facilitate. In most of cases, a software program with well-execution could help release an added 20% of the Research &Development budget for new innovation while continuing to meet the maintenance obligations of mature organization by Offshore Outsourcing.