Software Outsourcing

Monday, July 04, 2005

In 2004, 75% of the US companies did software outsourcing of all or some part of their information technology work. And with software outsourcing booming, in the year 2005, that will increase. This was mentioned in a report on outsourcing and offshoring by Horasis and Going Global Ventures. Out of that 75% of companies, only 32% of companies have done software outsourcing offshore and half of them have cut their full-time jobs.

Software Outsourcing to India

For software outsourcing, India is the most popular destination. And it will remain a leader in the year 2005 too. But according to the report, China will be the leader in the next ten years. This report also ranks countries base on their risk, costs, and opportunities for software outsourcing for now and also for the future. This report was compiled by Frank Jrgen Richter, president of horses, and Mark Minevich who is an international strategic advisor and principal at Going Global Ventures. Going global is US-based consulting and venture advisory firm while the Global visions community is a geneva based strategic advisory firm. Software outsourcing is a very hot issue because of fears of job loss. Because of that there is high oppose to it politically as well as by some organizations. But cost-saving is such a huge that, corporates are going to work on this strategy. But corporates need to look at benefits, cultural difference costs saving, risks, etc. for each country.

The report mentions that currently India, china, costarica, Czech Republic and Hungary are the top 5 destinations for software outsourcing. But in 2015, China, India, the US, Brazil, and Russia will be the top 5 countries for software outsourcing. The report was prepared using two different indexes – global outsourcing index – GOI and future outsourcing rank FOR. The GOI index is made up of the cost of doing business in each country, risks associated with it, and market opportunities. While future outsourcing index was made up of assesses the long term competitiveness of the top 30 future outsourcing countries.