As IT companies declare surprisingly optimistic results over the last quarter of 2009, industry experts claim that the worst in IT outsourcing seems to be behind us and that it is time to look ahead at positive trends throughout 2010.
When it comes to the IT outsourcing market, it seems that we have always been ready. It started with menial data entry jobs and low skill clerical work. While continuing with that, Indian companies upgraded their competency levels and started attracting low to mid skill application maintenance jobs. With the vast pool of engineers and innovative management minds coming into the business, a big wave of BPOS and KPOS swept the country and is still going strong.(Though BPO jobs are lately being lost heavily to Philippines though)Along with these developments, a parallel path of piece meal product development started hitting the Indian shores. Offshore Product Development needed higher levels of skills and companies managed to put together systems to generate those skills and delivered superb results. This is when MNCs started coming and opening offices all over India and the latest trend has become the outsourcing of R&D processes to Indian offices of MNCs like Google, Microsoft, Oracle etc.
Companies are setting up centers here because of the vast untapped pool of engineers and scientist in India and most of the giants like HP, IBM etc generate more than 50% of their revenues from the emerging markets outside US. Moving to India is a part of the strategy to keep the research close to the customer.
What this means that as we have moved up in the value chain, the entire product lifecycle from research to product development to maintenance to voice & non-voice support to menial data entry is happening at the highest level possible – within India! From low skill call center work to high caliber IP generation, we have a talent pool that has stood up every time the outsourcing industry has stretched its hand towards it and we can now start to imagine that we have the experienced resources becoming available in all of these disciplines.
So much so, that for the opponents of outsourcing, ‘losing jobs in the US’ is becoming a secondary stand and the “US Outsourcing away its competitive edge ” seems to have become a more powerful argument. As far as India is concerned, outsourcing has done a fabulous job and continues to be powerful in its place. But it is definitely not an answer to everything. In a BBC radio show debate between Shashi Tharoor – out Current minister of state of external affairs and Niomi Klein – Canadian Writer, even the all optimistic ‘Soft Power’ claim of Shashi Tharoor falls short of being convincing and he does agree that Outsourcing is not a final answer to everything for technology in India. But are we ready or at least on track towards the next step – a “product revolution” to march ahead of the services revolution?
With the vast pool of engineers and now, the experienced pool of professionals catering to every level of the value chain being available within India and with the proximity to most of the fastest growing markets, are we now in a better position than ever to be able to defy the odds and wash off the label of a ‘stagnant innovative and invention technology ecosystem’ that has been applied to us continuously by almost anyone reporting on this topic?
We have had champions within the service industry, master managers who have handled teams of hundreds to dish out world class software for companies throughout the world. What is stopping the champions of our product industry? Is it our culture that discourages risk and looks down upon failures, poor infrastructure, brain drain, or our history of being used to providing ‘services’ to foreigners?
All the MNCs coming to India have shown us that we have the talent and skills that can be leveraged to respond to the highest levels in technology. Are our entrepreneurs, investors, mentors and startups READY enough to use this same talent, the advantage of availability of experienced talent due to the globalization of R&D processes in technology and put into action the next technology revolution for India ? Or is outsourcing going to be our best answer for the mention of ‘technology’ for years to come?
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4 Responses to “Has outsourcing made us READY for the next technology revolution in India ?”
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Agree with you for most of the points you have made. I think the problem for lack of entrepreneurship spirit in India lies more in the education system and the whole culture surrounding it. Educational institutes must provide encouragement in the form of incubators for budding entrepreneurs(the infrastructure for converting innovative ideas into real products). We also lack the venture capitalist’s support as they have it in the US. But despite these drawbacks we are seeing a lot of hope through a good number of start-ups coming up with gr8 ideas…
Things have started.
Outsourcing in medical field has also incresed Lot of scope is there Of laye many accidents have occured because of abnormal timings to & fro from call center so many intelligent young people r not ready to join call center jobs Something must be done fotr the same
I have the same opinion. The recent past has actually witnessed our economy go into overdrive. I believe what we are spectating now is only a appetizer of bigger things to come in the coming decades. While our striking strides in the IT business have been largely accountable for energizing our growth, I can see increasing number of industries unionizing the curve. Characteristically what really stimulates me is the prospects for so many diverse growth leaders in this phase.