Outsourcing – The Popular Mantra

Outsourcing of customized services to India has proved to be a highly rewarding experience for a number of companies engaged in diverse businesses, all the way from IT and software development to pharmaceuticals/chemicals/healthcare/ biotechnology, etc. Outsourcing allowed them to free up a significant portion of their limited funds to fuel strategic investments and, in some cases, to fire corporate turnarounds.

Outsourcing can reduce the overall costs by 30 to 35%; these funds can then be diverted to focus on developing marketing strategies, for example. If executed and managed tactically, outsourcing has a huge potential to add to the shareholders’ value and keep the investors community happy.

The question that arises next is: Why outsource to India? Why not to any other country, for example? India as an outsourcing hub – be it for the IT industry, the pharmaceutical/healthcare industries or the BPO/KPO/CRO industries – offers unique advantages compared to other developing countries.

India’s success story in outsourcing information technology and software development is too familiar all over the world to be retold here. India exports software to 95 countries all across the world. Eighty-two percent of US companies have ranked India as their first choice for software and IT enabled service outsourcing. The success of the Indian outsourcing story can be attributed primarily to the following factors.

India is a talent-rich country, with a huge readily accessible pool of highly qualified doctors, engineers, software developers, research scientists, MBAs, CAs, analysts, etc., having operative level to proficient English language skills – thanks (i) to the Indian way of looking at education, with a great emphasis on higher learning and (ii) the highly competitive school/university level education system that lays special emphasis on subjects like mathematics, science and computers. These factors, combined with the steps being taken by the Indian government in liberalizing its policies, and in building of international-level IT Parks and Knowledge Parks, make India a favorite destination for outsourcing of brain power all across the world.

Moreover, India has the second largest population and the largest democracy in the world. India has a stable government and is one of the ten fastest-growing economies in the world. In fact, outsourcing to India is no longer only about cost-effectiveness; it is now more about high quality. Indian companies are fast scaling up to match or even surpass international standards.