Everest Research Institute released the first issue of Market Vista “Global Sourcing—Market Vista Q1 2008” , which is a robust quarterly report on global outsourcing, offshoring activity, and trend insights. The quarterly Market Vista report provides data and analysis across multiple dimensions, including deal trends in the outsourcing, offshoring market, captive model analysis including new center announcements, expansion and divesture, current and emerging location analysis including risks and opportunities, etc.
In this report, India has emerged as the most matured location for offshored IT and BPO services, though this dominance might be chipping away given the rising costs. The cost inflation in Indian cities is exceeding the 2007 levels and this has increased the risk of labor arbitrage closing very rapidly.
Report further says, India, Philippines and Eastern European countries such as the Czech Republic and Romania have experienced substantial offshore activity. New locations are emerging as potential offshore options such as Thailand, El Salvador, Paraguay, Uruguay, Honduras and the Dominican Republic. The appreciation of the Brazilian Real is likely to reduce Brazil's cost arbitrage from about 35 to 25 percent. Wage inflation in Argentina is likely to spike due to the increase of minimum wages by 10 percent in Q4 2007. In some Central American cities, particularly Monterrey, increase in player activity has fueled concerns around labor pool pressures in the medium term.
Overall India still able to managed its leadership position due to matured outsourcing processes, bandwidth of quality talent, adoption of industry best practices & English language advantage. To maintain this lead, Indian IT & BPO industry need to work on future talent availability, leadership development, increasing productivity, agile processes adoption & effective cost containment.
