Is Indian Offshoring Advantage For Eternity

Is Indian Offshoring Advantage For Eternity

Maveri

Offshoring Offshoring describes the relocation by a company of a business process from one country to another. Offshoring refers to taking advantage of lower-cost labor in another country.

Why Outsource Your IT? Each firm has their own internal motivations for considering an Outsourcing Strategy • “IT is not my company’s core competency, we need to focus on what we do” • “My company is overspending to maintain its IT Resources” • “We need to be more agile in our IT Initiatives

Wh y?

q30-50% cost reduction for off shored process

qAccess to talents qThe Advent of Globalization

st

Qu a

Co

qLow Attrition rate

lit y

qFaster and Better Communication

qEnglish Advantage

q24 ×7 service qLearning effect /specialization

od uc t Pr

qFaster turnaround time

iv

ity

India’s Value Proposition

qIT Optimization

qHigh skilled Labour

Fl

ex i

bi li

ty

qEase of rampup & down to reflect business volumes qFlexible, results-driven engagement models qReduction of

6

9

During DAY time processing of the data.

During NIGHT making and taking calls from the clients and it’s customer

24 Hours

Source : GSLI Index (2007)

Source: Census Survey, 2005

17

9

Edge over age ChinaMale 2008

Population in (millions)

Female

Male

India-2008

Female

Population in (millions)

11 19 Source: US Census Bureau, International Data Base,

India continues to rank as the preferred destination… Likely to benefit disproportionately from Offshoring Drive India - the Preferred Offshore Destination Vendor Sophistication (Number, Quality)

Indi a

2004

2008

Philippin es

China CIS Mexic o

People Sophistication (Number, Cost, Language Skills)

C ost

Irelan d

Isra el Singapo re

Mexic o Hunga ry Chin a

Malays Philippinia es

Indi a

Russi a

Quality of Supply (Resource Availability, CMM Level, Cultural Fit)

India Low Cost High Quality Developme Source: Nasscom

Source: McKinsey-NASSCOM study

What it is in India?

Export of offshore services

Source: NASSCOM, Strategic Review 2005

Wh y? Chosen for

INNOVATION OF OFFSHORING

THE NEW 3 DIMENSIONS OF OUTSOURCING

LP O EP

20 37 Source: Evalueserve

KPO Trend

21 38 Source: Evalueserve

Growth engines.. • The labour factor • Time factor • The large talent pool

Talent pool • 19 million students are enrolled in high schools • 10 million students in pre-graduate degree courses • 2.3 million graduates (4,41,000 engineers) • 0.3 million post-graduates

27

33

Th e

Significant cost advantage qLabor

qCapital

q Labor management

''Offshore outsourcing was triggered by the intention to cut costs, but now it's not just driven by cost factors,'' Karnik,President, NASSCOM Source: Giga Research, 30 23 a wholly owned subsidiary of Forrester Research Inc

Relationships with Software What is a Software Technology Park? • Subsidized real estate • Tax Breaks • Affordable housing • Legal and Accounting services • Close proximity to fellow IT Firms • Assistance with funding and attracting FDI • Close proximity to technical schools and universities The india have paid close attention to the success of U.S.

Highlights of STPs • 100% foreign equity is permitted. • Import duty exempted. • Permitted to the domestic market. • Tax benefits.

RURAL INDIA

Conclusi ons •We are only at the start, and not at a mature state, of the offshore industry evolution. •The pace, breadth and depth of offshoring business is rising. •Global demand will exceed near-term suitable talent supply in every country.