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More and more US firms are admitting to offshore outsourcing solutions now that presidential elections are over, according to one of the biggest IT companies in India. Wipro Technologies says the appetite to outsource is more on display than ever before because companies want lower costs not campaign rhetoric. Vivek Paul, vice-chairman, rejected the idea that either political candidate could have influenced the spate of contracts from American firms shifting operations abroad. “Neither [John Kerry or George W Bush] would have had an impact on outsourcing. Now that elections are over, saner minds will prevail.” In a speech last week, Mr Paul said there was not only more outsourcing but also a diversification of the process, ensuring simple jobs in India are being joined by ones that are more complex. His comments follow evidence from his own company’s survey, which found two-thirds of Fortune 500 companies rated cutting costs as the best reason to outsource. The survey showed that two years ago offshoring was at a pilot level importance for 50 per cent of firms, whereas today it is a business-wide initiative. As a result, Wipro said India faces “unbounded opportunity” but must address certain threats to its commercial success, such as its struggling infrastructure and outdated labour laws. The Indian firm said offshore outsourcing was not proving the answer to the country’s problems, as some perceive. Research shows IT accounts for just 0.2 per cent of jobs, while manufacturing exports provided a collective sum of only 2.0 per cent. Vivek Paul of Wipro said solutions for India lie in reforming labour laws, improving infrastructure and appealing more to foreign capital. A recent poll of Indian outsourcing companies, including Wipro, Infosys and Tata Consultancy Services found they all ranked in the lower half for customer satisfaction, with only Tata achieving a value approval from IT executives. The responses from over 300 IT professionals in the Information Week Survey showed most aren’t overly satisfied with their offshore experience, rating it an average 6.4 out of ten. On the staffing side of outsourcing, the survey revealed almost a third of US organisations increased their IT jobs despite taking on offshore agreements the same year. One company, which reportedly has increased its IT head count, even turned to its outsourcing partner, IBM, to provide skills it lacked in-house to create a launch pad for new projects. Here in the UK, the National Outsourcing Association has recently held its first awards ceremony, which will “help outsourcing develop the respect and credibility it deserves.” Best SME Outsourcing Operation went to Tenon Outsourcing, while best IT Outsourcing Deal was awarded to ITNET, for the Lichfield and Staffordshire-Moorlands District Council projects. Nov 25, 2004 Email this article Printer friendly page Previous Page
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