India Losing Status as Offshore King?

June 28, 2008


India is losing its stranglehold as the outsourcing destination of choice as China, Morocco, and Hungary gain ground.

Fewer global delivery centers were opened in India by the United Kingdom’s 20 largest IT services suppliers than in each of the three countries over the last year.

The competitive Indian labor market is driving companies to alternative destinations, say Pierre Audoin Consultants (PAC) in its report.

The 20 largest U.K. companies analyzed in the report included Accenture, BT Global Services, Capgemini, Capita, CSC, EDS, Fujitsu, HP, IBM and Logica.

Of the 21 centers opened since January 2007 by the big 20, only two were in India, while four were in China, with three were Eastern Europe and Morocco respectively.

Nick Mayes, senior consultant at PAC, said there is no "serious threat" to India’s outsourcing dominance in the short term but companies are looking to reduce their reliance on "India’s heated labor market".

China’s emergence as a global sourcing hub has traditionally been slow but the report found that BT Global Services, EDS, IBM and Tata Consultancy Services (TCS) have all opened sourcing facilities in the country in the last 18 months.

The two facilities launched in India were both outside the traditional hotspots of Bangalore and Mumbai—IBM’s new center in Noida and TCS’s expansion site in Hyderabad.

Source : http://www.businessweek.com/

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Offshoring giant exapands to Michigan

Wipro Ltd., a rapidly growing Indian IT, engineering and business process outsourcing company, has plans to expand their operations in Michigan.Wipro Ltd. has recently entered into a new lease in the National City Center building on West Big Beaver in Troy. The new building is located very near to Quantech Global Services LLC, Wipros first presence in the area. The Bangalore, Indiabased company has been immensely successful and now sees Michigamn  n as ripe with talent and opportunities.

The company has had ongoing discussions with state officials regarding future expansion opportunities, said Sridhar Ramasubbu, CFOAmericas. The Troy office is the first step towards bigger plans for Michigan, Ramasubbu said. The companys software development centers provide outsourced engineering services, applications management and business process management. The new Troy office ultimately could house 100 employees.

The Michigan center will be part of a global recruiting strategy that leverages local talent for Wipros outsourced engineering services. This center will look at supporting the engineering services, but could be expanded to offer the other services as well, Ramasubbu said.

The Detroit Regional Chamber has organized two trips to Wipros headquarters in Bangalore. Maureen Krauss, Oakland Countys deputy economic development director, said officials were impressed by the culture of the company and by its commitment to training employees and expanding worldwide.

The scale of its Michigan expansion would depend on Wipros success attracting engineering customers to its new Detroitarea office, but could grow to as many as 500 employees, Ramasubbu said. We understand there is good engineering talent available, hightech talent, and wed like to see if we can make use of this talent.

Source : http://www.offshoringtimes.com/

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