- Offshore Outsourcing: Fad or Trend?
- Trend #1: Offshore Business Models Are Growing
- Trend #2: Outsourcing Firms Are Offshoring
- Trend #3: Product Engineering Is Headed Offshore
- Trend #4: Offshore HR and Transaction-Processing Apps Gain Momentum
- Trend #5: New Offshore Project-Management Skills Are Needed
- Conclusion
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Trend #2: Outsourcing Firms Are Offshoring
Surprising no one, professional services and outsourcing firms have begun to build up their nearshore and offshore presence. For instance, human resources giant ADP has been ramping up its captive subsidiary, ADP Wilco, in Hyderabad, India. Convergys, the customer care outsourcer specializing in the telecom industry, is also escalating its operations in India.
In parallel, BPO companies such as Accenture and Perot Systems are accelerating their offshore capabilities. Recently, Perot Systems decided to extend its offshore team by buying out HCL Techologies' shares in HCL Perot Systems (HPS), a joint venture of the two companies. In its press release, Perot Systems explained that acquiring HPS complements the company's onshore/offshore application outsourcing model and increases its global software team. This acquisition allows Perot Systems to compete with global consulting giants such as Accenture, which have been adding thousands of employees to their offshore offices. The company also intends to negate the cost advantage of Indian companies such as Tata Consultancy Services and Infosys.
What does this mean for you? Outsourcing firms like Accenture, Convergys, IBM, and HP are the most aggressive in migrating offshore. Expect to see more outsourcing companies execute offshore outsourcing under the label of global or blended outsourcing. If you work for any of these firms, you need to evaluate your job to see whether it's a potential candidate for offshore substitution.