Everest Research: IT Buyers Expanding Global Sourcing Networks Beyond India
According to a report by Everest Research Institute, outsourcing firms are seeking new global networks as part of their plan to reduce their dependency on favored destinations like India.
The report read that events like terrorist attacks, fraud and bankruptcies among vendors, and typhoons have added to a need for risk management in the area of outsourcing.
Initially, the report said, management of risk in global outsourcing concentrate on engagement-level management of performance. Nonetheless, the report outlines a more thorough approach of managing risk. This kind of risk management looks at risk from the perspective of the whole sourcing ecosystem - this would include each individual outsourcer, the delivery locale along with combined portfolio of locations and vendors, reports The Economic Times of India Times.
The Everest Institute adds that a new worldwide outsourcing model is surfacing and this is generating a drive toward a delivery network that is global. Everest reported that this new shift in perspective about outsourcing is linked to a more sophisticated demand profile associated with a global delivery network. This would lead to a delivery footprint that goes beyond the traditional offshore location, India. Considering this new paradigm, clients will have more offshore destinations to choose from since the aforementioned factors are creating a demand for global destinations that favor business process delivery and technology.
The Everest report identifies these new regions as Central and Eastern Europe, Brazil, Mexico, Israel, South Africa and the Philippines. Outsourcing firms cannot ignore these locations because they represent areas that are superior in skills or represent markets that have massive talent.
The typical suppliers in these markets comprise of an amalgam of major players, regional vendors that have ties to the emerging market, and suppliers with links to Indian vendors extending their delivery channel.
Some of these vendors in this category have established an operating scale that is significant. Additionally, by adapting to industry practices and by investing in delivery capacities, these suppliers are able to service Global 1000 firms.