Today’s emerging technologies laced with automation is becoming reality, changing business landscape on continuous business improvements to save cost, disruptive social media and fast commoditisation of services is redefining the IT outsourcing models to new levels what wasn’t before.
The inherent nature of the industry driven by intensive skilled human resources who are integral part of software creation is fast changing with adoption of automation tools that can minimise the human resources involvement now. Largely driven by innovation, today’s evolutionary technologies, the software development has undergone faster changes from traditional SDLC phases on erstwhile Integrated Development Environment to today’s DevOps, is fast becoming the adoption in the industry.
So the question is whether the Indian IT outsourcing continue to grow at the face it has grown over the last two decades? Can the Indian IT outsourcing absorb the large volume of technical workforce in coming year? Does the global IT outsourcing demands continue to give larger consumption space to Indian IT outsourcing supply?
“India ranked number one in the annual report 2016 by A.T. Kearney which produces approximately 800, 000 technical engineers every year is the biggest producer of skilled manpower; is a game changer to global IT outsourcing to feed $110 billion outsourcing market”.
Improved education system, globalisation of education and cross-border-culture business opportunities, buoyant young engineering graduates, thriving start-up ecosystem will continue to generate vibrant business environment in the information technology industry. However, will the global IT outsourcing industry continue to accept traditional price models of IT outsourcing based on mere headcount of engineers or time and resources used? Certainly, not!
Today, outsourcing without significant value differentiation, improved productivity and innovation will not make any impact to enterprises to consider outsourcing. Global companies are looking more than capacity building, time and cost to outcome based approach where business can see substantial value system in the overall outsourcing agreements.
Five important and differentiating factors to consider while outsourcing:
- Innovative Services: Outsourcer should identify the experience of outsourcee organisation to measure their ability to deliver innovative services with deeper understanding on the technology and industry knowledge so that they can get added value over the low cost.
- Information Security: Data security continues to be a major concern for enterprises when the technology and devices adoption is increasing, more threats and vulnerabilities are surfaced on everyday business. It is the paramount importance that how service provider can tackle such challenges.
- Process and productivity improvements: With evolutionary tools, processes and methodologies, frameworks, the service provider should have highest maturity to demonstrate how well they are equipped to implement such industry proven productivity systems that can drive efficiency in the whole outsourcing engagements.
- Automation: With new technologies like Artificial Intelligence (AI)/Machine Learning (ML), Robotic process Automation (RPA) around the corner, outsourcer have to rethink sourcing strategies by creating differentiation between human functions and automated functions. These automation technologies not only minimise human intervention, but bring significant cost reduction, speed and improvement of business functions/processes.
- Agility: Companies focusing on scalable, efficient and visible systems, agile development framework can connect the stakeholders to make predictable business outcomes over the frequent planning and review cycles.