India still holds the ace in global outsourcing market

It is a known fact that countries like Philippines and China have been increasingly making their presence felt in the outsourcing market. Philippines has emerged as a key player in the outsourcing market with advantages like neutralised accent, low cost of manpower, advantage of time zone etc. Philippines, is now constantly threatening the leadership position which was enjoyed by India and a lot was written in 2011 speculating that India has lost its position to this South Asian nation.

The latest statement made in Rajya Sabha by Minister of State for Communication and IT Mr. Sachin Pilot on behalf of Government of India bursts the myth that India has lost its position to Philippines. The Minister said that India still enjoys the leadership position with estimated revenue of USD15.9 billion in 2011. According to the reports of NASSCOM, Indian BPO industry has grown by 20 times in the last one decade to reach revenues of USD 15.9 billion in 2011 which is more than what was recorded in 2010 that is USD 14.2 billion. These figures are considered to be impressive considering the fact that the growth has been sluggish in the IT and ITES sector because of global slowdown. Though the figures re-establish the fact that India has achieved a good growth but the fact that Philippines is fast catching up with India cannot be negated.

Government of India and Organisations like NASSCOM and BPO association are trying hard to give a new fillip to the IT and BPO industry in 2012 and tackle competition from countries like Philippines. Government is continuing with its policy of providing incentives to IT sector and as part of that is offering IT and CST exemptions, concessions in SEZ etc. A forum has been created by NASSCOM to address the challenges faced by the industry. BPO association has plans to organise 26 conferences BPO across India. These conferences will have representatives from the industry and government discussing on various issues related to the scope and growth of the industry.

The India outsourcing business entities are trying to recapture the market by offering flexibility in the range of services offered to the customers. They are also trying to adapt newer business pricing models so as to garner the attention of customers. The key to success for the BPO firms in India would be to offer more non voice based services and generate better value proposition for their customers.

We are also seeing a new trend of Indian BPO’s expanding to rural areas, opening up new onshore/onsite centers as well as getting into higher value chain services like business consulting to global enterprises.

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