India has always been a preferred destination for the outsourcing industry. The reason why India is the hub of outsourcing is because it has a large talent pool of skilled workers coupled with cheap labor cost. India also has a large English speaking population when compared to other counties.
The Indian BPO sector and information technology enabled services (ITeS) and are the currently growing sectors, in terms of generating employment opportunities and income.
According to the United Nations Conference on Trade and Development (UNCTAD), India is at present the major destination to 228 outsourcing projects, which is followed Britain with 187, 132 in China, 123 in America, and other countries. Singapore, Ireland and Germany have over 77 projects each.
Reasons for sudden downturn in outsourcing industry
Although BPO sector has been dominating the market growth in India, the recent changes has been projecting a decline in the Indian outsourcing industry. Once the most sought after destination for career opportunities for most graduates, the growth of the BPO sector has now started to dwindle.
The $30 billion IT/ITES services industry of India seems to be losing all its charm due to competitive advantages posed by other emerging destinations in the outsourcing industry. The Indian outsourcing giants like Wipro and Infosys are trying to diversify their business process by bringing in advantage that is technology driven.
Indian BPOs are today on the lookout for “mini CEOs” which is the latest buzzword. They are trying to cut down the entry-level operators and instead trying to build more multi-tasking professionals among professionals hired by these business giants.
Innovation and core competencies are what businesses are focusing on in order to save time and resources. Companies in India are focusing their attention towards quality systems rather than cost saving alone. It requires people with good industry knowledge and business insight who can propel their business value chain forward.
Companies are now tightening their belt when recruiting people. In the process, they are trying to generate more productivity with fewer employees. This calls for professionals who learn quickly and who are adaptable to the changing business scenario.
The dire changes and stiff competition faced by the outsourcing industry mainly in the BPO sector are the greatest challenge that companies in this industry need to overcome.
With increasing number of students opting for careers in IT companies and other sectors when given the choice, the BPO sector needs to adapt to the changes with more flexibility and value addition to retain and attract talented workforce.