Survey, Outsourcing, Offshore, NeoIT

neoIT survey identifies top corporate offshore outsourcing priorities

02 Sep 2003 | (Survey)

neoIT, the leading offshore advisory and management firm, announced today the results of a comprehensive survey of over 5000 U.S. and European IT and BPO clients and influencers conducted from October 2002 through February 2003. The results of the survey reveal business process outsourcing of financial services, human resources, and applications maintenance and support will provide the largest growth opportunity for markets such as India, Philippines, China and Russia, which have ramped up IT and BPO capabilities and infrastructure to keep pace with the growing global demand for low cost, high quality offshore outsourcing options.

The detailed survey results, available here, show an increase in focus on sourcing business processes, despite the somewhat skeptical perception that analysts are giving of new BPO markets and key players in those markets. Financial services, customer care, HR and payment services are fast-growth BPO domains and are likely to generate major projects for offshore markets in the coming months. Recent mega deals across the globe are indicators of more to come and include Wipro-Delta Air Lines, TCS-Lehman Brothers and Cognizant-MetLife.

Nasscom, India's software industry trade association recently raised its projections for the country's back-office services industry from $17 billion to $21 billion, by 2008. Their change is a direct result of an ever-quickening increase in the sourcing of back-office and IT service operations to Indian suppliers (eg. payroll processing or call centers). Similar high growth rates are expected in other emerging markets such as Philippines and China.

Survey participants weighed in on risk factors, ranking political unrest as their highest concern, followed by offshoring suppliers' domain knowledge and ability to deliver on commitments as the second highest risk area.

"The survey provides a realistic snapshot of outsourcing decision makers top-of-mind priorities and concerns," said Atul Vashistha, neoIT CEO. "By polling key IT decision makers, neoIT can adapt its advisory and management services to meet their needs, as well as provide real-time guidance to offshore suppliers who must adapt their service offerings to meet the changing needs of the market."

Survey data, which was gathered online, revealed the following results:

- Management and quality of delivery seen as biggest offshore outsourcing challenge
- Shared Services components and application support and maintenance top offshoring project plans for 2003
- Sourcing advisory firms for researching outsourcing providers and sourcing strategies outranked industry analysts and online research sources.
- Geopolitical risks, outsourcing supplier knowledge and delivery capabilities were seen as the highest risk factors.

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