BPO, Offshoring terms may be replaced by 2015

BPO, Offshoring terms may be replaced by 2015

By SiliconIndia   |   Saturday, 26 July 2008, 05:01 Hrs
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Mumbai: Owing to the business model transformations, IT dictionary, by 2015, can replace words like business process outsourcing (BPO) and offshoring with business service outsourcing and global delivery model (GDM). "In five to ten years, you will see a dramatic change in the way people are serviced. In fact, there may be no such word like BPO or offshoring," asserts Nasscom President Som Mittal.


The industry expects to have large firms with multiple lines of services across low-cost delivery centers as reported in Business Standard. Forrester's billion dollar babies like Tata Consultancy Services (TCS), IBM, Accenture and Infosys are expected to spread its workers throughout the globe in different industry verticals, as they lead by contributing more than 46 percent of total IT services export from India. It also foresees the tier-I firms to have large operations in West through acquisitions and aggressive investment procedures.

However, in this IT race the firms with lower profits will cut in their clients to save on investments on both onshore (U.S. or U.K.) and offshore (India). Even special economic zones (SEZ) will not be an attractive option unless a revision of the act ensures tax benefits beyond 2010 for them.

Moreover, there will also be a lot of consolidation, especially with smaller firms being bought out by the bigger ones, says Monish Chatrath, National Markets Leader, Grant Thornton. Apart from these, there will be tier-I firms who will constrain their services to the Indian bench and to low-cost geographies. And even the tier-II firms will be subjected to the vagaries of growth dynamics in their chosen industry or technical domain says Siddharth A Pai, Partner & Managing Director, TPI India. While the industry itself shall project a different look with Nasscom's prediction that software and services exports will touch $60 billion by 2010, an exact consideration of the 2015 conditions is not attempted by anyone with the current precarious trend in Indian rupee-US dollar valuations.

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