is indian offshoring advantage for ethernity (for the motion) (nep 2008 batch)
TRANSCRIPT
Is Indian Offshoring an advantage for
Eternity- For the Motion
An NEP Presentation by ILLUMINATI- FG2 Fall Winter 2008 Batch
“ We will create a system of education that will not change their colors, but will make them white in their thinking”
-Lord McCauley (19TH century)
Seed to Tree
Birth of Offshoring
Entered the language in 1980s.
Introduced by information system trade press.
Outsourcing Coined to describe growing trend
of transferring information system out of house to
3rd party company.
Source: Indian offshore Advantage by Ian Hunter
Offshoring is an extension of outsourcing where
relocation of work moves across geographical
organizational boundaries.
Offshore processes can be handed off to third-
party vendors or remain in-house.
Advantage of lower-cost labor in another
country. Outsourcing
Outsourced off shoring
In-house off shoring
Idea behind Offshoring
So that companies can focus on their
core activities and maintain control over
their strategic elements.
To increase profit margins.
To seek advantage by offshoring work to
countries which are cost effective.
Idea meets Advantage India
India Rising
Second headquarters of major companies like
GE, British airways etc..
Boeing 787 handed over cockpit maintenance
work to HCL Technologies.
Morgan Stanley hired Indians to perform
analysis of stocks.
Source: Boeing.co.in , Businessweek.com
Indian Offshoring Advantages
Under 3 Main Heads
Availability of large talent pool
Low cost
Fast turnaround time
Emerging Competition
India Philippines
India’s edge over Philippines
India leads Offshoring with 35% market share as
compared to 15% that of Philippines in 2008.
In terms of graduates at 480, 000, Philippines
lags behind India’s 30, 00, 000.
Challenges faced by Philippines
a. Specialized skills,
b. Access to quality management talent, and
c. Talent migration
India’s edge over Philippines
Philippines lags behind India when choosing an
Offshoring location, such as:
a. Risk
b. Infrastructure,
c. The availability of vendors, and
d. A paucity of skilled middle managers.
India’s edge over Philippines
India China
Points of difference
Human Resource and Knowledge
Management
Points of difference
Perception is Reality
China may fall victim to its own success
Cross Country Constraints
Industry
Growth Investment
ITES – Information Technology Enabled
Services.
BPO – Business Process Outsourcing.
KPO – Knowledge Process Outsourcing.
RPO – Research(Recruitment) Process
Outsourcing.
HRO – Human Research Outsourcing, etc.
ITES - outsourcing of processes that can be
enabled with information technology and
covers areas like finance, HR,
administration, healthcare,
telecommunication, manufacturing etc.
BPO-The contracting of the operations and to a responsibilities of a specific business function third-party service provider.
KPO- knowledge and information related work is carried out in a different company or by a subsidiary of the same organization.
RPO -Is a form of outsourcing where an employer outsources transfers all or part of its recruitment activities to an external service provider. HRO - Offer an array of Human Resource
Management solutions designed to reduce the costs of traditional human
Resource models.
Medical transcription
Customer support services
Technical support service
Exam result evaluation
Insurance processing
New Business/ Promotion
Policy Maintenance/ management, etc.
Direct employment to 1.5 million
professionals
There is a positive relation between high
skilled services and GDP.
It has led to the enormous infrastructure
improvements.
It has led to the development of SEZ.
Petroleum products
Others
Exports
Occupation Structure
Economic survey 2007-08
Offshoring is profitable for Indian ITES in the
case of rupee depreciation.
Engineering goods and IT services
contributes 30% to Foreign Inflows in 2007-08.
The competition for talent is heating up.
Harmonic political relations with other
countries.
RECESSION IN USA AND
OFFSHORING
WHAT IS THE CONNECTION ?
Will India sneeze when US catches a cold
?
Thanks to Offshoring
Offshoring is an integral part of the rising
tide in globalization
Its reputation for low-cost but high quality
work
Vast and growing IT labor pool being
trained to support global client base
Offshoring to India – a propellant on the
US economy
It is the business of America to design and
innovate
Jobs off shored create jobs within the
country
US exports will be billions of dollars higher
in the long run
International relationships could influence
the Offshoring policy of new government
The Next Big Thing in Offshoring
Engineering design Offshoring
Increasing trend of us based newspapers
publishers Offshoring to India
The delivery models are well established
India is well positioned to become a back
office for America
Indian firms are generating thousands of
new technology jobs
Will it last till Eternity ? The reported death of Indian offshoring is
greatly exaggerated.
Productivity and scale.
Salary increases with Productivity
improvements
Multiyear experience advantage.
Vastly improved its IT infrastructure.
.
Leverage in India's university system.
Moving to tier-II and tier-III cities.
Will it all last till Eternity ?
Education on a rise in India.
• -560 universities and 13,200 higher education institutions produce
an estimated 14 million employable workforce—the largest of all
28 countries MGI has studied.
The private spending on education -expected to
increase 13% to 15%
• It is estimated that by 2011-12, it will surpass Rs. 100,000 Crore
from just Rs. 26,883 Crore in 2000-01.
(Source: Ministry of HRD, Government of India, 2006-2007).
Although China has increased expenditure on
education, it only accounts for 3.01 percent of
the GDP in 2006 (Source: Article in Beijing News.)
• Pune • Chandigarh • Ahemedabad• Jaipur • Rajkot• Kochi • Goa• Bhubaneshwar• Vishakapatnam
• Patna• Baroda• Varanasi• Nagpur
Most of the operation in 3rd tier cities
would be that of sub-contracting
Younger Population.
2/3rd CMM Level 5 organizations are
based in India.
Government Initiates.
Time Zone Difference.
NASSCOM Initiatives.
Will it all last till Eternity ?
When you offshore to India, you offshore to
world-class systems and quality.
Indian offshoring industry is at a growth
stage and the trend is expected to continue.
India’s unique set of attributes translate to a
sustainable position as an offshoring
destination which will last till ETERNITY.
Gaurav Kumar
Jugal Desai
Kshitij Arora
Niharika Goel
Rahul Mahajan
Rosy Walia
Sukhneet Wadhwa
Thank YouWe are now open to queries