Outsourcing to India: Coding - Out, R&D - In
This has led to a new breed of service providing manpower being
spawned in India, one with complex degrees and sophisticated
skill-sets ready to take on high-end product development,
Research & Development (R&D), IT services, both for overseas and
domestic companies. Likewise, job profiles in the business
process outsourcing (BPO) sector are undergoing considerable
changes. New recruits to the industry continue to be fresh
graduate, but professionals with degrees like M.Tech, CA, MBA,
ICWA, etc. are showing a keenness to work in domain-specific
back-office fields like advisory, analytical and consulting
areas.
According to Kiran Karnik, President NASSCOM: "While India's IT
prowess is unquestionable, the success was based on a strategy
focused on the country's competitive advantage. First and
foremost, because of the English language skills of its
population, India has a competitive advantage over other foreign
suppliers providing IT services on an outsourcing basis to the
US market and other major English speaking markets."
Today, the excellent language skills of the Indian workforce are
complemented by high levels of education, as it is 55% or half
of all Indians working in California's high-tech IT industry
have a MS or Ph.D. degree to their name. On the home turf, 81%
of software professionals have a graduate or post-graduate
degree, 17% with M.Techs, MBAs, ICWAs, CAs, 69% with B.Techs,
BEs, MCAs, and 14% are graduates or diploma holders.
With access to a talented labour pool with necessary IT skills
for software development and to provide IT services for overseas
markets, Indian IT companies have worked at broadening skill
sets to perform complex work. Their hardwork and training has
accomplished brilliant results as the complexity of work being
off-shored / outsourced increases with each passing day. NASSCOM
reports a tech-ready, tech-trainable work force in excess of
750,000. From 2000 to 2004, employment in the IT and ITeS
industries grew 30.1%, tripling and touching the 1-million mark
by end-2005.
India, annually graduates 250,000 students with engineering
degrees and 500,000 with non-engineering, all geared to take up
employment in the IT and IT-related sectors. But, the number of
students graduating with engineering / technical degrees has
increased due to higher income levels in jobs in the field and
an increasing number of technical institutions starting up to
take up the challenge of providing enough educated, talented and
skilled workforce for India's every increasing slice of the
off-shoring / outsourcing pie.
NASSCOM statistics confirm that despite China's entry into the
off-shoring / outsource service providing market, India has an
advantage over China and other competing countries. Much to its
disadvantage, China does not graduate enough qualified,
technical engineers, only 50,000 engineers graduate with the
necessary skills for global employment, whereas Indian schools
churn out 290,000 per year.
While, India employed 284,000 IT / ITes / BPO professionals in
1999-2000, that number has grown to 1-million in 2004-2005, and
growing by 150,000 in the last year alone. While ITeS / BPO
employees saw the highest growth levels over the last few years
due to the tremendous demand for Indian service providers by
multinationals off-shoring / outsourcing, 94,000 professionals
will take up employment in the ITeS / BPO sector, but in the
same period, 109,000 IT professionals will be taken on board by
IT services and software companies.
Already, India ranks as the world's leading off-shoring /
outsourcing destination for IT and BPO, and will sustain its
leading position. With IT / ITeS / BPO providing services from
off-shore destinations projected to grow by 24% to $94-billion
by 2008, India is set to grow by 31% to $48-billion, 51% of the
global total by 2008. Last year alone, the ITeS / BPO sector in
India hired an estimated 400-employees for each working day of
the year.
The demand for Indian skilled domain specialists, software
analysts, integration specialists, information security,
database administrators, communication engineers, network
specialists, data warehousing and semi-conductor design
continues to grow apace, as Indian professionals make their mark
in the IT and IT service related field.
To conclude, a quote by NASSCOM President, Mr Karnik: "While the
offshore phenomenon may have started on cost, Indian IT service
vendors have proved that cost competitiveness is not the only
advantage they have to offer. Today, Indian companies are
recognised as much for their high degree of quality orientation."
Quality and cost are the reasons that India has become and will
continue to remain the favourite off-shoring / outsourcing
destination of the world. And, from low-end work, it has
graduated to research and development for IT majors such as
Microsoft, Intel, Cisco Systems and many others. It is not going
to be easy to dislodge India from its coveted position of the
Number One off-shore/ outsourcing service provider!
About the author:
manjot kamal workins in a1 technology as SEO analyst