Thursday, March 18, 2004

Competition Leads to Higher-Value Outsourced

The rise of outsourcing has led to increased competition among service providers in India, which not only have to compete among themselves but with counterparts from other countries now slowly catching up.

Competition, however, has spurred Indian companies to assess their current capabilities and develop or acquire further skills that will lead to higher value work.

According to a comment posted in an industry opinion portal, wages from software development work in India has gone down to about $10-$20 per hour from $50-$70 per hour three years ago. Blame it on the number of service providers which has mushroomed over the past several years.

In an effort to stand out, some companies have evolved from software encoding to being large-scale solution providers like maintaining software applications remotely for a client (under what is generally called BPO) or remote maintenance hardware systems.

Because of mission-critical systems that run 24 x 7, companies in the US for example are tapping IT guys from India to do the task for them at salaries more than half of their American counterparts. Clients don't even have to pay night differential since work is done halfway around the globe.

While CEOs sleep soundly at night, the guys in India make sure that the systems that power corporate America are up and running.