Real Reasons behind India's Success in Offshore Outsourcing

Innumerable articles have been written and are being written on the success attained by Indian firms in IT outsourcing. Whether it is Business Process Outsourcing (BPO), Knowledge Process Outsourcing (KPO), Legal Process Outsourcing (LPO), medical transcription or web designing and development, India’s leadership is unquestionable. Talking of offshore outsourcing to India and the success achieved by Indian firms in this area, the discussion is usually directed towards the cost-efficient services coupled with competence and skills shown by India’s educated workforce. These are but apparent reasons. Clients are, after all, businesspersons. They would demand the price for every penny spent. Had the Indian service providers not been proficient and affordable, the clients would think twice before handing their projects, often with sensitive data, to Indian tech firms. So, what are the real reasons behind India’s success in offshore outsourcing , despite the low per-capita computer and internet usage compared to many smaller countries in Asia? Let us analyze some of the behind the scene reasons.

Post-liberalization factors: in the early 1990s, India suddenly overhauled its stifling socialist system and opened the gates for business and industry to free-market economy. This included priority to information and communication technology. This coincided with the rise of the Internet and explosion of the World Wide Web and provided the perfect timing and setting. Indian hi-tech service firms took the opportunity to invest and thrive in the liberalized environment.

Educated workforce: despite poor showing by India as far as primary education is concerned, there is an inexhaustible, young and employable workforce, most of them just out of the colleges, ready to learn computers and develop skills to find jobs in the outsourcing industry. For many job seekers, the immediate motivation may be the societal pressure of contributing to the family kitty. It is another matter that the larger interest of developing their career by getting higher education is ignored.

Affinity with the languages: the lingua franca of the communication and the Web is English. India has a huge pool of people that can understand, speak and write in workable English of near-native fluency, if not of high standard. Where this affinity comes from and why other outsourcing destinations like China and the Philippines lack in this area? The answer is that Indic languages are part of the Indo-European group of languages and share many common characteristics with western European languages. This gives the average educated Indian a natural affinity to learn English and other languages of the Indo-European group.


Source by wardsmith

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