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Announcement of immediate availability: Offshore Outsourcing Directory

If your company provides outsourcing software development or outsource testing services, feel free to list your information in the directory.   It’s free.  Hopefully, this will lead to business engagements for you and also allow site visitors to find service providers by country or technology.

If you have any feedback or suggestions for the directory, let me know.

Companies today contract their businesses or part of their businesses to other companies located in foreign countries. This business procedure is called offshore outsourcing. Offshore outsourcing has become a very feasible trend for companies that are expanding or just trying to reduce their overhead expenses.

Offshore software development is a kind of outsourcing in which the jobs of software development are transferred to offshore countries. Mainly companies in USA transfer software development job to India or other south Asian countries. In India there are many offshore development companies. In India offshore software development have some advantages and also some disadvantages.

Outsourcing is a one of the remarkable medium to let the services and technology move overseas without any hurdles to stop it. It is the outsourcing that can give wings to the creation as we can very well see that by the use of latest technologies and methods India today is serving a large amount of companies placed at various places in the world.

Outsourcing may be a way for a company to lay roots in a foreign country where they may be thinking of expanding. Hence, a company may outsource its business to a company in India in order to understand the prevailing Indian market and to adjudge the Indian customer. This may be a ploy to sooner or later open a branch in India. Huge conglomerates that are perpetually expanding opt for outsourcing as a survey method rather than as a method for garnering more business.

one advantage is that the portion of the business outsourced (which may be sales, telemarketing, research, etc.) no longer remains the concern of the outsourcing company. The offshore company hires its own experts and professionals. This creates a constructive division of labor that becomes fruitful to both the outsourcing company and the offshore company.

Like every coin has two sides the outsouscing too has its own disadvantage - One of the most prominent is the exposure of sensitive data to foreign countries. It may not just be the question of data – even secret organizational tactics and managerial strategies may be exposed that could prove to be detrimental to the parent company. There may also be dangers relating to restrictions and dissimilar legislations in the Offshore country that sometimes require changes in business policies. Outsourcing is also responsible for the distance it creates between the employer company and the employees. This deters the employers from building good rapport with their employees.

But none of us can deny the fact that it is the Outsourcing that can let us meet the unfulfilled requirements and needs of an individual or company whether that very technology is being used at ones place or not. India has proved as a number one destination for Outsourcing for more than 500 fortunate companies.

The big names corporate places like United States, Europe and Japan are looking towards India in respect of the cost effectiveness and high quality Software solutions available here. Studies confirm that vendors rate India as their number one choice for Outsourcing. It really feels proud to say that India is being looked at for providing state-of-the-art technology and timely deliveries. India holds nearly twice as many technical graduates as the US, resulting in the ability to give the best quality with timely submission.

Innovation remains the Technology industry’s most crucial competitive factor, yet most technology companies still lack effective processes to manage innovation investments that drive there success. It is seen that 80% of respondents say technology innovation is more important than ever to their companies’ success. 60 percent say their companies have a process to assess the strategic, financial and operational risks associated with innovation investments; however, only 47 percent grade their ability to manage these investments as above average.

74 percent of respondents say their company’s CFO and finance organization are now more involved in the innovation investment process; however, only 57 percent say the finance organization adds significant value to the process, and only 53 percent say the role of the CFO is clearly defined. Just 31 percent say that their companies use leading analytical tools to make and track innovation investments. Half of survey respondents are spending more than 10 percent of their revenue on research and development (R&D) spending. Respondents indicate about 30 percent of their innovation investments are ineffective.

It is hence expected that if the need of Outsourcing its benefits and innovation involved in it keeps on rising with the same pace outsourcing will soon be managed as an investment portfolio whereby cost is reduced, & risks are mitigated. The efficiency & performance of an IT department will be measured by the benefits that accrue out Outsourcing in a timely manner

Forrester Research, a research and consulting firm in its report says that, jobs that are getting lost in the United States due to software outsourcing are basically low salary IT jobs such as software programming or computer support specialists or computer operators. However, on the other hand, high paying jobs like system analysts, network analysts and research analysts are continuing dominating the market. In fact, jobs in this sector are growing at the steadily rate of 4 to 5% every year. Normally, these jobs require excellent domain knowledge and idea about the internal working of IT systems and business process. In software outsourcing these qualities are difficult to find.

Jobs that not get affected by software outsourcing

Higher skilled jobs such as system analysis and application development are increasing at the rate of 6% per year. That’s because, their demand is growing continuously. Also, software outsourcing can be shifted to India or other offshore software development countries, where buyers need in-house workforce to customize and upholder software.

Reasons for decrease in Software outsourcing in future

Are you the one afraid from this boom of software outsourcing? If yes, there is news which can lower down your fear for a great extent. According to a report, attraction of cost saving in software outsourcing is yet very high and because of that, increase in jobs like software programmer will be very less. That further results into very low increase in software programming jobs, salary rise will also hardly 1% in next few years. In fact, salary of computer operators and database administrators will also grow at the minimal rate of 1%. However, salaries of computer research scientists and information system managers will have highest growth at around 3.5% every year whereas salaries of analysts and system administrators will grow at the rate of 2 to 3% every year.

Offshore software development

It is also predicted that the market of software outsourcing which has major costs saving today will decrease by 2008. The main reason behind this will be the decreasing gap between the US salary and the outsourcing countries such as India. As, it will lower the salary in US, while in India and other offshore software development countries, because of lack of availability of resources, salary rise will be very high. It will also decrease the costs saving. Finally, companies will prefer their in-house resources rather then offshore outsourcing.

When you outsource software development, what kind of management software or process do you use?

I have tried many outsource marketplaces like oDesk, scriptlance, rentacoder, elance, etc.  Generally speaking, these applications have some kind of management and collaboration tools like - message boards, deadline dates, screen captures = time tracking verification, etc.  However, I find most of these tools cumbersome to use and end up transposing most of the project management items into my own internal management software and process.  This got me thinking…

I’m curious to hear how other people are managing outsource projects - big and small companies alike.  Do you have to choose from a preferred vendor list?  Is there a defined process for inclusion/exclusion for a preferred vendor list? Do you follow a service contract template?  How do you prepare and manage any Service Level Agreements (SLA)?  What is your request for proposal (RFP) process?  Do any of your answers from the previous questions include: Excel spreadsheet? 

Reasons for my questions and thoughts relate to an application I’ve been developing over the years - a collaboration platform called ServiceCycle.  Frankly speaking, a thing that has always bothered me about ServiceCycle is that is not focused on a particular industry or niche.  The industries that use ServiceCycle are all over the board. 

Perhaps ServiceCycle could fill a void in outsource management?  It could be customized to provide SLA management/enforcement, RFP distribution and monitoring, service contract templates, preferred vendor list organization and ratings, monitor and measurement of milestones, issue tracking, key dates, communication archiving and of course, tracking and reporting.

What do you think?  Would outsource management software be valuable to organizations?  Do you know of any products trying to fill this niche?