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The new entrepreneurs The world got to see India’s talents when the Y2K bug came calling. Thanks
to our education system, we got a chance to rewrite code—in time and
under-budget. Since then, we have been moving up the value chain, mixing
technology applications with business solutions.
Consider neo-IT, an outsourcing exchange founded in June 1999 by Indians. It
provides an e-business technology platform for the sourcing, procurement,
management and delivery of IT services to Global 2000 companies. neo-IT’s
software and services introduce an IT services procurement and supply chain
methodology, and reduce an enterprise’s total outsourcing costs by 20-60%.
neoIT witnessed a 150% increase in business last quarter and expects to sign
major multi-million dollar outsourcing contracts this quarter. According to its
managing director Avinash Vashistha, "There is a substantial increase in
the interest to outsource must-do IT work, as is evident from our strong order
book position. Providers of such services, especially who can demonstrate their
ability to execute projects with quality and punctuality, will benefit
greatly."
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Where Is the Market
Headed? |
- IBM, EDS and CSC are the Big Three of global
outsourcing, and they are increasing their footprint in India
|
- The increase in offshore outsourcing will
see profits increase for most Indian companies, even as revenues
decrease
|
- Outsourcing contracts are mostly coming from
applications maintenance, B2B infrastructure, wireless and broadband
networks, CRM solutions, call and contact centers and enterprise
systems integration
|
- Vertical markets on a roll are
manufacturing, telecommunication service providers, retail,
insurance and technology
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- The market for IT consulting, development,
integration and outsourcing will increase from $696 billion in 2000
to $1.3 trillion in 2004
|
Dataquest (USA) estimates that Global 2000 companies currently spend over
$75,000 per project in the RFP process and up to six months’ sourcing and
selection of an external service provider for each IT services project. The
Gartner Group estimates that the worldwide market for IT consulting,
development, integration and outsourcing will increase from $696 billion in 2000
to $1.3 trillion in 2004. While 60% of Fortune 1000 companies indicated that
they would be outsourcing more than half their IT services by 2004, 80% have no
formal process in place for procuring those services, according to Gartner.
Indian service providers with a core experience should augment their offering
and presentation to demonstrate their ability to execute the job as per global
standards of quality and delivery. There is a lot of business out there. Focus
needs to be on offshore development and a long-term plan to move up the value
chain of the customer’s business. From application maintenance to systems
integration, to consulting to end-to-end outsourcing…the list is long, and
growing.
Ishan Ranjan is VP, projects, CMIL. He
can be reached at . Previous columns can be read at dqindia.com
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