Wednesday, May 14, 2008

Reverse Outsourcing: India getting a piece

I figured it's going to happen sooner or later. Outsourcing now becomes everyone’s playing field. The whole outsourcing process has been looked down with disdain mainly because the act was one-way. The definition practically amounted to "Americans giving jobs to other countries while taking away jobs from their own citizens" However, now that India is starting to see the benefits of outsourcing to their own companies, they decide to take part in it too. The process of information technology outsourcing takes a full turn now.

Which is good don't you think? The big companies comprising India are now looking into outsourcing possibilities to reduce the workload in-house and focus on their core functions. The top functions that are outsourced are information technology and customer relation management. With these out of the way, their headaches are now more focused on things that have a great impact to their operations.

More and more Indian companies are setting up offices in the United States. Indias Wipro Technologies Ltd., a global IT services and outsourcing provider, plans to open a global software development center in Atlanta, adding 500 new jobs to the economy. Wipro also opened a service center in Detroit earlier this year.

How about cost? The decision to reverse outsource is the same as the reason why outsourcing is a hype in the US companies. India wants to cut back on cost and at the same time make their company global. The rupee currently valuing 40 to a dollar, makes Indian wages higher and setting up businesses in the United States relatively cheaper. At least by theory. This is still a new concept for India but they are hopeful and it seemed like the future is bright for this venture.

With the cycle of US companies giving jobs to India and India returning jobs to the US, will we be able to see improvement in both economies? Will Yin finally balance Yang? We don't know that yet. But even if reverse information technology outsourcing doesn't work for India when it comes to cost, they are still persistent to set up global companies. So I guess we don't have to worry about anything. Not yet at least.

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