Pressure on outsourcing

Source: Rediffnews
By James Fontanella-Khan
India's celebrated IT outsourcing industry, which contributes about 25 per cent of the country's total exports, is feeling the pinch as it struggles to deal with the avalanche effects of the global financial crisis.

The National Association of Software Services Companies (Nasscom), India's software services lobby, this week added to the gloom by downgrading the sector's export revenue growth to 17 per cent from 21 per cent for the year ending March 2009, as demand from developed markets fell.

IT executives are trying to talk down the revised growth outlook, as they argue that their companies are still outperforming other industries in India. However, this did not stop Ganesh Natarajan, the chairman of the Nasscom, from asking the government for help to stimulate growth "by extending fiscal incentives to this industry".

Mr Natarajan's demand for state aid suggests there could be more bad news in the pipeline for an industry whose corporate integrity has been questioned after revelations of an alleged $1bn fraud at Satyam Computer Services [Get Quote].

Several IT services analysts believe that a 10 per cent growth rate for the sector is a more realistic figure, as demand from the US, which accounts for more than 60 per cent of the industry's export revenue, is not going to pick up until late 2009. Industry leaders, such as Infosys [Get Quote] and Tata Consultancy Services [Get Quote], will have to be creative to outperform their expectation.

Worries grow about Obama's outsourcing policies

Source:Rediff News

By Mehul Srivastava

After a decade of outsourcing helped transform India into much of the world's back office, Indians are worried that President Obama's new Administration - and the slowdown in the global economy - will cast a shadow over one of the fastest-growing sectors of their economy.

Obama's $787 billion stimulus plan will make it increasingly difficult for US companies receiving bailout money to hire foreigners on temporary work permits known as H-1B visas. The budget the President recently presented may also make it harder for US companies that send jobs overseas to receive tax benefits.

In India, where the $63 billion IT sector makes up almost 7 per cent of the national GDP, the moves are worrying government officials. Acting Finance Minister Pranab Mukherjee groused about it over the weekend in an interview with CNN-IBN, a content partnership with Time Warner's CNN owned by India's TV18. "We will have to address this issue," said Mukherjee, whose ministry has spent the last five months trying to restart India's slowing economy with tax cuts and spending plans. "We are opposing protectionism, not only here but at every forum."

India needs a lot more love from Obama

Source: Shadow Foreign Policy

By Dan Twining

In 1998, President Clinton flew over Japan without stopping to spend nine days in China. This led to acute concern in Tokyo over "Japan passing" -- the belief that Washington was neglecting a key Asian ally in favor of the region's rising star, China. Is the same thing happening today -- not with Japan, destination of Secretary of State Hillary Clinton's first overseas trip, but with India?

The construction of a strategic partnership with India was arguably President Bush's signal foreign policy accomplishment. Decades of estrangement between the world's largest democracies gave way to a strategic breakthrough akin to President Nixon's visit to China in 1972. Senior Bush administration officials believed that India could emerge as America's most important international partner over coming decades, given India's growing capabilities and a congruence of interests in defeating global terrorism, managing China's rise, sustaining an open global economy, and securing our common values.

For its part, the government of Manmohan Singh literally put its survival on the line for the United States, subjecting itself to a confidence vote in parliament in order to move forward with the civil nuclear cooperation agreement. Few other countries -- including America's closest allies -- have passed such a test.

But signs of trouble in U.S.-India relations emerged early on Barack Obama's road to the White House. As a Senator, he offered a killer amendment to restrict nuclear fuel supply to India during consideration of the civilian-nuclear agreement, which the Bush administration and India's supporters in Congress had to work hard to defeat.

During the presidential campaign, he revealed that he had asked Bill Clinton to consider serving as a special envoy for Kashmir in an Obama administration, alarming Indians in the way that Americans might be alarmed if the European Union offered to send a senior envoy to mediate between Mexico and the United States over the status of Texas.

Candidate Obama also pledged, if elected, to push for U.S. ratification and global entry into force of the Comprehensive Test Ban Treaty. This issue, more than any other, divided the United States and India in the 1990s, especially when the United States and China -- which had helped sponsor Pakistan's nuclear and missile programs targeting India -- ganged up on India at the United Nations to press it to accept the test ban.

India frets over Obama's Chinamania

Source:Asia Times
By M K Bhadrakumar

Chinese Foreign Minister Yang Jiechen's visit to Washington this week is notable for three reasons. One, Yang is paying a return visit in a little over a fortnight of US Secretary of State Hillary Clinton's visit to Beijing. The intensity of the US-China traffic is indeed extraordinary by diplomatic norms. China seems to have blithely overtaken the traditional allies of the US, such as Germany and Japan.

Two, Yang's visit coincides with the 50th anniversary of the uprising in Tibet. Washington doesn't seem to be bothered at the coincidence. It is actually underscoring its current priorities in the US's relations with China. Tibet is an issue that arouses some animated passion in certain American circles. The US Congress and State Department have paid heed to these public sentiments



while Beijing on its part has duly regretted the US statements, but both sides are confident that life must move on.

Clinton made it clear during her Asian tour last month that neither Tibet nor Taiwan can be allowed to impede the serious business of Sino-US relations in the current world scenario characterized by the economic crisis.

Three, Yang's visit has been envisaged as a significant input in the run-up to the Group of 20 (G-20) summit meeting on April 2 in London. True, the US is widely consulting other countries for opinions on solving the economic crisis. But, again, the criticality of Chinese input for the US is self-evident from the fact that Yang has a scheduled meeting with US President Barack Obama.

But viewed from New Delhi
, Yang's visit assumes an entirely different color. The intensity of US-China traffic is in sharp contrast with the virtual absence of high-level political exchanges between the Indian leadership and Obama. So much so that the former director for South Asia in the National Security Council in the George W Bush administration, Xenia Dormandy, penned an article on Wednesday in The Christian Science Monitor precisely focusing attention on the subject.

Dormandy played a key role in coordinating the July 2005 landmark visit of Indian Prime Minister Manmohan Singh to the US that led to the new US-India strategic relationship. Titled somewhat exaggeratedly - "India: America's indispensable ally" - her article made an impassioned plea that "Obama's team would be wise not to forget it [India]". Dormandy pointed out that in foreign policy, "[The] Obama administration has started with a full sprint. Between the financial crisis and events in Afghanistan, Iran and Russia, and elsewhere, it's had to. But in rushing ahead to confront one crisis after another, it risks forgetting a crucial friend: India."

India's first contact with the Obama administration has been in the nature of Foreign Office consultations, when the Indian foreign secretary visited Washington this week. Reading between the lines, the picture that emerges from the reports of the consultations in Washington is that the US-India relationship is entering a phase of lull..........


Ambassador M K Bhadrakumar was a career diplomat in the Indian Foreign Service. His assignments included the Soviet Union, South Korea, Sri Lanka, Germany, Afghanistan, Pakistan, Uzbekistan, Kuwait and Turkey.

(Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

Outsource Software Development Using Rentacoder

Source: Articlesbase
The existence of the Internet and the facilities that this industry offers us has forever changed the way the world handles its affairs and ultimately has forever modified the way most companies conduct their businesses. Due to the Internet, companies can now have the choice of hiring people from all over the world to do some specific work that they cannot handle. This reduces costs for the company and assures it at the same time that the job will be done properly.

Due to drastic change that human resources has thereby suffered, becoming more fluid, a place where outsource software development was accessible to all people was necessary. To our delight, most people and companies nowadays solve problems that we did not even know we had. Outsource software development using rentacoder is the fastest solution companies today have. It reduces costs significantly; it assures the company that the best people on the job will satisfy their software development needs and, most importantly, the services are easy to locate due to a specialized site, rentacoder, which has a big network of businesses.

Outsource software development using rentacoder is the easiest and most convenient way that companies have these days. The times when companies had to invest a lot of time and money into training people to resolve software development problems is long gone. Nowadays, outsource software development using rentacoder is the golden solution that companies just have at the tip of their fingers. Freelance professionals from all over the world are more than ready to bid on your projects, saving you a lot of time and more importantly a lot of money, for prices can always be kept down as long as it is in both parties’ interest. Outsource software development using rentacoder is probably the most cheap and efficient method that a company can choose and when the results are more than pleasing, I believe it is the best choice that a company can make.

Because outsource software development using rentacoder involves people of different nationalities, who speak different languages, there is the possibility of problems arising because of the lack of proper and accurate communication. Rentacoder arbitration is the solution for these problems. Arbitration is the determination of a dispute by a referee, an impartial one that both parties agreed on. Whenever problems appear due to different factors, rentacoder arbitration is the solution that is offered to you. It is very important to know this aspect and to agree with it, because it is one of the terms you have to say yes to when deciding that the best solution for your company is outsource software development using rentacoder.

All in all, in a world where problems are often without solutions and you can find everything you desire only one click away, the best solution that a company can opt for in order to achieve its goals is to choose outsource software development using rentacoder. Not only time and money will be saved, but you will realize that you have made the right choice once the results start showing. Moreover, if ever a dispute shall arise, rentacoder arbitration is the solution offered by the party involved, a solution that can only be in the best interest of all people involved.

For more resources about Outsource software development using rentacoder or even about rentacoder arbitration please review http://outsource.supergloo.com

Why China for Outsourcing?

Source: Offshore-development.co.uk
By Betty Zhang
Why China for Outsourcing?

– Large Scale (presenting splendid opportunities for the potential, large domestic markets)
– New emphasis on Education System
– Aggressive plans to broaden English-speaking capabilities
– Up-to-date and growing Infrastructure
– Liberalization of laws, policies and the Government Incentives
– Burgeoning middle class
– Opportunity to be a fast follower by learning from the Indian and other leading countries` experiences, avoiding their mistakes and accelerating progress
– WTO Entry and Oversight
– Large multi-nationals already manufacture in China

Why Chinese Outsourcing Companies?– Diversifying away from existing regions in the world

– Lack of resources and/or high turn over in other countries
– CMM certifications now in process within certain Chinese companies
– Improved corporate governance, risk management and compliance
– Talent pool needed for large projects
– Favorable business environment


Finally, the reality is that the Chinese outsourcing services industry has its challenges, but is also has the devoted interest of a very goal-oriented government that has made one of the fastest growing economies in the world. Blend in China’s many other assets and reality looks quite promising.--from neoIT research of “The China Reality Check” in June 2005.

Author: Betty Zhang from www.shanghai-digital.com
E-mail: nzhang@shanghai-digital.com

Indian’s biggest body shopper stops hiring

Source: India Daily
By Satish Rai
They are in India. They are abroad. They make millions of Rupees in salary and benefits. They live luxurious life. They abused their Engineering degrees in becoming cyber slaves of the West. They fix the legacy software that no European or American like to do. Yes, these are 100 million Indian cyber slaves that are paid for their hourly work, occasionally through middlemen called Indian or western body shoppers.

India’s biggest (mother of all) body shopper is shaking top to bottom as revenue vanish and the trader owner is little interested in supporting the bad trades. Tata Consultancy Services (TCS) has plans to freeze its lateral hiring. According to sources, unless US and the rest of the world economies get out of depression in the later part of this year, TCS will stop all hiring and lay off 25% of its work force.

For body shoppers, it is a downward snowball. They have extensive contracts with western companies that they must honor. At the same time, they have to cut cost because of rapidly diminishing revenue and mounting bad debts. Their services will deteriorate, making revenue further fall. They will lay off more people. The cycle will go on till their owners understand in then next five years, it is a worthless business models and wrap up the company.

Outsourcing

Source: Economist.com
By Tim Hindle
Outsourcing is a term used to describe almost any corporate activity that is managed by an outside vendor, from the running of the company’s cafeteria to the provision of courier services. It is most commonly used, however, to apply to the transfer of the management of an organisation’s computer facilities to an outside agent. This transfer of management responsibility is frequently accompanied by a transfer (from the buyer of the outsourcing service to the vendor) of the specialist internal staff who are already carrying out that activity.

Outsourcing has three main advantages:

• The greater economies of scale that can be gained by a third party that is able to pool the activity of a large number of firms. It is thus frequently cheaper for a firm to outsource specialist activities (where it cannot hope to gain economies of scale on its own) than it is to carry them out itself. Some firms gain the economies of scale by taking on the activity of others, becoming an outsourcer themselves.

• The ability of a specialist outsourcing firm to keep abreast of the latest developments in its field. This has been a particularly significant factor in the area of information technology, where technological change has been so rapid that companies’ in-house capabilities are hard pressed to keep up with it.

• The way that it enables small firms to do things for which they could not justify hiring full-time employees.

The most commonly cited disadvantage of outsourcing is the loss of control involved in derogating responsibility for particular processes to others.

Outsourcing is not a new phenomenon. Companies have outsourced their advertising, for instance, for almost as long as advertising has been in existence (and J. Walter Thompson has been in business since the 1880s). Financial services such as factoring and leasing, the outsourcing respectively of the accounts receivable function and of capital funding, have also been available from outside providers for many years.

But it has grown exceptionally fast in recent years. According to one estimate, in 1946 only 20% of a typical American manufacturing company’s value-added in production and operations came from outside sources; 50 years later the proportion had tripled to 60%.
Much of the increase came from the outsourcing of IT functions. This was bolstered later by the outsourcing of other functions (such as logistics) that were in areas that themselves had a high degree of it content. Banks, for instance, began to outsource the IT-intensive processing of financial instruments such as loans or mortgage-backed securities. The savings from such moves could be dramatic. By deciding to outsource the origination, packaging and servicing of all its personal loans, both old and new, one British bank cut the average cost of processing by over 75%. In the car industry in the 1990s, firms with the biggest profit per car, such as Toyota, Honda and Chrysler, were also the biggest outsourcers (sourcing around 70% to various suppliers). Those that outsourced the least (General Motors, for example, which outsourced only 30% of its value-added) were the least profitable.

The nature of outsourcing contracts has changed over time. What started off as a straightforward arm’s-length agreement between a buyer and a supplier moved on to become structured more like a partnership agreement. In this, not only is any increase in the clients’ volume of business reflected in the outsourcer’s scale of charges, but both parties in some way share the risks and rewards of the outsourced activity.

Relationships like this vary over time and require firms to learn how to work together in entirely new ways. In the early 1990s, in a groundbreaking five-year outsourcing agreement with BP, Accenture (then called Andersen Consulting) took over responsibility for running the day-to-day operation of BP’s accounting systems. BP retained control of accounting policy and the interpretation of data for business decision-making. In return, Accenture guaranteed BP that it would reduce the cost of running the service by 20%.

Some firms have been so taken with the idea of outsourcing that they have left themselves with little to do. An American company called Monorail Computers outsourced the manufacture of its computers as well as the ordering, delivery and the accounts receivable. Only the design was left to be handled in-house.