MUMBAI: Sourcing IT work from anywhere in the world at the best prevailing prices is now becoming mainstream for application-related services. Early adopters are actively exploring beyond application-related services, including business process outsourcing (BPO), call centers and infrastructure services, according to Gartner, Inc.

Gartner estimates that by 2004, all U.S. enterprises will consider global delivery sourcing as one of their top strategic sourcing options. More than 80 percent of U.S. executive boardrooms will have discussed offshore outsourcing, and more than 40 percent of U.S. enterprises will have completed some type of pilot, or will be sourcing IT services through a global delivery model, such as nearshore and offshore.

Providing a preview of the 'Opportunities for Indian IT Services providers' Track at the Gartner Summit 2003, July 16-17, Mumbai, Partha Iyengar, research vice president covering software and offshore sourcing in Gartner says, 'As the offshore providers increasingly compete with the incumbent global majors, and start to take business away from them, a competitive response by the global majors is giving rise to structural changes in the global services marketplace.' Mr. Iyengar adds, 'This will see the emergence of a new order of 'top-tier' Global IT service providers, some of whom will be the current global leaders and some will be from the ranks of the Tier 1 Indian service providers.'

'As enterprises evaluate the leveraging of offshore resources, understanding the associated risks and developing mitigators will be essential to the long-term success of the strategy,' adds Rita Terdiman, vice president & research director, offshore sourcing, Gartner.

By 2004, 70 per cent of enterprises will selectively outsource applications using a variety of application service providers (ASPs), traditional outsourcers, niche applications vendors and offshore providers. However, Gartner analysts said enterprises must use structured evaluation and selection criteria or risk engaging with the wrong ASP offering the wrong level of service.

'Risks exist in any project using ESPs, and enterprises must understand the differences between domestic and offshore sourcing and use risk assessment framework to understand the risks of each stage of an offshore relationship,' concludes Ms. Terdiman.