India, undisputed offshore leader: Gartner

NEW DELHI: India remains the undisputed offshore leader, with China and Russia continuing to emerge as strong contenders and many other countries eyeing the potential of providing offshore IT services.

According to Gartner, the 10 new countries joining the European Union on May 1 will not challenge India or China in terms of size and number of IT professionals. However, these countries do have a part to play in Europe for nearshore outsourcing; they have distance, time zone, cultural and language connections in their favor. Hungary, the Czech Republic and Poland, for example, are likely to attract increasing attention from German companies.

Gartner presented its analysis of outsourcing trends and a wide range of other current IT issues at its Spring Symposium/ITxpo in Barcelona, Spain. According to Gartner, the outsourcing segment will continue to outperform the western European IT services market overall, growing by 3.1 percent in 2004, then rising steadily during the next three years to an annual increase of 8 percent in 2007.

Moreover, as a result of global outsourcing trends, Gartner predicted that up to 25 percent of traditional IT jobs in many developed countries today will be situated in emerging markets by 2010.

According to Gartner, increased activity in offshore outsourcing is one of the most significant shifts in IT in the near-term. By 2005, 30 percent of leading European businesses will include near-shore or offshore in their business and IT plans.

However, while global sourcing enables companies to deliver higher levels of services at less cost, it also poses challenges and risks. Gartner said that we would continue to see increasing backlash in connection with white-collar jobs moving offshore.

According to Gartner, organizations will also need to invest in new skills to make outsourcing work and that additional jobs will be created as a result of global sourcing. It said that governments and corporations both have a vital role to play in helping their citizens make this transition as quickly and painlessly as possible through education and retraining.

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