Software Outsourcing: A Western Dilemma or an Opportunity ?
06/15/2010

According to the study, only four countries - India, Ireland, Canada and Israel - are capable of scaling up to meet the demands of large-scale projects in offshore software development.

Online PR News – 15-June-2010 – – Unlike business process outsourcing (BPO) and information technology outsourcing (ITO), which are mature business models, the software outsourcing and offshore outsourcing business is relatively new. According to a Gartner study, the most successful hub for offshore software and software development outsourcing is India. Globally, according to the study, the Tier I Cities for software outsourcing are: Bangalore, Yerevan, Mumbai, Ahmedabad, Bucharest, New Delhi, Hyderabad, Chennai, Pune, Indore, NOIDA, Gurgaon, and Thiruvananthapuram.

The Western Dilemma: The global economic crisis has deeply affected especially Western countries and it is estimated that they will take a minimum of five years to recover. While they have tried to retain their advantage in technology, there are problems:

• The USA and Canada producing a little over half the required number of graduates in science and technology

• A large number of their MS and PhD students are international students who are likely to return to their countries

• Mostly, the Western countries have aging populations, and executives in senior positions are heading towards retirement

• While these countries are recovering, they are still lagging in the kind of growth and business competitiveness that they had in pre-economic crises days. The productivity gap between them and smaller industrialized nations continues to widen, every day.

The Software Outsourcing Solution: The solutions to the human resource problems faced by startups, emerging and established technology companies and IT enabled organizations in the West are not possible in the short term - even immigration is a long and difficult process. This makes offshore software and software development outsourcing a viable solution for Western countries.

• Some benefits of offshore outsourcing for software and software development are:

• Cost effective, especially in tough economic times

• Timely maintenance and service

• Internationally qualified specialists in software and software development

• Offshoring and outsourcing leaves clients free to focus on their core businesses, which could be manufacturing, hospitality, sales, etc.

• Scalability

Offshore outsourcing for software and software development has gained acceptance in most Western countries and is already a US$65 billion industry, predicted to grow rapidly and contribute to effectiveness, productivity and competitiveness to organizations around the world.

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