Source: Times of India

According to ‘India’s Knowledge Process Outsourcing Sector: Origin, Current State, and Future Direction’, Alok Aggarwal, Chairman of Evalueserve and author of the yet to be released report, predicts the Knowledge Process Outsourcing (KPO) industry, the most promising of all outsourcing sectors is poised for celebratory times ahead, adding KPO will be worth $16.7-billion by 2010-11.

With an annual growth rate of 39%, the next four years will see it grow faster than even the BPO sector, globally. And, while 106,000-professionals worldwide worked for the KPO sector in 2006-07, the report predicts those numbers will touch 350,000 by 2010-11.

That’ll put to rest all those Cassandra tales of Chinas, Vietnams, Philippines, Russias cutting into India’s share of the global outsourcing pie. Facts and figure tell a different story, as they give the real good news i.e. while, India will be the future hub of the KPO sector, its competitors and outsourcing success story wannabes i.e. China, Philippines, Russia , the spokes in the KPO industry wheel.

“There is a substantial momentum in the growth of KPO industry in India, and though the attrition rate is high, there are still enough new graduates that are joining this industry to keep this momentum going,” says Aggarwal.

IN 2006 – 07, the KPO industry saw its earnings shoot up from $1.2-billion of 2003-04 to $4.4-billion, an annual growth of 54% worldwide. Similarly, its employee headcount grew from 34,000 in 2003-4 to 106,000 in 2006-07.

In comparison, BPO revenues moved from $7.7-billion in 2003-04 to $15.8-billion in 2006-07, an annual growth rate of 27%. And, the next four years should see the BPO sector experience a 26% annual growth rate, generating $39.8-billion.

As for India, the KPO industry employed had 9,000-professionals on its rolls in 2000-01. By 2006-07, their numbers scaled up to 75,400 and generated $3.05-billion in profits.

Aggarwal claims, issues like attrition, health in the call-centre industry helped trigger off a growth in India’s fledgling KPO industry.

The fact is, growth of the KPO industry can also be significantly hindered by attrition, with a drop in projected revenues of $11.2-billion in 2010-11 to $9.9-billion, or lower if attrition is not controlled. As for India’s outsourcing competitors, Aggarwal believes, probably the Philippines closely followed by China could pose a challenge, however, not a serious one, as KPO most likely driven by factors like breadth and depth of coverage, domain expertise, location advantage, sales and marketing capabilities etc., will allow India to retain its position as the world’s KPO hub, in large part due to its head start at all requisite levels

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Therefore, it is quite likely that firms with their own captive centres, as well as, those utilising third party vendors, may use a ‘hub and spoke’ model, where a provider in India may constitute ‘centre’, whereas other units in the world may provide appropriate ‘spokes.’

So, no matter all the doom and gloom of India losing its competitive edge to China, Philippines et al, is simply meant to throw the Indian outsourcing industry out of kilter. It is, but a ruse, a ploy to erode the confidence of a nation coming into its own after many years of western dominance and suppression. The trick is, in order to beat it at its own game, the East should take with a pinch of salt everything that the West says. India should take into account all the weak links western studies point out in our outsourcing chain, strengthen the chinks in our armour, and refusing to let them dent our confidence, prove them wrong. India is well on the way to becoming the KPO outsourcing hub of the world, all thanks to its formidably lethal cocktail of youth, education, skills and knowledge that has even Destiny on its side! Cock a snook, thumb your nose, and show the V for victory sign every time someone in the West tries to undermine India’s success! Loads of attitude and daredevil confidence, of course, coupled with our lethal cocktail, will ensure India is the winner, every time!

Source: www.indiaabroad.com

To provide 24 x 7 support for creative functions across the globe, India’s creative reputation stands at a critical point.

Pratap Bose, CEO - Ogilvy & Mather India affirms, saying: “Our core strength is that we communicate in English, are low-cost and have impressive skills in design and creatives.”

When just about every conceivable field is being outsourced, it makes little or no sense for advertising to be left behind. And surely, India has what it takes to become Asia-Pacific’s, even the world’s outsourcing hub. But, as things stand, it could take five to ten years, before India’s imaginative and highly creative skills are noticed.

However, we have to work today to ensure it is a future reality. Giant strides are required, not the baby steps of the Indian advertising industry. What is India scared off? That the West will laugh at it! Stuff and nonsense! Simply laugh back at them, if they jeer, well just stuff their faces! Hasn’t history proved, the West was never superior to the East. The myth was perpetuated through guile and cunning, by playing on Eastern naivety, fooling it into believing West was best. No need to let those thugs and rogues from the West get away with the same trick twice. With attitude and loads of chutzpah, we can ensure India becomes the outsourcing base for global advertising.

Compared to the rest of the world, the Asia-Pacific region records the highest growth in advertising, and India plays a vital role in the region. Already, a regional hub for certain clients and brands, Made in India gaming, animation, design outsourcing, production and research is exported worldwide from the sub-continent. Certainly, it is a regional hub in particular fields; however, it cannot call itself a truly global advertising hub, in any sense.

Still, Indian advertising firms, such as, Ogilvy & Mather and Lintas have begun to open 24 x 7 studios that provide support to creative functions across their global networks. And already, Ogilvy’s Bangalore office is a global hub for Lenovo.

As for Nokia - cell phone manufacturer, recently it selected worldwide agency - Wieden and Kennedy to take care of its global creative work by adapting it to local market conditions. India could well do the same thing! You think impossible! I think not! Case in point, our very own advertising agency – JWT that designs advertising campaigns from a single location, which Unilever runs in several markets.

The Indian advertising sector’s core strength is that it communicates in English, India is a low-cost destination, has an impressive pool of talent, coupled with great design, research and creative skills. So much so, when the outsourcing industry talks about off-shoring to China, they are constantly challenged and hard pushed to find a tough to beat package India offers. The sub-continent’s incredible talent pool, certainly works to its advantage in handling global clients.

As well, India has expertise and knowledge in understanding low-income group consumers, a major communication advantage with developing markets across the globe e.g. in countries like Africa and even those of Eastern Europe, who have only recently broken free of their communist regime. India has the wherewithal to understand the pulse of consumer markets in these countries, which is another valuable bargaining chip in helping global clients sell their products. Excellent communication skills stand India in good stead, when addressing consumers in Africa or other parts of Asia.

The recently held GOAFEST saw Indian advertising industry experts speak about India’s growing status in the field of advertising. To increase advertising’s 0.55% contribution to 1% of the country’s GDP, outsourcing will be the greatest facilitator.

Just proving its mettle in handling a small clutch of global clients, will instil confidence in the international market that India is capable outsourcing destination.

Arvind Sharma, Chairman (Indian sub-continent), Leo Burnett says: “India’s creative reputation is not formidable enough - Indian agencies still haven’t won a TV gold at Cannes.”

Undoubtedly, India is the world’s hottest outsourcing destinations, and with good reason, too. It has a huge pool of immensely talented people, with the right education, dedication and sufficient if not excellent command over the English language, making it an excellent outsourcing hub for any regular function.

But then, neither is advertising a regular function, nor is it an exact science, where the right training or having a right degree guarantees right output. Therefore, a part of the challenge Indian advertising faces, before it can emerge as a serious contender in the outsourcing game, is building credibility amongst global clients. And, before it can get anywhere, certain key issues need to be resolved i.e.:

Over 2-million people responded, helping the city register a 10% drop in energy used that night! It is ideas, such as these that represent not just an agency, but the advertising industry, as well. Unfortunately, Indian advertising remains centred around commercials for TV. This has to change, if India wants to become a global advertising outsourcing hub.

In a creative profession like advertising where people make all the difference, agencies must be managed more efficiently, so that adequate compensation helps retain talent.

All said and done, India can and will become international advertising’s favourite outsourcing hub. The day is not far off, when global clients will swear by Indian creativity, but, for it to come, India has much to do. To begin with, it has to snatch a gold year after year, and ten years from now, as for the IT industry so too for advertising, India will be the world’s favourite outsourcing hub! Amen to that!

Source:www.dailyindia.com

India’s second largest software exporter, Infosys Technologies Ltd., posted a 35 percent rise in first quarter profits on Wednesday.

Nasdaq-listed Infosys develops applications, designs supply chains and offers back-office services.

A company release said its net profit rose to 10.79 billion rupees in the quarter ended June from eight billion rupees reported in the same period a year earlier.

A poll of 10 brokerages had estimated that Infosys’ net profit would be 9.7 billion rupees.

Infosys shares had fallen four percent in April-June.

Infosys Technologies Ltd. provides consulting and IT services to clients globally - as partners to conceptualize and realize technology driven business transformation initiatives. With over 75,000 employees worldwide, it uses a low-risk Global Delivery Model (GDM) to accelerate schedules with a high degree of time and cost predictability.

As one of the pioneers in strategic offshore outsourcing of software services, Infosys has leveraged the global trend of offshore outsourcing.

Infosys was recently applauded by Wired magazine for its unique offshore outsourcing strategy. It provides solutions for a dynamic environment where business and technology strategies converge. Its approach focuses on new ways of business combining IT innovation and adoption while also leveraging an organization’s current IT assets.

Source:inhome.rediff.com

It is fairly well-known that a lot of hay stands to be made while the sun is shining. However, the Indian software industry, which earns over $30 billion from exports, made its fortune, and reputation, when a pall of gloom had enveloped the global community of computer users.

As the new millennium approached, the cloud of Y2K - short for Year 2000 - gathered over the computer systems, whose dates were configured in the mm/dd/yy format. Thus Year 2000 would be abbreviated to 00 and show in the system as before 1901.

It raised the spectre of a worldwide crash, especially in the financial system, as the computers were expected to go haywire on January 1, 2000 and spark a loss of public confidence.

This turned out to be the new dawn for Indian IT firms, and they have not looked back since.

Even in the years before the economic liberalisation of 1991, the government had a software bias. For instance, it revised the Software Policy in 1986 and, a couple of years later, launched the Software Technology Park of India scheme.

This was also the year when the National Association of Software and Service Companies was formed. This had put Indian software companies in a position to cash in on the correction required to ward off the Y2K threat.

January 1, 2000, passed off virtually free of incidents. However, Richard F Celeste of the University of Colorado terms it the “single phenomenon” that launched India as a serious player in the world economy.

He recalls that there was a huge demand for software engineers and programmers to fix Y2K glitches that threatened to disrupt everything that was computer-driven: from flights to vital data.

The supply of local professionals fell short of meeting the demand and Indian talent rushed in to fill the void. Y2K served as an extended audition for Indian software capabilities and allowed them to introduce themselves to major American companies. With that came the realisation that there were other services, too, that could be sold in the US.

“India had plenty of coders. The Y2K phenomenon helped Indian IT firms achieve scale. And this was the beginning of the outsourcing era,” explains Pradeep Udhas, global partner-in-charge, sourcing advisory, KPMG.

Since the Indian IT firms were “working on every line of code”, they got to know the client’s businesses so well that most foreign firms retained them to maintain their systems as well.

The rules of the game, however, are changing; India’s low-wage advantage was not going to last forever. Wages have been increasing not only in India, but also in the other low-cost offshore markets like Romania, Poland, China, Vietnam and the Philippines.

At a macro-economic level, despite higher wage inflation in low-cost nations, the indexed wage differential would still be considerably lower due to the low base wages in such countries.