Source: www.zdnetasia.com

India and China continue to lead in Asia’s offshoring activities, while Philippines’ growth has exceeded analyst expectations, reveals a new market report.

According to XMG’s latest study on the onshore and offshore delivery of outsourcing services, India will account for 11.5 percent of the global market in 2007, compared to China’s 4.4 percent share.

India, the world’s top offshore outsourcing destination, will grow at a compound annual growth rate of 29.5 percent to reach US$34.1 billion in revenues by the end of 2007.

The research firm also said India will continue to lead the offshore segment through 2010 with at least 15 percent share.

China’s 2007 revenues are forecasted to hit US$13.1 billion, registering a compound annual growth rate of 47.9 percent.

However, India and China are not the only markets to watch.

Lauro Vives, chief analyst at XMG, said: “While it is no surprise that India and China continue to lead amongst the offshore countries, our study also showed a noteworthy insight to those following the growth of other offshore countries in Asia.

“The Philippines is experiencing an unprecedented growth rate of 62 percent [which] will surpass Malaysia in 2007,” he added.

According to the XMG study, Philippines’ revenues are expected to grow to almost US$4.1 billion, garnering 1.4 percent of the global market.

“The Philippine industry has far exceeded all analyst expectations,” Vives said.

In comparison, Malaysia’s revenue forecast by year-end is estimated at US$3.6 billion, or 1.2 percent market share.

In 2006, Malaysia and the Philippines were neck and neck with 1.04 percent and 1.02 percent share of global revenues, respectively, XMG said.

Despite a projected 38 percent growth this year, Malaysia’s growth is being outstripped by other markets, primarily due to the country’s lack of manpower to sustain the growth of its offshore and outsourcing industry, the report noted.

“Locators are turning to other countries where there is headroom for further growth and expansion,” Vives said.

Looking forward to 2008, the study predicted “turbulence but continued strong growth in the offshore markets”, citing the rising costs and the continuing depreciation of the U.S. dollar.

The report also noted the rise in real estate prices and the rising cost of operations in India and the Philippines due to wage rate hikes. Both India and the Philippines are expected to experience continuing general wage increases of 11 percent and 8 percent, respectively, due to the talent supply challenge.

According to XMG, the global outsourcing market for IT, business process outsourcing, and call center services is expected to grow by 19.3 percent to top US$297 billion this year. By 2010, the market is projected to be worth US$450 billion.

Source: economictimes.indiatimes.com

BPO major HCL, which has reposed faith in trouble-torn Northern Ireland since 2001 when Western companies were chary of investing there, has spread more cheer by employing its 2,000th employee in the region. Many view HCL investing in Northern Ireland as one of the foremost landmarks of India-Britain relations during Tony Blair’s tenure as prime minister. Since 2001, other Indian companies such as Firstsource, Pix Transmission and Tech Mahindra have followed HCL into the region.

HCL has so far invested £16 million in three expansions in Northern Ireland in the last seven years — the most recent led to the development of a second BPO/contact centre in Armagh. It has now hired the 2000th employee in the region.

From its centres in Northern Ireland, HCL provides a range of high value BPO, contact centre (including multi-lingual) and online services to a range of clients from sectors as diverse as telecoms, retail, banking, media, publishing, utilities and technology.

According to Jeremy Fitch, managing director of business (international) at Invest Northern Ireland, a regional development agency, “HCL BPO Services is a valuable asset to the local economy. Since 2001 this global service leader has not only offered varied career opportunities for talented local people, it has repeatedly invested in its employees as part of a corporate commitment to training and development.

“Recruiting its 2,000th employee is a tremendous achievement and clearly communicates to other global organisations that Northern Ireland is the most competitive European location available.

“This announcement is evidence of the growing partnerships that are developing with the Indian business world in terms of both inward investment and export opportunities, and it is particularly fitting that this announcement is made as our local business community fostered even stronger links with India during the recent Invest NI trade mission.”

HCL BPO Services UK senior vice president and general manager Kevin Houston, for added: “I am very excited by the progress achieved to date and by the operation’s long- term potential.

“Since HCL BPO Services was originally established in Northern Ireland in September 2001, the company has grown locally and globally. We now employ 2,000 in Northern Ireland and over 13,000 people around the world.

“Our two centres in Northern Ireland are complemented by a network of nine service delivery centres in India and our NI expansion is based on HCL’s realisation that while outsourcing to India can produce cost savings of up to 60 percent, this differential by itself is not sufficient to build a global BPO services company.

“For us in Northern Ireland, this means that while our India centres are an integral part of the solution we offer our clients, the Belfast and Armagh centres offer us an opportunity to tap into another skilled workforce which will enable us to service European markets even more effectively.”

HCL BPO Services president and CEO Ranjit Narasimhan, echoed Houston’s enthusiasm: “Independently conducted research has established that Northern Ireland’s people, infrastructure and cost base make it the best place in the UK - if not in Europe - to set up a customer BPO/ contact centre.

“Having been operating here for nearly six years, we’re delighted at the speed with which we’ve been able to establish a highly efficient, highly regarded operation in tune with our global ambitions.

“Now benefiting from HCL Technologies’ financial strength, global reach and our high technology and CRM capabilities, Belfast has become an essential part of the highly innovative business model that we’re building”.

“It’s a model that is still relatively unique in our industry. But it is one, I believe, that others will have to try to replicate sooner than later if they are to make the most of the global opportunities that now exist in offshore business process outsourcing.”