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India losing its advantage in outsourcing

Indian IT service providers are losing their advantage against global competitors for providing IT outsourcing services as customer satisfaction levels fall. Satisfaction with Satyam declined 15%, TCS dropped 8% and Wipro fell 4%. Source

Less money-saving, more time-saving – Outsourcing Not Just a Way to Cut Costs Anymore

Companies are increasingly considering outsourcing as a time-saving tool for their core business processes during this recessionary times. So far, outsourcing was considered by the most as the money-saver in the first place and customers were happy to take a 20 per cent cost takeout from outsourcing deal. But today customer can take a 20 per cent cost takeout by reducing salary of his employees who will accept it just to save their jobs.

Today some see new slogan for outsourcing - efficiency, where customer wants to get better business processes from outsourcing providers in order to increase customer satisfaction and save more money.

One example of such modernization according to Suresh Vaswani, CEO of IT business at Wipro is to stream a company's collection process and cutting the time taken to bill clients. That reduction completely changes the game so far as the cash situation of the customer is concerned, and cash is king today.

Providing customers with modern systems such as client-oriented ERP/CRM platforms will allow them to control clients businesses better, cut the time for servicing, billing and optimize cash flow.

“But to do that company’s IT has to be adequately enabled, otherwise the processes cannot be changed appropriately” - stressed Vaswani.

Although outsourcing trends may change with this changing environment and outsourcing might acquire new watchword, businesses will continue to consider outsourcing as a main tool for cost-cutting and seek benefits from cheaper deals.