In this issue, Jag Dalal, COP, Director of Thought Leadership, IAOP provides some perspective on how the industry has – and continues to – evolve. Read on for his analysis on offshoring work coming back to the U.S. and a look at an old strategy that doesn’t necessarily work in digital times.
In recent years, the growth of offshore software work is slowing with business returning to the U.S. as salary advantages lessen and customers desire working with providers in the same time zones. “Domestic sourcing is here to stay, and it’s going to grow rapidly,” said an analyst at the research firm Gartner.
This article documents why outsourcing service providers are focusing on the U.S. as a preferred location to provide their services. It is not just a knee-jerk reaction against offshoring but a recognition of the talent and opportunity that exist within the U.S.
The author documents several service providers – including Nexient and Rural Sourcing – who have chosen various locations for their centers and have successfully developed the market. A well-known Indian service provider (Peopleshores) known for opening centers in remote locations in India is focusing on the U.S. and has opened two centers.
Companies that migrate workloads “as-is” to the cloud – a strategy known as lift and shift – run the risk of losing most, or even all, of the hoped-for savings of winding down costly on-premise data centers, Bain & Co. reports.
Lift and shift strategy for outsourcing has been around since the start of the industry. In the past, this reflected how service providers can “lift” work from the customers and “shift” them to a lower-priced location to provide the same services at a cheaper price. With the advent of cloud computing this has taken a new twist.
However, as the article points just shifting to the cloud “as is” increases costs and reflects on the inefficiencies existing in the process prior to the shift. This is yet another reminder of the old adage: “mess outsourced is still a mess.”
Jag Dalal is IAOP’s Chief Advisor, Thought Leadership. He is a world-renowned authority and coveted speaker on management strategies, technology, and outsourcing. His deep experience as a business executive who contracted for these services as well as his leadership experience in establishing outsourcing practice for some of the world’s largest professional services companies; allow him to bring a unique perspective to consulting. JDalal Associates, LLC specializes in consulting in the field of Information Technology, Change strategies and Business Process outsourcing. His clients range from Fortune 100 companies to small “startup” companies from around the globe.