How Indian service providers can survive new downfall in Indian Outsourcing Industry…
There are number of reports which claim that Indian Outsourcing industry is coming to its end. This might not be the case, but you can expect a great downfall in coming years.
The report analyzed the rolling out of global delivery centres by the UK’s 20 largest IT services suppliers – Accenture, Capgemini, IBM and HP among them - and found that of the 21 centres opened since January 2007, just two were in India. Findings that offer further evidence of the threat to India’s traditional dominance.
Source: http://blog.europeanleaders.net/procurement-blog/2008/3/11/indian-offshoring-dominance-under-threat.html
At this point, people associated with this industry are likely to have some sufferings. However, you can do something to help your career and minimize the effect of this downfall. Here are seven things which small companies or freelancers should consider:
- Select an Industry & Business domain to serve.
Indian Outsourcing was growing since last a few years, and it is pretty matured by now, but there are more countries like China, Morocco and Hungary, which are joining this global market and they might even have lesser prices than where we stand right now. This would result us in failing to compete over price. You can no more expect yourself to serve in multiple business domains or technologies, rather you’ll have to check for the market imbalances and then exploit them. A PHP developer might be easily available in other countries, but if you present yourself as an experienced Python developer – and if there is a demand, then you can charge your regular prices. - Public Exposure of your skills.
This might be obvious; you might not have got time to write or blog about your technical expertise. But now as more competition enters the market, you’ll need yourself to differentiate from others in some way. People like to buy from an expert not a follower. You need to show how your expertise can help them or their businesses. If you follow the point above, and target to selected industry only – that might even produce better results. - Develop passion or leave the Industry.
If you are not passionate about the industry, just quit and search for another Industry. Get yourself involved into an open source and let other people benefit from your passion. In long run, you will be the one who gets more benefits and success. - Stretch your skills to your limit.
I see a problem with many Indian programmers – they are not willing to learn new things. Many programmers I’ve worked with are satisfied with their present skill-set and don’t want to grow skills. They are happy with the pay-checks and increments they are getting. Some of these increments, if we look into depth are because of the boost in industry, not because a particular guy started working better or effectively. When this boom goes down, you will get lesser than what you are getting now. By continuously growing your technical skill-set you can survive. - Automate Automate Automate.
In order to work more effectively, we have to work more effectively than ever. To do so, you cannot increase time in a day – but what you can do is take advantage of the automation. Write your own code generators, reusable classes, or focus on automating and task you would do repetitively. If you spend even 1 hour daily on this – chances are you will achieve more for your clients in less time. - Start some side projects.
This might be a difficult one for many teams or individuals, but developing a side project (like a web app) can be turned as your asset – which should provide you not only money but the value to your customers. If you can create success from your own app, then you surely can help them out. Think building your services as a famous brand. - Learn to communicate with your clients in their own words.
Being too technical with clients sometimes helps, but when you learn their businesses and talk in their business terms it makes them more comfortable in dealing with you.
Why you need to do all this?
- The cost advantage for offshoring to India used to be at least 1:6. Today, it is at best 1:3.
- As the 1:3 cost structure becomes 1:1.5, it will soon become inefficient to use Indian labor.
- Jobs that are low value-added and easily automatable should and will disappear over the next decade.
- The Indians don’t do the thinking. The customers do. India executes.
- India’s $30 billion IT/ITES services industry, meanwhile, is slowly and surely losing its competitive advantage.
- Assuming a 15% year-to-year salary hike rate, and a 2007 cost advantage of 1:3 in favor of India, if U.S. wages remain constant, India’s cost advantage disappears by 2015.
- According to a report by Sramana Mitra
Still need another reason..?
- Abhimanyu Grover