Evaluating Offshore IT Outsourcing in India: Supplier and Customer Scenarios

This paper presents the findings from an ongoing research study on offshore IT outsourcing. Field work was carried out in India and in the UK to evaluate the scale and scope of outsourcing activities. CEOs and CIOs were interviewed in fifteen supplier firms in India and two customer firms in UK, about strategic positioning in the offshore outsourcing market; benefits and risks from outsourcing; and other demand and supply-side issues. The findings suggest that, though offshore outsourcing offers new business opportunities for IT suppliers, much of the outsourced work continues to be low risk and low value. The challenge for outsourcing suppliers is therefore to devise strategies to move from body-shopping work to low cost, high value contracts, without incurring additional risk.