BUSINESS PROCESS OUTSOURCING TO LDCs - INDIA

World Economic Geography

Hippo Channel Present

OUTLINE

Outsourcing Trend• Terminations

LDCs Outsourcing BPO

• Reality trend Kinds of service activity Destinations

TERMS

• LDCs = Least Developed Countries

TERMS

TERMS

The process of arranging for sb outside the company to produce goods or services for that company

Do what you do best Outsourcing the rest

TERMS

BPO = Business Process Outsourcing Subset of outsourcing Involve contracting of the operations & responsibilities of

specific business functions / processes

Outsourcing: BPO Trend

• Kinds of service activity: call centers, computer network support, legal services, accounting, procurement, software development, R&D and engineering services

• Destinations (LDCs): India, Israel, the Philippines, South Africa

INDIA’S COMPETITIVE ADVANTAGE

1. Cost of production

30 to 40% of costs can be saved!

2. Workforce

Workforce

Large labor pool

Skilled and

talented workers

• 2nd most populous country•Working age: 64.3%

Skilled and talented workers

+ over 300 universities and 16,000 colleges providing broad education

+ the "English" Advantage

+ the presence of famous technical and business schools

3. Location:

• Time difference between the countries allows Indian companies to complete the task before people from US and European countries come into work

4. Faster and better communication:

• Advancements in calling, emailing and chatting

5. India has a Stable Government:

• Improving the infrastructure, communication, etc.

• Adopting IT outsourcing friendly policies in taxation, power, telecom, industrial parks, and special economic zones.

India enjoys the confidence of global corporations:

• 82% of the US companies ranked India as their first choice for software outsourcing

• Indian-Americans run more than 750 companies in America's Silicon Valley

India enjoys the confidence of global corporations:

• “You liberated your markets and now you have one of the 10 fastest growing economies in the world"

India: the most attractive destination for outsourcing

OUTSOURCING TO VIETNAM

Rank Country

1 India

2 Philippines

3 Ireland

4 China

5 Brazil

6 Poland

7 Viet Nam

8 Canada

9 Mexico

10 Russia

Top 10 Offshore Nations - Tholons/Global Services (2009)

ADVANTAGES DISADVANTAGES

Low Production Cost A strong labor Pool Stability Government Incentives Vietnamese diaspora: Vietkieu

Workforce limitationsTechnology InfrastructureScaleGovernment- related

2010 Region Country City Status 2010

1 South Asia India Bangalore ESTABLISHED

2 South Asia India Mumbai

3 South Asia India Delhi (NCR)

… EMERGING

16 South Asia Vietnam Ho Chi Minh City

….

21 South Asia Vietnam Ha Noi

60 Middle East and Africa

Turkey Istanbul

... ASPIRING

100

References

•  Building a Future with BRICs: The Next Decade for Off shoring by Mark Kobayashi-Hillary (Kindle Edition - Sep 30, 2007)

• Outsourcing to India: The Offshore Advantage by Mark Kobayashi-Hillary (Kindle Edition - April 19, 2005)

• http://www.vietnam-business-blog.com• http://www.globalservicesmedia.com• http://www.businessweek.com• http://madaan.com/outsourcingindia.html

Thanks for your attention!

Group Members:

Nguyen Thi Van Anh BAIU09086

Nguyen Thi Hoang Dung BAIU09061

Nguyen Hoang Lam BAIU09008

Nghiem Thi Thanh Huyen BAIU09050

Vu Thi Hong BAIU09046