The Future of Offshore ICT Outsourcing 2015
MBA students Berend Ten Wolde, Jordy Kool, Manikantan Muthu, Mona Matar and Zsolt Zsirony at the Rotterdam School of Management explored futures of ICT outsourcing. They brought in newer perspectives because of their different backgrounds, and having been involved in some way or the other with offshore ICT outsourcing. To download their full report in PDF please click here.
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Scenarios
Offshore Outsourcing Mania
In a scenario, where the rapid pace and extent of globalization is favoured by a stable political and regional uncertainty in the countries or regions where companies are considering to outsource their business processes or parts of it to, products and services can be provided through cross-border without limitations, and offshore outsourcing will flourish.
Offshore Outsourcing Phobia
Although the rapid pace and extent of globalization favours global trade, lack of global and regional stability has an even more serious impact on the offshore outsourcing. Given the fact that a large scale IT outsourcing contract has a relatively larger time horizon and reversing the trend in the short term (e.g. discontinue operations, lay off people) would impact the company economically, such a scenario would make firms wary of outsourcing their business processes.
The neo-Protectionist Wave
Even though regional political stability is guaranteed, protectionist measures, instead of open market and free trade, dominate the strategies in the developed countries, could seriously inhibit the rapidly increasing trend towards offshore ICT outsourcing.
Economic Melancholy
Lack of regional political stability followed by a series of protectionist measures and policies in regional economic blocks (e.g. EU) can have an even more serious impact on offshore IT outsourcing. This scenario, aptly called Economic Melancholy, puts the outsourcing industry and the firms in it, in a sense of despondency. This scenario could sound the death knell of the outsourcing industry, with all parties engaged in business within it, would not be able to reap the economic benefits, because of the socio-political environments they would be operating within.