New Delhi, Thursday, Jul 24, 2008: Contrary to popular belief, outsourcing is not a uni-dimensional solution created between an American company and its Indian partner to ship low-cost jobs. The global sourcing model is more like the complex manufacturing supply chain whereby companies build and utilize manpower modules to lower costs and address emerging opportunities and perceived threats of globalization, a survey has said.

The EquaTerra Advisor and BPO / ITO Service Provider Pulse Survey of 2Q-08 says that the services supply chains have become more diverse and widely distributed with large companies forming several business relationships with hundreds of service providers at a global level.

The survey of top outsourcing service providers and EquaTerra's own client-facing advisors has provided data on current and projected demand for outsourcing worldwide besides giving an insight into the impact of globalization on future outsourcing trends.
The survey indicates a growing interest in the flexible cost and operating models of outsourcing as the western companies seek ways to beat the economic downturn and counter lower-cost global competition. Over half of those surveyed admitted to investing in new or existing operations in foreign markets, including third-party tie-ups and settign up offshore operations.

The survey also says that demand for BPO and ITO would exceed the levels of the past two years though the demand levels were down 12 per cent in Q-2 of 2008 as compared to the first quarter (Jan-Mar). However, this was still significantly higher by seven per cent over the figure of Q-2 of 2007.

Service providers believe that their Q-2 pipeline for BPO and ITO deals would rise by 10 per cent with about 45 per cent of those polled expecting the trend to continue into the third quarter as well. Another interesting observation has been the increase in demand and supply of KPO functions such as engineering, research and development, financial modeling and analytics and legal processing work. The study also saw growth in areas like document services, real estate management and logistics services.