Business Facilities - December 2007 - (Page 47)

by year’s end, with an estimated annual growth rate of more than 19%. The forecast includes IT, BPO (business process outsourcing) and call center services, as well as the onshore and offshore delivery of outsourcing services. India continues to lead the way as an offshore destination, forecast to capture $34.1 billion in total revenue by the end of 2007, and claim an estimated 11.5% share of the global market, according to the XMG study. India’s advantages are its talent pool, including 350,000 college engineering graduates per year, and its English-speaking population, about 2.2 million people, according to the Zinnov research group. When offshoring emerged as a common business tool in the late 1990s, U.S. companies (and their customers) simply found it easier to communicate with vendors in India than vendors in other countries suitable for outsourced operations. NEARSHORING is a form of offshoring in which a business activity is moved to a nearby country in order to avoid time zone or language barriers. Many U.S. companies have chosen to move business functions to Latin America, the Caribbean, and Canada. Though the term is derivative of offshoring, the Mexican-based IT services company Softtek copyrighted the term Near Shore in 1997, promoting Mexico’s proximity, cost structure, and international trade agreements as a more convenient alternative to offshoring. “Those are the key reasons for India,” says Vamsee Tirukkala, cofounder and managing principal at Zinnov, a company that assists other companies with offshoring strategies and operations. “Also, Indian companies have much more experience now. They have a 10- to 15- year head start over the others. They have a maturity of taking customer requests and delivering them.” The leading Indian offshore service suppliers (such as Satyam, Wipro, and Infosys) have experienced tremendous growth in recent years, and have broadened their services portfolio, capturing up to 40% of the most sophisticated clients’ IT services spending, according to Forrester’s study. Behind India in the offshoring race is China, with an estimated $13.1 billion in offshoring revenue by year’s end, and a 4.4% share of the global market. Following behind China are the Philippines and Malaysia, at $4.1 billion and $3.6 billion, respectively. “While it is no surprise that India and China continue to lead amongst the offshore countries, our study also showed a noteworthy insight to those following the growth of other offshore countries in Asia,” says Lauro Estimated Number of U.S. Jobs Moving O shore, 2003-2015 2003 Management Business Computer Architecture Life sciences Legal Art, design Sales O ce Total 3,500 30,000 102,000 14,000 300 6,000 2,500 11,000 146,000 315,000 2004 15,000 55,000 143,000 27,000 2,000 12,000 4,500 22,000 256,000 540,000 2005 34,000 91,000 181,000 46,000 4,000 20,000 8,000 38,000 410,000 830,000 2006 42,000 105,000 203,000 54,000 5,500 23,000 9,000 47,000 475,000 960,000 2007 48,000 120,000 228,000 61,000 6,500 26,000 10,000 55,000 541,000 2008 64,000 136,000 247,000 70,000 9,000 29,000 11,000 67,000 616,000 2010 106,000 176,000 322,000 93,000 16,000 39,000 15,000 97,000 815,000 2015 259,000 356,000 542,000 191,000 39,000 79,000 30,000 218,000 1,600,000 1,100,000 1,200,000 1,700,000 3,400,000 SOURCE: BUREAU OF LABOR STATISTICS AND FORRESTER RESEARCH, INC. BUSINESS FACILITIES 47

Table of Contents Feed for the Digital Edition of Business Facilities - December 2007

Business Facilities - December 2007 Contents First Word Snapshots Metro Spotlight: Albuquerque, New Mexico Corporate Moves: North Carolina 2007 Ecomonic Development Deal of the Year Awards State of the Year Seeking Supply Chain Solutions Mississippi Means Business Corporate Moves: South Carolina Biomedical Momentum in Florida's High Tech Corridor Trends in Offshoring Metro Spotlight: Stillwater, OK Metro Spotlight: Atlanta, GA Advertiser Information 2007 Salary Survey

Business Facilities - December 2007

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