[January 30, 2007]

voke Releases FutureWatch Outsourcing Report

By Susan J. Campbell

TMCnet Contributing Editor

In spite of the recent reports that certain companies are bringing back office applications and contact center operations back home, one analyst firm sees that the trend for offshoring not only will continue, but emerging nations will play a significant role in the growth of the enterprise.

voke inc., a modern analyst firm for the Web 2.0 world, has released its third consecutive FutureWatch report with a focus on outsourcing and the trend to move tasks to offshore providers.

This particular installment explains how emerging nations with strong technical backgrounds, such as India, China and Eastern Europe, will play a major role in the successful ecosystem of the hybrid enterprise. Released Tuesday, this report hypothesizes where we will see technical skills emerge and why software development standards will be driven to acceptance.

At the end of the 20th century, the trend for offshoring gained in popularity due to the potential cost savings involved. In fact, looking outside the U.S. was primarily driven by cost. Emerging nations today have populations that are increasing their technical skills and have become a haven for entrepreneurs and venture capital investments.

“As the nuances, positives, and negatives of using offshore providers became visible, the idea of team virtualization

was the most popular reason for outsourcing,” said Theresa Lanowitz, founder of voke, inc. in a statement.

“Now as teams are truly virtualized across boundaries, outsourcing is about to enter a new phase. Offshore providers will more than likely take on more technical roles and responsibilities while their clients concentrate on the core business and deliver strategic value.”

Previous FutureWatch reports releases by voke centered on IT Enterprise Management and Software Supplies — both of which supported the firm’s theory of using outsourcing. These reports also focused on the inherent innovation and skills that are being driven by the employment demands in India, China and Eastern Europe to supplement organizations. These earlier reports formed the basis for voke’s predictions of a forthcoming virtual and reliable wave of outsourcing.

The FutureWatch series of reports can be purchased at http://www.vokestream.com/subscribe.php. Interested parties can also view voke’s “What’s Next,” a free blog that examines issues resulting from technology challenges and identifies how technology must be exploited to move society into the 21st century. This free blog is available at http://www.voke.blogspot.com.

What is interesting about any study that examines outsourcing, especially when the practice is to move operations and activities offshore, cost and technology have been a major focus. Many companies, such as AT&T (News - Alert) and Dell, have found through experience that cost savings alone are not sufficient enough to warrant overseas operations.

The differences in cultures, service deliverables and security also have to be addressed. While technology can bridge the distance gap, it does not necessary address every issue and organizations are still at risk when outsourcing operations offshore. For this reason, all elements must be examined before this can be considered a viable or even profitable option.

Susan J. Campbell is a contributing editor for TMC (News - Alert) and has also written for eastbiz.com. To see more of her articles, please visit Susan J. Campbell’s columnist page.

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