I was reading an article where Gartner has predicted that India is no longer the hot shot offshore destination it used to be owing to a combination of recession, Mumbai attacks and Satyam. They have said that companies are choosing to source from other low-cost destinations in Eastern Europe, Asia and South America. While as a geo-diversification strategy this makes sense, we need to remember that many of the Tier 1 players themselves are setting up centers in other countries. Somehow, these kind of drastic pronouncements seem difficult to accept – especially, when the reasoning has holes. For example, one statement says very few companies come looking for 1000 member offshore teams these days – my take is do most clients start wth 1000+ teams offshore or it is built over a period of time? Also, the # enquiries that Gartner is receiving to source from India has come down from 80-90% to 60% – however, has the # enquiries stayed the same? In the current environment, it is higly likely to have come down. Similarly, there are other unexplained statements.
I think, India will play the lead role in an offshoring context and geo-diversification will be part of service providers and buyer’s strategy. With regard to Gartner’s view, I will treat it with the same skepticism as when they predicted in 2002 that China will overtake India as an offshore destination by 2007. The point is, offshoring will develop into a truly global ecosystem and India will be an integral part for some time to come at least.