Synergy Extreme India

In the legal services outsourcing expected to be strong, the competition increasing from new entrants, PwC survey finds.  The outsourcing providers around the world predict that the demand for their services is expanding rapidly and they are adding staff and investing in anew services to meet expected growth.  This is according to a new survey from Duke University’s Offshoring Research Network and PricewaterhouseCoopers.  In 50 countries, the survey of 514 outsourcing services providers that the industry is transforming due to the emergence of the new providers around the world and efforts of existing outsourcers to expand into a new markets.  The Outsourcing companies in North America and India which have a long dominated the industry that are being challenged by the competition from the Latin America, Eastern Europe and Asia in the service area including the contact centers business process outsourcing and information technology outsourcing.

A large number of the service providers expect to begin to a new software development and Information Technology contracts in the nest 18 to 36 months.  The number of the service providers planning to offer a new finance and accounting, human resources and innovation services in more than a doubled from the previous year.  The 62 percent of the service providers said that they plan to expand the scale of their existing offerings. India’s success as the world’s back office has motivated that the other developing countries with well educated and under-employed populations to seek to duplicate their experience.  The growing competition has transformed the outsourcing industry into a global race for market share.

Even though the India remains that the outsourcing markets leader, the other emerging economies are seeking to expand into the sector.  Among the efforts, the Chinese government has designated 20 cities as the outsourcing hubs in an effort to attract more international investment, while the Philippine government has declared outsourcing a priority industry.  The only 16 percent of Indian service providers see competitors from the other emerging economies as a threat.  The importance of the cost savings and efficiency improvements as the top strategic reasons for the outsourcing, the survey also found that the economic crisis of the 2009 reemphasized, followed by the access to qualified personnel.

In the legal services outsourcing emerging, the growth of the legal services outsourcing has been strong and it is likely to remain.  The survey found particularly in India, the legal services outsourcing is growing a rate of 40 percent annually in India with about 110 legal services providers in the country.  The Philippines and Sri Lanka provide 20 percent of the legal outsourcing, the economies benefits iof the legal services outsourcing are undeniable, it provides the highest profit margins for the services providers and as well as the highest cost savings for the companies.  The emergence of the available outsourced legal services and the impact of the economic condistions have changed the perception of the legal industry, once regarded as too sensitive to be outsourced.

There is other survey findings, the 70 percent of the outsourcing deals in 2008 were renewed at the expiration of the first contract, down from 72 percent in 2007.  The unrealistic expectations and the lack of the client outsourcing strategy were the top reasons for the contract terminations.  The near-shoring has gained momentum among companies using or considering outsourcing services.

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