India is among the biggest outsourcing hubs in the global market. With the huge demand for cost reduction and higher profitability, outsourcing has become prominent and relevant to businesses.
In fact, various multinational companies and large corporations seek optimization by outsourcing to developing countries as it greatly impacts their scalability.
India, the second largest country in terms of population with 1.4 billion inhabitants, is emerging as the most marketable country in terms of quality and affordable workforce.
Aside from its population density, there are more factors as to why corporations outsource to India. The succeeding sections will elaborate on this.
India’s current outsourcing sector
In terms of outsourcing, India has established itself as a leader across industries. With its population alone, and the scientific orientation of its universities and colleges to produce technically skilled graduates, India is in a competitive position.
Additionally, India has welcomed BPO companies that have most of their backend support outsourced in the country. The same goes for the accounting and finance industries.
Companies and industries that continue to outsource and tap into Indian talents are:
- IT Sector
- Call Centers
- Accounting and finance
- Manufacturing
- Production
5 reasons global companies outsource to india
There are various countries companies tap into for their operational needs. Like the Philippines, India is a go-to destination for conglomerates and small to medium enterprises.
In fact, the outsourcing industry has become so lucrative that it has a 7.4% contribution to the country’s GDP.
This economic benefit will not be realized without the domestic factors that enabled it, which include the following:
1. Qualified and skilled workforce
Owing to its sheer population, India has one of the largest workforces, second to China. With most of its graduates and professionals focused in IT and scientific fields, the Indian workforce is well-positioned to cater to the needs of the IT-BPO industry.
Indian professionals are not just technically capable but superior to their contemporaries in terms of IT and software development. This is why many companies opt to source services to the country to ensure that their technical requirements are met.
Further, many Indian professionals are English proficient, have excellent computer skills, and are well-trained in business operations. It is also easy for them to adjust and get along with different nationalities.
2. Appealing business climate
India has been in the outsourcing scene for decades. They have mastered the ins and outs of the industry, making them a reliable and trustworthy partner.
This has also allowed their business work culture to be receptive to changes and flexibility. Multinational companies find it easy to bring fresh insights, ideas, and challenging development models.
Multinationals will benefit from this as they can easily introduce technologies that the Indian workforce can adapt, study, and implement.
3. Time zone variations
Being able to operate 24/7 is a huge advantage in outsourcing. With the various differences in time zones, there are times that work is completed at night. This ensures efficiency and the continuation of business operations.
With every hour equating to money, companies that can operate all day long can earn more, scale faster, and deliver more projects. Satisfaction rates of customers are improved, while the reputation of the company increases.
The Indian time zone has become a huge factor in all of its business deals with multinationals. It is 5 and a half hours ahead of GMT and 10 and a half hours ahead of EST.
These inherent advantages have given them the flexibility to make business arrangements with various companies and regions without suffering any major backlogs.
4. Language advantage
The Indian workforce has in-depth knowledge in terms of the English language. It has been the medium of instruction since the Elementary level, while all universities and colleges have made English the main mode of instruction.
This has trained the minds and tongues of Indians to think and speak in English. Not to mention that historically, India was a British colony in 1800 which also contributed to their affinity with the language.
Language is important to any work since miscommunication is costly, especially in outsourcing. The lack of understanding will result in errors and concerns, which can delay the delivery of work or hamper output quality.
5. Stable government support
India is a democratic country. Its government is established and has experienced stability for the past 60 years. Westerner’s values are well-entrenched in government practices owing to its history.
This has resulted in the warm and welcoming attitude of the government towards foreign companies and multinationals. They have tweaked their foreign policies and adjusted foreign ownership to favor 100% foreign equity.
This resulted in the influx of investments and support from local and international businesses, especially the IT sector.
To make the IT-BPM even more adjusted, the government set up a Ministry of Information Technology. It approves, reviews, and implements all IT-related projects and activities in the country.
This has made the overall environment and infrastructure of India supportive of the needs of the IT sector in general.
Why outsource to India?
The primary reason to outsource to India is because of the lower cost of business operations. The country has been in the outsourcing industry for decades.
BPOs in the country fully understand the client’s needs and can cater services according to their requirements and budget.
But just because the cost of outsourcing is low, the quality of output and services do not diminish. In fact, Indian companies provide better and quality services at affordable rates.
In addition, most Indian companies have ISO-9000, which shows they are not just technologically equipped but experts in the IT-BPM sector.
This explains why most Western countries like the US, Canada, and other European countries have tapped Indian companies time and time again.
