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Outsourcing News for July 2010 | MicroSourcing

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NASSCOM Publishes Ethical Practices for Outsourcing

Trade body Nasscom forecasted that for the next decade, the IT-BPO industry in India will create 30 million jobs -10 million from direct employment and 20 million from indirect employment.

“There has been a 6-fold increase in direct employment. The number of direct employees in 2001 was around 4.3 lakh and now it has zoomed up to 23 lakh in 2010,” said Nasscom president Som Mittal. He added that best practices in the IT-BPO industry must be adopted, and firms must follow ethical hiring and perform background checks for workers.

At present, 37 percent of employees in the IT-BPO industry are women - 26 percent of which are chief wage earners. By 2020, about five million women employees are expected to be employed in the industry.



APAC Posts Lower Outsourcing TCV

The Asia-Pacific region posted a total contract value (TCV) of US$2.3 billion for the first six months of the year. This is significantly lower than 2009’s US$5.5 billion TCV for the same period.

According to TPI Index Asia-Pacific, this can be attributed to the slow outsourcing activity in the region, particularly the significant drop in the number of mega deals and contracts amounting to more than US$200 million, though Michael Rehkopf, partner and director of North Asia at TPI, said the market can still improve the figures. "In order to reach 2009 level, the industry will require a record US$8.7 billion TCV in the second half of 2010."

The region needs to close several mega outsourcing deals worth over US$200 million within the year to reach US$11 billion. While the industry had secured 18 BPO contracts and another 10 deals will be awarded within the year, these are considered small contracts when it comes to calculating TCV.



PH urged to tap into European outsourcing market

The European Chamber of Commerce and Industry in the Philippines (ECCP) urged BPO stakeholders in the country to tap and maximize the European outsourcing market.

According to ECCP Executive Vice President Henry Schumacher, the Philippines can have a bigger piece of the market compared to what India currently has. “Since Europe is also aggressively looking at opportunities from emerging countries in the East, now is the time for the entire Philippines to explore Europe since it is also the largest business process outsourcing market.”

Web design, IT, human resources, and back-office functions are some of the processes that can be outsourced to the Philippines. To take advantage of the European outsourcing market, Schumacher said the Philippines must initiate campaigns that will enable Filipino workers to have a better understanding of the European culture. He added that branding and highlighting what Filipinos can do will play a big role to help the country in tapping the foreign market.


In a relatively short span of time, Egypt has become a very favorable outsourcing location for IT companies.

Egypt a favourable environment for technical support outsourcing

With its low cost of living and a pool of highly skilled workers, the country now offers value similar to that of India when it comes to outsourcing costs, although the former still has its own advantages such as its geographic location, large number of graduates, and language skills. Banks like HSBC, IT firms such as Microsoft, and telecommunications companies including Vodafone and France Telecom have already set up operations in Egypt. 

“Factors such as the stability and growth of the Egypt economy; a concentrated pool of talent in Egypt and our historically strong relationship with the Egyptian government have all led to a favourable environment for the technical support of Microsoft Xbox to be located in Egypt,” said Aly Kamal, a spokesman for Microsoft Egypt.



RP BPO Fuels Expansion of Fastfood Chains

by: Karen Cayamanda

Friday, July 23, 2010 | Outsourcing News | Comments (0)

The rapid growth of the business process outsourcing (BPO) industry is driving the expansion of fastfood chains in Metro Manila.

CEO and President of Binalot Food Fiesta Rommel Juan said fastfood chains see a 15 percent sales increase particularly in known BPO areas such as Makati, Libis - Eastwood, Sucat, Ortigas, and Alabang. Surge in sales and expansion can also be attributed to the fact that the industry operates 24/7.

BPO industry boosts local economy

“This has boosted the local economy, creating more jobs and business opportunities not only for services catering to the increasing number of BPO workers,” Juan said.

Based on a different report, the country’s BPO industry is on its way to reaching its revenue goal of $9.4 billion for 2010. After six months, the industry had already posted $4.7 billion in revenues.



To stop the high attrition rate, which can be attributed to work-related stress, in the business process outsourcing (BPO) industry of the Philippines, the International Labor Organization (ILO) urged BPO companies in the country to implement policies designed to give employees more flexible decision-making opportunities and eventually reduce stress brought about by their working conditions.

ILO senior researcher John Messenger said there is also a need to implement stringent ways to ensure the health and safety of BPO workers who are on night shifts. "This is a rapidly growing industry worth and approximate $90 billion. A lot has been written about this phenomenon and its implications for economic growth and employment. However, very little is known about the working conditions in the BPO industry," Messenger said.

Health and safety of BPO workers on night shifts

Messenger added that in the study they have conducted, 49.2 percent of Filipino BPO employees noted that stress is a major concern. This can be due to harassment from clients, too much workload, monotony, and/or night shifts.



Survey Reveals Slow IT Outsourcing Growth in Europe

by: Karen Cayamanda

Wednesday, July 21, 2010 | Outsourcing News | Comments (0)

IT Outosurcing Growth Dwindles in Europe

According to the recent survey by sourcing consultancy firm Equaterra, the demand for IT outsourcing in Europe registered a slow growth rate of five percent in the second quarter of 2010.

Compared to 45 percent in the first quarter, only 40 percent of global sourcing advisers surveyed believed that the demand for IT outsourcing in Europe had increased. Moreover, 55 percent (36 percent in the first quarter) said there is slow activity in the economic environment, making business owners think twice about their outsourcing plans.

BPO demand, IT outsourcing and services, and internal process improvements were some of the factors that were considered in this survey.



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