According to a study published by London-based global management consulting firm, A T Kearney’s 2016 Global Services Location Index (GSLI), India become the world’s biggest outsourcing destination in terms of financial attractiveness and business environment.
- Other Countries in the list of top 10 following India includes China, Malaysia, Brazil, Indonesia, Thailand, The Philippines, Mexico, Chile and Poland
As per the study of A T Kearney, India and Philippines are considered as the greatest priority in case of outsourcing. Now the companies are hunting for new talent in tier-3 locations such as Surat, Nagpur, and Lucknow in India and Bacolod and Iloilo City in the Philippines, which is beyond these countries’ capitals and major cities.
- The advantage of tier-3 cities is the relative affordability of real estate as facilities in Nagpur and Ahmedabad are 25% to 30% cheaper than Kolkata and Delhi.
- Another advantage is the relative availability of labour, its lower cost and lower attrition rates.
- Many of these cities have highly developed educational infrastructure, ensuring fresh crops of qualified graduates.
What is outsourcing?
Outsourcing is an arrangement in which one company provides services for another company that could also be or usually have been provided in-house. Outsourcing is a common trend in IT & other industries for services that have usually been regarded as intrinsic to managing a business.
The GSLI was launched in 2004 which helps companies make key location decisions for offshoring and industry development projects with objective guidance.