{"id":1419,"date":"2012-01-09T09:05:00","date_gmt":"2012-01-09T09:05:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/sourcing-raj-part-ii_01091\/"},"modified":"2012-01-09T09:05:00","modified_gmt":"2012-01-09T09:05:00","slug":"sourcing-raj-part-ii_01091","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/sourcing-raj-part-ii_01091\/","title":{"rendered":"The Sourcing Raj Part II: \u201cYou don\u2019t have to be Indian to be a global outsourcing provider!\u201d"},"content":{"rendered":"
\"\"<\/em><\/p>\n

Would you kindly stay on the line to complete a brief customer satisfaction survey?<\/p>\n<\/div>\n

The main feature of 2011 was all about the demise of quick cost reduction as prime driver behind global sourcing<\/a>, and the focus on enterprises establishing a flexible global operational framework that can be effective in today’s environment. \u00a0<\/em><\/p>\n

Yes, cost prudence is always an ongoing concern, but it’s no longer the<\/em> differentiator; today it’s embedded in all forms of operation strategy and planning. Hence, this means\u00a0enterprises’ prime focus is fast becoming\u00a0global<\/em>\u00a0and not solely about being low-cost<\/em>. \u00a0This also means providers need to service their clients as global partners with global delivery capability.<\/p>\n

To this end, HfS Research Fellow and Sourcing Change protagonist Deborah Kops<\/a> completes her investigation into the dominance of India in the world of outsourcing, and whether or not the game’s up for non-Indian providers to come back into the picture. \u00a0Over to you, Debs…<\/p>\n

You don\u2019t<\/em> have to be Indian to be a global outsourcing provider!<\/span><\/p>\n

In The Sourcing Raj Part I<\/a>, I ticked off the reasons why non-Indian providers have had a hard time cracking the offshore outsourcing market. Indian players not only have a good 10 years\u2019 head start penetrating the market, a brand that makes India and outsourcing virtually synonymous, and an unparalleled onshore network of buyers and influencers that all know the secret handshake. But the good news for non-Indian providers is that the global economic map will continue to evolve, making it imperative to implement a portfolio approach in response to changes in markets, availability of talent, cost and other considerations. Those players with the stomach to check nationalism at their borders and follow a few simple rules can nip at the feet of the Sourcing Raj.<\/p>\n

You may not be familiar with the iconic 1970\u2019s ad featuring a Native American in full regalia eating a sandwich on dark bread. The tagline, \u201cYou don\u2019t have to be Jewish to love Levy\u2019s,\u201d did more to get Americans to eat something other than squishy packaged white bread than giving out samples in bakeries. Non-Indian providers have a legitimate role to play in global delivery, but it means they must approach the market differently. The market has evolved since the first Indian firms came onshore, requiring a different approach to an industry where offshore is frankly synonymous with India. It\u2019s up to the others to convince the market that it\u2019s possible to be a viable provider without a home base in India.<\/p>\n

Brand as a global, not a (name that country) provider.<\/strong> Take a page out of the book of several leading Indian providers. They no longer call themselves Indian; they proudly declare they are global players. They push very hard to emphasize their network of operations in a range of geographies, of which India is just one. Their mission statements no longer contain the aspiration to be India\u2019s number one (or two or three). They focus their messaging where their clients are, at the same time paying sufficient attention in their home markets to build enough brand to attract the right talent.<\/p>\n

Yet many offshore players doggedly play their country card in their branding. While having pride in the home office location is important, understanding that parochialism is the enemy of globalization is critical to getting on a revenue growth trajectory. Clients seek good delivery from markets with sufficient scale, talent and reputation to underwrite their decisions, and that perform as strong cogs in a global delivery model. At the end of the day, that\u2019s what matters. Providers that shed the trappings of their legacy location have a good chance to grow and prosper.<\/p>\n

Rapidly devolve management control.<\/strong> To be honest, it has taken the Indian firms far too long to realize that true globalization is more than locating cheeks in seats in other geographies, retaining tight control in India. Even today, look up some of the Indian majors and note that every key management position is occupied by someone in Gurgaon, Chennai, Mumbai or Bangalore. Many Indian providers talk the global talk, but often when it comes to making a decision, it requires a call to country code 91.<\/p>\n

Non-Indian providers have an opportunity to send the right globalization message now, leapfrogging the Indian providers by quickly devolving control into exporting markets. Clients increasingly look for leadership across geographies, signifying that the company\u2019s management is truly global, evaluating the provider on the extent to which there is local decision making authority. Take a page out of the books of the global majors such as Accenture or IBM\u2014locate key execs with real decision making authority in a range of geographies. It\u2019s the smart way to grow a business in a global world.<\/p>\n

Move quickly to develop a strong base of local sales and account management staff.\u00a0<\/strong>For years, Indian providers parachuted in sales and account management staff, thinking they were saving money, or even believing that local hires were incapable of understanding and selling the offshore value proposition. However, the industry now \u201cgets\u201d offshore; there is increasing recognition that one no longer had to grow up in India to sell or manage clients.<\/p>\n

The non-Indian player should aggressively seize the \u201cglocal\u201d high ground, declaring we\u2019re both global and<\/em><\/strong> local by hiring prodigious indigenous talent. Clients still prefer to do business with people they believe are fundamentally like them so putting a local face on the client interface goes a long way in establishing credibility.<\/p>\n

Declare your hand.<\/strong>\u00a0The market\u2019s far too mature and competitive to entertain provider neophytes who are continuously and publicly testing the market. The market looks for providers who can draw a line in the sand, saying what they can do, why they can do it, and for whom they have already delivered results. Do your homework, pick your service offerings and industries, and settle on an approach before you blitz the market. Trying to be all things to all people is a recipe for disappointment.<\/p>\n

Invest in marketing.\u00a0<\/strong>Jobs exporting markets cannot be conquered with a website that says little, an exhibit booth staffed by a smiling young lady,\u00a0 a thumb drive with a logo, or an occasional banner ad in a third tier industry publication. Assuming because you as a provider are the best in Wroclaw or Wuxi that the market will beat a path to your door is massively misguided. Sitting offshore and second guessing your target market is not only revenue-limiting, it\u2019s sheer hubris. Spending marketing funds sporadically tells the market you are not serious players.<\/p>\n

If it is not important enough to invest the right amount of money in effective marketing, why bother to enter a market? There\u2019s a direct line of sight between spend and results\u2014spend little, especially in the wrong areas, get nothing. Spend a lot on the wrong approaches, get little. Spend the right amount on channels that matter and it\u2019s a game changer. Figure out the right channels, the right approaches and spend the right amount of money, and the payback can be more than 25 times investment over time.<\/p>\n

Develop superior English language skills.\u00a0<\/strong>It\u2019s not enough to rely solely on state investment in English training when the provider\u2019s future is dependent on speaking the world\u2019s premier business language. Ensuring that everyone who interacts with the client at every level has a command of clear, contextual business English is not only an imperative and differentiator, it eliminates unspoken objections inherent in client teams. Playing the non-language dependent card no longer works.<\/p>\n

The Bottom-line: many non-Indian providers have the opportunity, but have a lot of work to do<\/span><\/p>\n

\"Deborah<\/a><\/p>\n

Deborah Kops, Research Fellow, Sourcing Change Management, HfS Research (click for bio)<\/p>\n<\/div>\n

Can non-Indian outsourcing providers end the sourcing raj? Certainly geopolitics, the state of the global economy, currency movements and, more specifically, the positioning of the IT\/ITES industry within India will affect the course of events. And it will take some time before the Chinese or Brazilian equivalent of the sourcing network becomes as insidious as that of the Indians. But much of the answer lies within the direct control of the non-Indian players. Will they play a global game? Will they place a bet on a few services, and make the requisite investment? Will their nationals start to appear on the rosters of client teams? Will they devolve management to other geographies? Will they spend the amount of money necessary to create a brand? Will they invest in training superior English speaking capability? Only time will tell.<\/p>\n","protected":false},"excerpt":{"rendered":"

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