With the advent of technology, ever increasing competitiveness and world becoming a global village, marketplace dynamics are forcing organizations to change the classical paradigm of an integrated firm, encompassing everything from processing of raw materials through to production, sales, delivery and after sales service of the product.

Pressures to grow, create product or service innovations, respond quickly to evolving markets and customer needs, and while all at the same time remaining price competitive, have led to the emergence of new business models that are driving organizations to restructure. The aim is to become lean flexible and more responsive. The organizations world over have realized that answer does not lie in simply finding new ways to cut cost or to increase their technology spending.

In this direction, organizations are restructuring around teams of knowledge workers with each bringing specialized talents to the integrated design, engineering, production, marketing and delivery of a product or service that creates the value for the organization.

With changes in the business environment over the years, new business models have evolved and the not-so-new ones have been refined. So has the role of outsourcing services, and the way businesses are leveraging them. Although organizations still look at outsourcing to deliver traditional benefits of cost containment, it is increasingly being leveraged by organizations to seek better management focus on core activities for strategic results. Businesses are now increasingly using outsourcing as a powerful tool to quickly accrue superior and measurable business results, across functions and business processes.

In light of the above, the following are the benefits of outsourcing to an organization:

• Productivity improvements
• Access to expertise
• Operational cost control
• Cost savings
• Improved accountability
• Improved HR
• Opportunity to focus on core business
• Improve upon the turnaround time for the work

With the significant change in potential reach and impact of outsourcing, the scope and definition of the later is also undergoing changes. Outsourcing truly has emerged as a strategic tool for organization to achieve high performance.

The next step of outsourcing is the evolution of Knowledge Process Outsourcing or the KPO as it is popularly known. KPO services would be rendered to businesses where in-depth analysis with high end knowledge are required or in judgment services like investment banking research, sales and marketing research, IP/patent research, R & D, legal research and case writing and even animation design.

A service provider in this category requires a very highly skilled manpower to execute such processes. It involves complex level of process, technology and services with a domain expertise.

India can be an ideal offshore destination for outsourcing due to a variety of advantages it has over other countries. Some of them are as under

• Assured availability of large skilled and qualified human resources
• Largest pool of English speaking population after USA and UK. In India 380 universities and 11,200 higher education institutions produce 2.1 million graduates each year. Further, it is expected that the number of people in the working age group in India will increase by 250 million from 2003 to 2020 at an average rate of about 15 million per year.
• Good quality products and services available at competitive costs
• State of art infrastructure of international standards
• Real Estate available at economical rates.
• Thriving democracy with liberal and stable economic framework and vibrant judiciary with a legal framework
• The political will and government’s proactive policies
• Virtual time difference with significant countries