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Why Companies Outsource to India? [Infographic]

Last updated: 02 Apr, 2021 By | 6 Minutes Read

Why businesses outsource to India? Is it just because of cost-saving benefit or quality of work or time-zone advantages? Well, the answer is all of the above. It has been a long journey for India to reach a pinnacle in outsourcing.

A report cited by researchers says that among 80% of Europeans and US outsourcing firms ranked India as their number one outsourcing destination. It will be an intriguing foreshadow of how outsourcing trends emerging in the changed geopolitical and economic equivalence between the developed and developing nations.

However, there are many outsourcing competitors emerged for India including countries like China, Mexico, Ireland and the Philippines, but India has managed to outwit all others and loom as the top outsourcing harbor.

What enforced companies of developed nations to outsource?

With an increasing pressure to be more innovating, embracing new technologies and for surviving in this competitive market businesses were willingly looking for an alternative to meet all their needs. So, the term outsourcing became the new buzzword in the 90s for business industry across the globe. As it not only reduced the burden of non-core activities but played a very important role in the growth of the business.

Here are few points that enabled businesses to prefer outsourcing:

  • The emergence of new technology
  • Increasing competition
  • Expensive labor
  • Time constraints
  • Reducing operational costs
  • Sharing risk equally with a partner firm

But, why companies choose India as their favorite outsourcing destination?

1. The labor cost in India is much lower as compared to other outsourcing locations, but that doesn’t mean the quality of work is poor.

As India has the highest ISO certified firms so the quality is nowhere compromised. For example in the US, if you hire an in-house developer it may cost you around $80 per hour, whereas if you outsource to India it can be negotiated around $15 per hour. So you can say that outsourcing is one of the cost-effective solutions for businesses in the developed countries.

2. According to a survey, around 350 million people in India speak English, which is one of the great benefits for businesses to communicate without any language barrier.

Moreover, India has more English-Speaking people as compared to US and UK, even, road signs in India are marked in English and Hindi. This is typically the effect of British colonial rule, which resulted in English being taught in India at very initial stage in schools.  Besides, people are keenly available on Skype, Hangout for a face to face interaction as per the convenience.

3. Besides, cost-saving factor, even the quality service offered by India has made it the front-runner in the outsourcing industry among others.

Recently, The National Outsourcing Association (NOA), in its Annual Offshore Outsourcing Conference, revealed the reason behind why International companies are choosing India as their preferred destination, “Cost reduction was only part for the reason that companies were considering offshore outsourcing, there were benefits to be had in time-to-market and quality, leading to an adage that companies initially chose India to save costs but stayed for the speed and quality!”

4. With the population of around 2.1 billion people, around 3.1 million students are added to the workforce each year in India.

The talent pool in India is unmatchable as the employees are well-qualified from the finest universities with great intelligence and humor. Recently, Google has announced to embark its new Research & Development Centre in India, this move reflects Google’s confidence in Indian’s vast talent pool.

Moreover, multi-billion dollar companies outsource to India including Cisco, Oracle or Hewlett Packard as they get easy access to talent, quality results in fast turnaround times.

5. Indian outsourcing companies are able to offer the quickest and quality time-to-market due to time zone differences.

The 12-hour time differences between India and USA provides companies with plentiful opportunities for work to be completed earlier than predicted, leading to greater efficiency, increased productivity and more time to work on other crucial accountabilities. So, India is able to serve 24/7 to various countries.

6. Outsourcing services are used by businesses to focus on their competencies rather than managing non-core tasks.

When the business scale up you need to deal with many customers efficiently to survive in this competitive market and handling plethora of customers can enable you to focus on marketing, sales, accounting, and other core tasks. This will eventually result in poor business productivity. So, outsourcing service providers of India can help you with various back-office services that you wish to outsource.

7. India is a developing nation and well-equipped with all the latest technology, ISP, cellular networks in all major cities and towns.

So, India is able to offer the best in software technology and customized solutions for any outsourcing service. Moreover, the Indian government has invested heavily in infrastructure and technology that reflects international standards.

OUTSOURCE TO INDIA

Conclusion

Make a final decision to outsource to India and witness a remarkable growth in business productivity and profits. Doing so you can gain a competitive edge over your competitors and position your business at the top of the market.

Are you planning to outsource your value-added tasks to a reliable business outsourcing company? Cogneesol offers world-class back-office services to various companies worldwide, such as finance and accounting, legal support, data management, research and analysis, insurance back office support etc.

Get in touch with us today for a free quote and trial.

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