Companies that outsource their IT operations to offshore
locations are increasingly dissatisfied with the service they are
getting.
The annual offshore outsourcing survey from consulting firm
DiamondCluster International shows that the number of outsourcing
buyers satisfied with their offshoring providers has fallen from
79% to 62% over the year.
The number of organisations prematurely terminating an
outsourcing contract has doubled to over 50%.
DiamondCluster said the blame for the increasing dissatisfaction
could not be purely blamed on offshoring providers. Many purchasing
organisations still did not have the means of fully gauging the
success of their outsourcing strategies, despite many of them being
years into some contracts.
As the number of seemingly disgruntled buyers increases analyst
group Forrester Research, at its Prague conference this week, said
the organisations could only get value for money from offshore
outsourcing if they had full visibility of their existing IT
organisations.
India remains one of the most popular offshoring destinations,
although 40% of the DiamondCluster respondents expected to use
China for some IT functions over the next three to five years, up
from 8% last year.
The DiamondCluster survey was based on discussions with over 200
senior IT executives at “global 1000” companies, and interviews
with 240 senior executives at outsourcing providers.