The New Global Marketplace: Challenges and Opportunities for Indian Service Providers
Introduction
As Indian service providers continue their ascent up the industry value chain, they face profound new challenges in an evolving global market. Three stand out.
First, as outsourcing grows, so does the level of sophistication with which customers choose their vendors; in many cases, today’s customers are not just looking for low-cost approaches, but for providers who can offer close strategic partnerships and transformational ideas and services. To respond, all service providers will need offshore and onshore capabilities that meet the same global standard whether it is for new services or products, customer service, or operational efficiency.
Second, because talent with more than five years of experience is hard to find, salary bidding wars are the norm.
Third, profit margins are shrinking due to vendor competition and their willingness to accept smaller contracts in order build reputation.
The strategic challenge for the vendor is to:
- Devise new, high-value service and product offerings.
- Refine business practices that improve customer loyalty through better
communication and collaboration; innovative contracting arrangements;
and good human resource development.
To achieve these goals, project portfolio management (PPM) tools can help. This paper will discuss the use of PPM tools for improving the quality of vendor services in the context of the current BPO environment.
We first report the outcomes of semi-structured interviews conducted in 2005 and 2006 with 14 prominent Indian service providers and 14 of their largest customers from around the world. We then discuss a series of case studies of Primavera’s global customers to explore lessons learned about how service providers can and do use PPM tools to compete in the global marketplace.
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