6 Indian cities among global BPO hotspots

Six Indian cities are among the eight top global destinations for outsourcing according to a new survey.

Manila and Dublin also figure in the top list of 8 outsourcing destinations according to Tholons Top 50 emerging outsourcing destinations survey.

The 'Next 10 Outsourcing Destinations' is dominated by China's Shanghai, Beijing and Shenzhen, Vietnam's Ho Chi Minh City and Hanoi, Poland's Krakow, Argentina's Buenos Aires, Egypt's Cairo and Brazil's Sao Paulo.

"For chief information officers today, finding a centre of excellence is more than just lower cost. It must consider location, risk mitigation for business, cultural affinity and scalability of the skilled workforce," Avinash Vashistha, CEO of Tholons says.

Seven Chinese cities - Shanghai, Beijing, Shenzhen, Dalian, Guangzhou, Chengdu and Tianjin - and six Indian cities - Chandigarh, Kolkata, Coimbatore, Jaipur, Bhubaneswar, Thiruvananthapuram - make it to the list of next 60 outsourcing destinations.

Check out the world's top outsourcing destinations...

Bangalore

India's Silicon Valley, Bangalore, has managed to retain its leadership for the fourth time. Bangalore's advantages are a high-tech talent pool, thanks to a number of good educational institutions in the city. The city scores high on engineering services, application development and maintenance outsourcing and business analytics.

India continues to top the list with revenues of $40 billion in IT-BPO export services in 2008. Indian IT-BPO export services posted 35 percent year-on-year growth rates in the last five years.

Delhi NCR

The Delhi NCR region beat Chennai to win the second position.  Delhi scores high with well developed contact centres. Delhi-NCR (National Capital Region), which comprises the three cities of Delhi, Noida and Gurgaon, offer a conducive eco-system for business analytics, finance and accounting, software development, product development, engineering services and contact centre services in English.

However, the high-end, complex functions are not offered at a lower cost, the study states. Asian cities are the ones that rock the top 50 cities chart.

However, an interesting point is that not only the tier-1 cities in the Asia-Pacific region are ruling the outsourcing industry but also many tier-2 and tier-3 Asia-Pacific cities are fast emerging as outsourcing destinations.

Mumbai

Mumbai moved up four places to claim the third position. Mumbai city has established itself as a outsourcing hotspot with various factors like infrastructure, a large talent pool of around 60,000 employees in the BPO sector and developed policies.

Compared to the previous year's rankings, this year's study reveals minimal shifts in rankings because of the overall slowdown in the pace of outsourcing activity in the face of global recession.

Interestingly, India's FDI inflows posted the largest increase globally at 46 percent in 2008 -- from $25 billion to $46 billion even as global FDI flows decreased from $1.9 trillion to $1.7 trillion and several developing economies struggled to acquire investments from client nations.

Manila

Manila is the fourth best outsourcing destination. Cities in the Philippines score high on their large English-proficient workforce in catering to the US customer-service market. Quezon City and Mandaluyong City are the two new entrants from Philipines among top emerging outsourcing hubs.

Dublin

Dublin is ranked fifth among the top outsourcing nations. Dublin scores on application development and maintenance outsourcing and research & development services. Canada, Russia, Mexico, Vietnam, Poland are listed as 'Top 5 Emerging Nations'. The difference between the 'Top 5' and the 'Next 5 offshore' nations is most pronounced in the service level maturity, the study said.

Chennai

Chennai has fallen to the sixth position. It was ranked 2nd last year.  Chennai remains India's second-largest exporter of software, IT and related services and contributes 39 per cent of Tamil Nadu's GDP.

"The service providers need to think through their offerings so as to differentiate as the competitive advantage is rapidly vanishing due to cut throat competition and market saturation," adds Vashishtha.

Hyderabad

Hyderabad is ranked at the 7th place this year with good engineering design services and application development and maintenance outsourcing services.The study lists India, Philippines, Ireland, China and Brazil among 'Top 5 Offshore Nations' "with a high degree of maturity and record of successful delivery capabilities."

Pune

Pune is ranked as the 8th best destination for outsourcing. The city has established itself as a centre for engineering design services, finance and accounting services, legal services and good network of contact centres.