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IT Offshoring – Challanges of currency, inflation, infrastructure, and innovation May 28, 2008

Posted by Bipin Agarwal in IT Offshoring - Future Direction, IT offshoring and Real Estate development.

IT offshoring has been a significant driver for lot of countries including India. Party will not last forever. Countries have to learn to justify the value proposition in the face of currency, inflation, infrastructure, and future technology innovation.

As economy gets stronger, currency is likely to get strong which in turn destroys the cost advantage. Inflation puts pressure on the companies to give pay raise, lack of infrastructure makes it hard to keep expanding the operation, and Business will stop seeing the value in offshoring.

Future of offshoring in these countries will be defined by providing innovative solution to above problem. One of the solution is to build a network of micro-cities that are safe, and self sufficient. Result is productivity improvement by eliminating the commute time, better quality of life, efficient land usage, and efficient usage of infrastructure spending.

One area that is being largely ignored by these offshoring destination is how to stay relevant in the wake of future technology innovation. Let us say lot of transaction processing is being moved to some of these offshore center. what happens to these operation when transaction processing gets automated?


Bipin Agarwal


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