Recent research by the National Science Foundation stated that a number of US firms ranging from pharmaceuticals to semiconductors are outsourcing R&D and Innovation, with foreign-based Automotive R&D accounting for nearly 40% of the total R&D among all US companies. India and China rank foremost among suppliers of innovative research and development by providing the complex knowledge that only a broad network of specialists can offer. Here are some of the reasons behind the growing demand for R&D and innovation outsourcing.
Availability of a huge talent pool: Countries like India and China continue to be important suppliers of intellectual property, since they have an abundant supply of talented technical and engineering graduates.Jeffrey Phillips, a senior leader at OVO Innovation says, “Soon, countries like India and China will do what Finland has done – match the US in innovation research and output, no longer following our lead but competing with us for the innovation lead.”
The evolution and maturity of the Indian BPO sector has given rise to yet another trend in the global outsourcing scenario: Knowledge Process Outsourcing (KPO). KPO involves the outsourcing of knowledge intensive services that deal with the creating, sharing, maintaining, tracking and disseminating of knowledge. This industry is not restricted to the IT or ITES sectors only, but also includes other sectors like Intellectual Property related services, Business Research and Analytics, Legal Research, Clinical Research, Publishing, Market Research and many more.
India: The Preferred Destination
India, with its large pool of knowledge workers has the capability to cater to the KPO industry by providing specialized domain workers. Furthermore, the talent available in India is much more affordable. In the Indian context, KPO salaries could be 25-50% higher than those offered to the same domain experts such as Engineers, Doctors, CAs, Lawyers, Architects, Biotechnologists, Economists, Statisticians and MBAs.
The global outsourcing market has witnessed major changes during the past few years. Based on these changes, outsourcing professionals and industry leaders have made a few predictions as to what the trends will be in 2011. Here is a quick look at the top 11 outsourcing trends predicted for this year
1. Increased Political Acceptance for Outsourcing
Greater political backing for outsourcing is expected in 2011, especially after US President Barack Obama’s visit to India in Nov 2010.