Challenges to be Faced by IT Offshore Outsourcing in 2017

February 14, 2017 4:25 pm | Updated 1 year ago.

IT offshore outsourcing means the process of subletting part or the entire IT function to an outsource vendor situated in an offshore location. The IT offshore outsourcing functions consist of software development, up gradation and maintenance of infrastructure and overall support. Offshore outsourcing generally emerges from the need to lower cost and improve the allocation of resources within an organization and deliver quality services to customers. The year 2017 will pose new challenges for the IT offshore outsourcing customers and market leaders will have to reexamine the existing approaches and take decisions thereof.
Changes will be visible across multiple sectors owing to the shifting political climate, security related challenges and new developing technologies.D2e takes a peep into some of the areas related to security, software development and IT offshore outsourcing as a whole that are most likely to undergo massive changes.

The challenges are:-
a) Changing Political Scenario – The new US President Donald Trump was vociferous against offshore outsourcing deals during his campaign and now is taking steps like banning Syrian refugees, envisaging on building a wall along the Mexican border, raising the minimum salary for H-1B visa holders. Trump also plans to withdraw from the NAFTA (North American Free Trade Agreement).All this culminated into rising insecurity among IT offshore outsourcing vendors who have been doing business in the US for quite some time. Moreover, post-Brexit conditions in Europe are also under review. The IT offshore outsourcing market will have to change fast and equip themselves with new strategies to face the changing political scenario.
The IT offshore outsourcing customers will enter into deals which have more flexibility, i.e. they are able to change according to changes in trade policies. They should also have the leverage to change locations, in the source, move to the cloud and other similar facilities. Some IT offshore outsourcing vendors may expedite offshore outsourcing deals.

b) Data security – IT offshore outsourcing customers and vendors will have to take into account cybersecurity and data privacy regulations. Countries around the world are bringing their own cyber security laws to protect data. Data privacy and the ultimate security of information related to a client is of prime concern. It offshore outsourcing vendors will have to consider these clauses and act accordingly.2017 will witness a lot of changes related to IP Protection and offshore outsourcing service providers are expected to keep pace with the changes taking place and adapt accordingly.

c) Big Data will rule – As organizations are gradually transforming themselves and becoming digital. Big Data analytics is occupying a position of prime importance. A recent prediction made by Ovum, a market research organization, features that Big Data will register a rise from $1.7 billion in 2016 to $9.4 billion in 2020. The year 2017 will witness exceptional changes taking place in the data analytics sector as the market will evolve and grow; skill requirements are changing along with a change in the day-to-day challenges. Along with Data Analytics RPA (Robotic Process Automation) will change the way IT offshore outsourcing is done. Traditional processes of doing IT offshore outsourcing business will give place to new procedures.


D2e predicts that IT offshore outsourcing organizations need to be agile and change with changing circumstances. Traditional IT offshore outsourcing approaches will give place to modern concepts.