Effect of Trump on Indian IT Offshore Outsourcing Companies

February 8, 2017 5:55 pm | Updated 1 year ago.

The meteoric rise of India as a leading IT offshore outsourcing destination is under the scanner post-Brexit and the ascension of Donald Trump as the new US President. Both this event has brought about changes in the immigration policy and visa norms. Indian offshore outsourcing companies are well-known for catering to the needs of companies in America and Europe. The services provided by these Indian companies range from software coding to managing entire business processes for overseas clients.

President Trump has targeted the manufacturing sector so far and has not mentioned anything about the IT sector so far; however, policy changes that Trump intends to undertake will have far reaching consequences on the IT offshore outsourcing sector as well. The uncertainty related to the present changes in the H-1B visa program has delayed many IT offshore outsourcing related projects as this will have an effect on companies sending their people to the offshore location for outsourcing work.

The service providers at the IT offshore outsourcing locations will have to adapt to the changing milieu, by either climbing the value chain , bringing in value added services, changing the offering to in-demand domains (e.g. analytics) and finally leveraging their experience in running Contract Centre Outsourcing at domestic locations where the client’s business operations are located.

The new proposals that are in the pipeline will lead to rising in cost for the IT service companies in the US. This problem will be solved by increasing the level of automation in the organizations.

The future IT offshore outsourcing deals should have –

a) SDE (Software defined everything) – The offshore outsourcing vendors will have to develop software that will automate the overall functioning of organizational processes. This will help companies to cut cost and also help in cloud migration. Adopting SDE will also bring in the necessary agility and efficiency in the offshore outsourcing process.

b) Coming of age of Big Data Analytics – Companies that are engaged in IT offshore outsourcing will have to be equipped to manage a large amount of heterogeneous data. IT offshore outsourcing vendors will have to revamp the entire process with the right kind of people who have industry knowledge and creative thinking capabilities.

c) RPA (Robotic Process Automation) – All future IT offshore outsourcing deal will revolve around RPA and AI and will bring about a change in the overall functioning of IT companies. Companies that are not ready to adopt this change will fall behind and lose out in the race.

The Indian IT offshore outsourcing companies have a huge base in America and companies like Infosys, Wipro has set up their plants by hiring locals in their organizations. However, the problem that these companies face is the lack of skilled resources. The companies are now thinking about new avenues where dependency on Visa will replace with some sort of unique proposition. The Indian IT Offshore Outsourcing companies will now look towards enhancing their resource with skilled individuals who are local residents of the US. In this way, any policy changes will not affect them adversely.

D2e predicts that in spite of Brexit and Trump business will remain as usual for Indian IT Offshore Outsourcing companies.