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Established IT outsourcers are getting squeezed at both ends of the competitive spectrum. According to the annual offshore outsourcing survey conducted by Duke University’s Center for International Business Education and Research (CIBER) and PwC, incumbent India-based and U.S. IT service providers are under pressure from outsourcing upstarts in other countries that are stealing market share from them and from existing clients demanding price reductions.
Meanwhile, Indian and American IT outsourcing providers are entering new markets with both low-end, commoditized services—a highly competitive field with few barriers to entry—and higher-end services where market entry is more challenging, say the researchers. It all adds up to a perfect storm for many large IT outsourcers, says Arie Lewin, director of CIBER and professor of strategy and international business.
More of the CIO.com article from Stephanie Overby