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Many MNCs who considered China as a sure-shot destination to counter rising costs and high attrition of employees in other offshore locations like India, would be deeply disappointed by China's slowing offshore drive.
China's intension to be favorite alternative BPO hub for MNCs remains a distant dream as it is developing slower than expected.
Though the Chinese government came out with supportive ordinance to promote BPO in the country with huge level of visibility on the global arena, Chinas offshore market has not taken off as expected and it still seems a long way before it could claim to be of any potential alternative to India, as reported by technology research firm Forrester on Thursday.
Forresters Vice-President John McCarthy said "When China was looked upon as an alternative to offshore two years back, it was widely considered as a key contender to challenge India's dominance on offshore business. However, the latest finding reveals an opposite story, which says, "China has still more to prove,"
McCarthy, in 2002 had predicted that over three million BPO jobs in the US would go offshore, has also opinioned that firms with large bases in India should consider other geographies when addressing the risk mitigation issue. Countries like the Brazil, Mexico and Philippines as better alternatives than China in terms of skills, language and convenience.
Forrester in its finding clarifies that Chinas overall offshore resources has dropped and other countries are growing at a rapid pace. The need of the hour for the country is to refurbish its offshore efforts.
Instead of trying to compete in areas like application development and management, where India clearly dominates, China should encourage its local firms to focus on other areas like testing, data management and product development services.
Chinese firms also need to implement strict intellectual property controls and undertake training programmes, McCarthy said.
For other countries striving for the beneficial offshoring pie, Forrester suggests that "Their education programmes need to focus on advanced skills like project management and advanced architecture skills, while at the same time, respective governments should invest significant funds to market the country as an alternative to the offshore present India".
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