Offshore outsourcing to India is especially buoyant. Only last month Norwich Union, Britain's biggest insurance company, joined a host of other firms including HSBC, Barclays, Marks & Spencer and Tesco, by deciding to ship jobs to Asia . But some, including the Royal Bank of Scotland and Alliance & Leicester, have pledged to keep jobs in Britain , partly in response to the backlash that turned offshoring into a political hot potato.

With the growing fashion of the world’s biggest organizations to offshore outsource their business processes, India has emerged as the world’s leader in outsourcing industry. Although it is the most preferred destination for most of the business organizations, mainly because of being the second nation in the world to have highest English speaking population and other factors like the cheap technically skilled labor, still it looses one out of every five clients because of the country’s inability to win its client trust over security and privacy issues.

Let’s have a look at the reasons that have forced companies to pack their bags and return to their homes by compromising over their profits.

1. Even though India is through with its first cyber law, the IT Act 2000, the service providers have been unable to provide satisfactory standard security solutions because regulations, legislation, and consequently risk vary vastly between industries and geographies.

2. Apart from this the companies bear a distrust feeling due to the lack of regulatory protection in areas such as security and privacy. It is because the IT Act 2000 doesnot include any clause similar to the Data Protection Act of United Kingdoms. This naturally has lead companies to decide for their home than to outsource.

3. India till date, has not been able to achieve the recognition from European Commission, which has framed certain standards covering data protection compliance in contracts with offshore suppliers. It is because India has not been able to rise up to the laid standards. But this not the end, the country is working hard to frame up a data protection act and privacy regime that will be scrutinized by the EC in due course.

4. The extremely slow India ’s legal process in checking digital piracy which includes both, software and movies, is also one of the reasons why companies hesitate to outsource their business processes to India .
Developed nations like Hong-Kong and Singapore , on the other hand, have stringent laws for the similar crimes.

5. Further the case of an ex-employee of Geometric Software Solutions Ltd (GSSL), a Mumbai service provider, who was caught red-handed for trying to sell the source code of Solid Works, its U.S. buyer, to another U.S. based company, has brought down the country’s image in outsourcing market. Also, Companies have identified major viruses, spam and employee misconduct as the key concerns in India . With more of such cases coming into the public notice and the continual of virus problems, the business organizations prefer to scrutinize the country’s data security readiness before hand than to outsource blindly.

If it is all to influence your business policies while outsourcing to India and lets you decide to sit and relax at home with the feeling of being safe and secure with your business processes…you need to think again because there is other side of India too that has taken it to the world’s top position in outsourcing market.
The year saw high profile visits of CEOs of Microsoft and Intel, who have high stakes in India . Microsoft CEO Steve Ballmer inaugurated a new campus facility of the company in Hyderabad and said the firm would hire hundreds in India and bring out MS Window in 14 Indian languages .

1. To hold their clients, most of the Indian Service providers agree to be subjected by global acts and ready to be litigated in the court of the user’s country .

2. Also, to stay in the competition and ensure security and integrity of the data, most of the leading business process outsourcing companies have implemented international standards for information security management like the BS7799 and the ISO17799. These security safeguards are ensured in many ways like:

a) Before appointing an employee, his/her background is checked.
b) The employees donot have access to internet so as to avoid Trojan horses infecting systems and monitoring data.

c) No pencils or mobile phones are permitted in the processing shop so as to prevent the incident of the data being copied.
d) The machine gets locked in a minute, if it is left idle.
e) Systems are protected by multiple-level firewalls, anti-virus and encryption software and there is a reporting mechanism in place for any violations.

Thus it can be confidently said that Indian companies follow a whole chapter on compliance while providing their services.

3. The outsourcing environment is becoming increasingly control-oriented and the need for stronger cyber laws has been increasingly felt. The government too realizes this and therefore promises to have a tighter data protection and privacy regime in place later this year. It is conducting a security audit of its 860 members and has proposed to amend the existing cyber laws of India , the IT Act 2000 so as to cover up the issues of data security and cyber crime.

4. Apart from this, the Government of India has introduced various policy concessions and initiatives to accelerate the growth of the IT-enabled outsourcing market so as to ensure that India evolves as the global hub for IT enabled outsourcing in future.

Thus it can be reputed that India is working real hard to maintain the standards in all regimes whether it is to frame up and enforce laws like Data Protection law or maintain privacy and security standards in the Business Process Organizations, all at the lowest cost offered by any other country in the world without making its clients comprise over the quality and technicality of the work; and this is what has been shown up in the results too. As per the estimates, India is poised to become a No. 1 BPO destination in the Asia-Pacific overwhelming all the so called odds .

This entry was posted on Sunday, September 9th, 2007 at 4:57 am and is filed under Indian Industry.