Sing and smmile exports

Offshore Software R&D is provision of software development services by an external supplier positioned in a country that is geographically remote from the client enterprise; a type of offshore outsourcing. In this context, it refers to the offshore development phase of a software. The main reason behind the companies to use offshore software development services is the higher development cost of the local service providers. The global software R&D services market as contrasted to ITO and BPO is rather young and currently is at early stages of its development, but India is leading the world in this field .

Contents

• 1 Countries involved
• 2 Offshore R&D hubs
• 3 Western dilemma
• 4 Future trends
• 5 References
• 6 See also
• 7 External links

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Countries involved

India, Ireland, Canada and Israel are the four leading countries that currently control this business, only these four countries are capable of scaling up enough to meet the demands of large-scale projects. Other offshore software development destinations include Eastern Europe (Ukraine, Belarus, Serbia, Czech Republic, Poland, Hungary), Russia, Nepal,Vietnam, Philippines, Romania, Egypt, Sri Lanka, Argentina and Bolivia.

Offshore R&D hubs

According to Gartner group’s report, global cities are categorized into Tier I, Tier II and Tier III based on numerous factors such as the quality of infrastructure, global connectivity, and availability of human capital, in order to rank the best places to set up an offshore R&D location. The report concludes that cities like Bangalore, Mumbai, New Delhi, Hyderabad, Chennai, Pune, NOIDA, Gurgaon, Thiruvananthapuram, Greater Toronto Area, Ottawa, Montreal, Haifa, Tel Aviv, Dublin, Moscow, and St. Petersburg would be the ideal places, and hence ‘Tier I’ cities to offshore R&D.

Western dilemma

Outsourcing R&D has also become a solution to some issues facing certain Western countries, especially USA and Canada, even though they have traditionally tried not to lose their technological advantage to Asia. USA and Canada are producing little more than half the reasonable number of graduates in science and technology . The solutions to these problems aren’t possible in the short term in the Western countries, as even immigration is a long and cumbersome process, therefore it is beneficial for Western countries to outsource R&D to meet these challenges.

Future trends

In 2003, a survey by Santa Clara University showed that R&D sector would be the next target of outsourcing . Hundreds of major multinational corporations have set up R&D centers in India, the list of such companies include several big names such as Oracle Corporation, Intel, Adobe, STM, SAP, IBM, and Microsoft. For a lot of these companies, their facilities in India are their largest facilities outside USA or Europe.

India’s software exports are growing by more than 30% per year.

At the same time, there is a shortage of PhD’s in India, possibly due to brain drain or because of lack of financial resources. It is estimated that very soon there could be a 25-30% gap between supply and demand of PhD’s in India.

References

1. ^ BBC NEWS | Business | Globalisation shakes the world
2. ^ BBC NEWS | Business | Globalisation shakes the world
3. ^ Offshore Outsourcing: Why Russia? - RUSSOFT & Outsourcing-Russia.Com
4. ^ Offshore Outsourcing: Why Russia? - RUSSOFT & Outsourcing-Russia.Com
5. ^ Innovation in Canada - Failing the Grade?
6. ^ Offshore Outsourcing in an Increasingly Competitive and Rapidly Changing World
7. ^ Innovation in Canada - Failing the Grade?
8. ^ United States Government, “The High-Tech Worker Shortage and U.S. Immigration Policy,” U.S. G.P.O, Supt. Of Docs., Congressional Sales Office, 1998.
9. ^ Innovation in Canada - Failing the Grade?
10. ^ InternetNews Realtime IT News – R&D the Latest Target of Silicon Valley Outsourcing
11. ^ India draws 25% of global R&D funds- Corporate Trends-News By Company-News-The Economic Times
12. ^ India software exports seen growing 32 pct in yr to March 2006 - NASSCOM - Forbes.com
13. ^ US tightens grip on Indian R&D centres
14. ^ Desi scientists help MNCs with R&D solutions- Corporate Trends-News By Company-News-The Economic Times
15. ^ India draws 25% of global R&D funds- Corporate Trends-News By Company-News-The Economic Times
16. ^ BBC News | BUSINESS | Asian exodus from Silicon Valley?

See also

• Globally Integrated Enterprise
• Offshore outsourcing

External links

• Offshoring in Argentina: from the Group “the Others” to a Position in the Option List (Source Offshore IT Guide)

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