The latter part of year 2008 saw the doom of business environment all over the world. What started as a stagnation of the mortgage and finance industry soon took plagiarized the economy of the developed countries of the west and wrecked havoc on the world economy. As the situation stands at present, business across the globe are battling with the severe repercussions of the crisis and taking to severe cost cutting measures to survive through.

The Indian IT Outsourcing industry is no exception. Add to it the anti-outsourcing policies of the American president and the recent terrorist attacks in the financial capital of the country, and the situation becomes more austere. Industry experts predict a slowdown in new outsourcing deals and businesses and client visits, at least in the near future. However, since outsourcing is an indispensable business strategy the paradigm pitfall may not last long.

Outsourcing Destination
India has been the favorite outsourcing destination for many outsourcing countries because of the excellent services and hassle-free progression of outsourcing deals. Experts believe that India’s status as a preferred outsourcing location will remain unchanged even in the face of crisis. Although, short term impacts like a dip in the number of projects and lesser business opportunities is inevitable year 2009 will see the industry picking up pace. Overseas customer visits will increase and business turnover rate will improve with time. Clients would look to set up disaster recovery centers as an integral strategy plan.

Outsourcing Costs
As the outsourcing business stands now, the costs are bound to go up and it will remain so for the next year as well. This is because, in order to conform to a stronger disaster recovery and business continuity strategy, outsourcing service providers will have to establish centers in multiple locations and cities. This will add on to the outsourcing costs and bloat up the overall costs.

Security Measures
In view of the recent terrorist attacks, outsourcing partnerships would seek increased security measures and stricter rules and regulations. Be it disaster recovery measures or be it business continuity strategies, all of it will be included in the projects.

Recession
Employee lay-offs constitute for a crucial cost cutting measure. And what makes it ironical is the inevitability of the situation. Though there may be internal recession happening in outsourcing service providing companies in order to manage their profit margins, the work quality and deliverables would not suffer. 2009 will see more companies giving pink slips to its employees but then the situation will stabilize as soon business starts pouring in. outsourcing is an indispensable global business phenomena and even though recession period is evident worldwide, there are favorable times ahead. This is because manpower will be needed to support the demand of outsourcing services.

The short term impact may continue for a year and remain so through the year 2009. However, as global economy gets flowing again and liquid cash becomes a regular commodity, outsourcing will soar like nothing else. 2009 will be a mixed baggage!

Maneet Puri is the owner-director of LeXolution IT Services, a renowned offshore outsourcing company that offers an extensive range of KPO services like web mining, internet market research in addition to other data processing and management services.