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India will continue to dominate KPO sector: Report
India will continue to be at the forefront of the development of knowledge process outsourcing (KPO) industry for the foreseeable future, says a report.
However, in the recent years, a number of other viable KPO sourcing hubs have emerged in the Asia-Pacific region, says a report from independent technology analyst firm Ovum.
The potential KPO delivery locations, including China, the Philippines and Sri Lanka, are unlikely to challenge India's dominant position in the market, but they have enabled many vendors to pursue a multi-shore strategy, it said.
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India will continue to dominate KPO sector: Report
Ed Thomas, Ovum analyst and author of the report, said, "Being able to deliver services from multiple locations means providers can offer existing clients greater flexibility and minimise the risks associated with having all their operations in one facility, while at the same time tapping into fresh labour pools".
The KPO industry is maturing and the range of services being provided has expanded as the market has developed. From its initial beginnings in research and analytics, the definition of KPO currently includes a variety of services, such as legal process outsourcing and clinical trial management, among others.
On the latter topic, Ed Thomas said: "A major challenge facing life sciences companies is the growing cost of R&D and, as a result, a growing number of pharma companies are turning to outsourcing and off-shoring as ways of reducing these costs.
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India will continue to dominate KPO sector: Report
China is an attractive location for companies that run and manage all phases of the clinical trial process, as it offers a significant pool of potential patients in an important emerging market".
Along with China, the Philippines is also becoming an increasingly important player in the KPO market. It has started to carve out a niche for itself in a number of key areas, including healthcare outsourcing (providing industry-specific services to hospitals and healthcare providers).
This market is expected to grow significantly during the next few years, with a notable increase in demand coming from the US as a result of the recent reforms in healthcare regulations.
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India will continue to dominate KPO sector: Report
Sri Lanka has also focused on developing skills around specific service lines.
For example, the country has a significant number of qualified accountants, capable of providing the kind of high-end complex tasks associated with service areas such as equity and credit research.
The recent emergence of countries such as China, the Philippines and Sri Lanka as viable locations for KPO delivery has been a positive development for vendors, as it has enabled them to begin offering a blend of offshore and near shore delivery while also giving them access to sizeable and previously untapped talent pools.
