The perspectives and practices of business process outsourcing in Indian industries: a survey and analysis

Outsourcing has become a common terminology among the industries, which has provided a thrust in achieving the organisational goals. Organisations are narrowing the range of processes and functions they perform internally, and today's business environment relies substantially on third party business and service providers. This trend is very much on the increase in India. A survey of the Indian industries was carried out to get an insight into the level of maturity of the companies as far as outsourcing is concerned. The survey covered issues related to various facets of outsourcing including the functions outsourced, reasons for outsourcing, benefits obtained, problems faced and criteria for vendor selection. The response obtained from more than 100 participants drawn from various sectors, including manufacturing, information technology and service, was subjected to preliminary analysis and multivariate statistical test such as factor analysis. The results of these analyses provide significant insight into the perspectives and practices of business process outsourcing (BPO) in Indian industries, especially in terms of the relationships that seem to exist among different functions outsourced, criteria for preference among the vendors, levels of advantages offered by BPO and the degree of problems faced by outsourcing organisations. The results also provide a good base to develop an effective decision support system. The details of the survey, the analysis and the key learning points are presented in this paper.