Large organizations are now used to outsource all their IT needs to an integrated IT service providers. The conventional success trick of "Outsource non-core and Focus on core" is now a commodity statement and giants like Accenture, EDS and IBM have grown dramatically as a result of this trend but something else is going on in China which is changing the outsourcing scene little by little.

The reason lies in the relative portability of IT services compared to 10 years ago. Now that companies find it easier to switch to companies in India and Singapore so why shouldn't they? And as a result many European and American service providers find their high-value contracts broken pretty easily.

Logical Conclusion: In order to survive against the wave of Asian outsourcing services, Innovation is the key. Cost is not the only motivation for outsourcing; companies will also need innovation in the processes and enhanced learning. This is usually possible through high investment in new technologies and R&D and that's what established service providers should give their clients.

If this can be done, I myself don't think that the Asian companies can capture more than half of the market in the long run. What is your point of view?

P.S. I got the cool photo above from Mayforth website.