Global Sourcing: Shifting the Focus from Cost Saving to a Strategic Set-up

Abstract

The common understanding of global sourcing as a procurement centric task of companies to resolve shortage of talents in the context of established offshoring and outsourcing models will be reviewed for product sourcing and service sourcing separately. Understanding offshoring as a location-specific delivery model and outsourcing, on the other hand, having significant impact on the governance, delivery system and the companies’ organisation (onsite or offshore), global sourcing is seen as a combination of both. Discussing various offshoring and outsourcing failures at the beginning of the twenty-first century has impact on future global sourcing strategies. As a result, we will introduce the concept of “outsourcing of global sourcing” as part of a service provider’s delivery model. Indian service providers have developed a unique system of education, processes and tool-based delivery systems which are mostly standardised across the industry. High attrition in the industry requires a focus on knowledge retention rather than people retention. This attrition and rotation of highly skilled and experienced talents enables small start-ups now to inherit the principles and processes of the big ones and implement global sourcing as business model for SMEs worldwide. This gives once again India a competitive advantage in the professional services market.