With the downturn of the global economy, many companies tend to cut expenditures in IT development. This could potentially have a huge impact on IT companies. However, according to the article Infosys Boss: Outsourcing Will Increase, Gopalakrishnan, CEO of Infosys Technologies, is optimistic about the future. Instead of cutting back the workforce, he is looking to seize new opportunities in the IT industry.
Goplakrishnan admits that the impact of the AIG bailout and Lehman's bankruptcy have hindered business and he does not see this as something the economy will overcome quickly. Many of his clients are looking to outsource more of their businesses especially to India. Total IT spending is approximately 800 billion dollars. Of the 800 billion, 250 billion comes from outsourcing, 5% of the 250 billion comes from India.
Infosys Technologies is encouraging more of its clients to implement a global delivery model (GDM). Ninety percent of business comes from within the US and Europe. Infosys hopes to expand business into healthcare and governments sectors.
Many IT companies reduce spending in R&D during periods of economic slowdown. However this company is putting more into development, specifically for IP solutions and value added services. Not only will this give them a competitive edge, it also provides jobs that may otherwise be eliminated.
Source:http://www.businessweek.com/globalbiz/content/nov2008/gb20081121_592979.htm
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Yes correct. Companies in USA and UK will try to cut costs and send their projects to Programmers and Developers in India. This will significantly result in savings.
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