Process in place

Employees in developing countries are now writing specific software programs for US or European companies, and in most cases serving as their back offices. The availability of a global supply chain has made it easier for companies to undertake virtually any project, any time and anywhere. According to the International Association Outsourcing Professionals (IAOP), outsourcing a business process helps companies to reduce 9 percent of their production costs, and allow them to focus on their core competencies. It will also make a 15 percent improvement in the company's capability and quality.

The global BPO market, an umbrella concept that covers call centers, data entry of bills, prescriptions and traffic tickets at its lower spectrum to a higher end of managing human resources operations, is valued at some $40 billion (28.4 billion euros), according to Everest Group, a marketing research firm.

Gartner reports estimate that global IT services revenue touched $793 billion in 2010. Both these markets are expected to record double-digit growth in the next few years.

Unlike its better-known BPO rival India, China aims to position itself as the destination for large-scale offshore BPO and Internet technology outsourcing (ITO) services.

In 2006, Gartner described China's capability to serve Western enterprises as "in its infancy" and to be treated with caution. India continued to dominate the global BPO landscape then even as China registered only $2 billion of revenue from outsourcing.

That has indeed changed over the years. According to the ministry, the outsourced-services market in China will cross 1 trillion yuan by 2015.

In February 2009, China identified 20 cities as the trial grounds for outsourced business. Beijing, Tianjin, Shanghai, Chongqing, Dalian, Shenzhen, Guangzhou, Wuhan, Harbin, Chengdu, Nanjing, Xi'an, Jinan, Hangzhou, Hefei, Nanchang, Changsha, Daqing, Suzhou and Wuxi were the cities in the initial list. Xiamen was added to the list last year and currently the industry is spread across the 21 cities.