"While some may argue that Europe's €2.4 billion mega deal – the Reuters/BT contract – skews the results for this first quarter, Europe still accounted for well over half (57%) of new contracts worldwide – a high point for European outsourcing."Human Resource Outsourcing (HRO) has also grown in the first quarter, with the total value of HRO contracts more than trebling to €1.37 billion, compared with only €0.44 billion in the first quarter of 2004. Almost two-fifths (38%) of business process outsourcing contracts signed so far in 2005 have been HRO, says TPI.TPI's research found that the majority of the €11 billion of major contracts awarded so far this year did not go to the "Big Six" of outsourcing – Accenture, ACS, CSC, EDS, HP and IBM – which won only 27% of the contracts."So far in 2005 a number of smaller companies have successfully challenged the Big Six, continuing the trend we saw in 2004," said Aitchison. "The growing number of service providers successfully contending for deals could indicate further competition for the Big Six and an increasing choice of suppliers for clients this year."Recent TPI research conducted among UK senior management responsible for offshoring decisions reveals that 60% see the large Indian outsourcing providers as offering a service to rival that of Western suppliers irrespective of the cost savings. TPI believes growing confidence in Indian providers could have a further impact on the Big Six.
"To date, offshore outsourcing has been good news for the Big Six. Their established presence in India has enabled them to offer clients the benefits of offshore cost savings with the 'reassurance' of working with an established provider. But, as confidence in Indian providers grows, this advantage could diminish."Elsewhere, confidence in Indian outsourcing providers was dented by the news that three former employees of Indian outsourcing firm Mphasis had been arrested for allegedly stealing £170,000 from US customer accounts with Citibank.According to reports the three used their call centre positions to trick customers into giving them their pin numbers.Nasscom, India's National Association of Software and Service Companies, acted swiftly to reassure clients and account holders, announcing plans to create a national database for the registration of call centre staff holding security clearance.
