Offshoring fails to keep the customer satisfied

Companies that outsource their IT operations to offshore locations are increasingly dissatisfied with the service they are getting.

The annual offshore outsourcing survey from consulting firm DiamondCluster International shows that the number of outsourcing buyers satisfied with their offshoring providers has fallen from 79% to 62% over the year.

The number of organisations prematurely terminating an outsourcing contract has doubled to more than 50%. 

DiamondCluster said the increasing dissatisfaction could not be purely blamed on offshoring providers.

Many purchasing organisations still did not have the means to accurately gauging the success of their outsourcing strategies, although many are years into some contracts, it said.

India remains one of the most popular offshoring destinations, although 40% of the respondents expected to use China for some IT functions over the next three to five years, up from 8% last year.

The survey was based on discussions with more than 200 senior IT executives at global 1,000 companies, and interviews with 240 senior executives at outsourcing providers.

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