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China to Overtake India in Outsourcing in 2011

Indian cities are highly ranked, while Chinese cities are on the rise and closely nipping at India’s heels, according to IDC’s new Global Delivery Index (GDI), which compares 35 cities in Asia/Pacific as potential offshore delivery centers, writes MarketingCharts.

IDC forecasts that Chinese cities will overtake Indian cities by 2011 due to massive investments (e.g., infrastructure, English language, internet connections, technical skills,) which are favorable toward offshoring.

The GDI is based on 30 criteria, such as cost of labor, cost of rent, language skills and turnover rate.

The top 10 cities in 2007 for global delivery focused more on deal-clinching factors, such as agent skills, political risk, cost of labor, and language skills, according to IDC:

IDC note on figure: Overall weighted scores take into account 30 criteria used in the evaluation. Deal-clinching factors focus only on selected criteria that are deemed the most important when evaluating a city and also have a correspondingly higher weighting attached to them.

When evaluating outsourcing, offshoring, onshoring, and nearshoring, “some factors are obviously more critical than others,” said Conrad Chang, research manager for IDC’s Asia/Pacific BPO Research. “Often times, what differentiates leading cities from the rest is their focus on deal-clinching factors, and the GDI weighs that more heavily than other factors.”