Basically, the licit assenting involving an exchange of services and payments is outsourcing.  The strategic use of outside wherewithal to perform activities conventionally managed by internal staff is outsourcing. It is a proposition by which an organization contracts out major functions to specialized and efficient service providers.

Though the term “outsourcing “dates back only to early 1980s, the concept isn’t new.  In the wake of traditions set by Adam Smith’s magnum opus “Wealth of the Nations”, manufacturers had already started outsourcing the manufacture of goods to countries with cheaper labour during the industrial revolution back in the 1700s.

Companies predominantly outsource to curtail certain costs – such as “non- core” business expenses, high taxes, high energy costs and production and labour costs.  

Albeit the IT industry has existed since early 1980s in India, it was the early ‘90s which substantiated the emanation of outsourcing. The cardinal reasons behind the augmentation of the industry are the economic liberalization policies embarked upon by the government and globalization.  

According to recent surveys, around 82 of the major US companies have said that India is their first choice for outsourcing. With the development of the economy, the number is expected to rise. Illustrious entrepreneurs like Bill Gates have hailed India as an IT superpower with immense ingeniousness and competence.

Some of the considerable segments and assignments that are outsourced by most companies to India are:

• Business Process Re-engineering
• E-Commerce
• System Migration
• Maintaining Legacy Systems
• System Integration

Apart from these, other specialized jobs are also done according to the skill set and the type of output the company is looking for.