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India is now leading in the world for offshore outsourcing i.e. the remote servicing of information technology (IT) and other business processes India based staff.

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Downsizing is a well-known tool to cut payroll costs. Outsourcing provides a finer blade for targeted expense cuts.

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In the world of IT outsourcing, costs are not just related to the price charged for the services rendered. What are often more important, and often overlooked, are the costs clients will bear associated with managing relationships with IT services providers.

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Savvy IT outsourcing customers insist on including benchmarking clauses in their IT services contracts. Benchmarking clauses are beneficial to outsourcing customers because they allow the customer to bring in a third party to assess the competitiveness of the outsourcer’s prices.

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Most of us like to think we can drive a hard bargain, both in our personal and professional lives. And when it comes to negotiating a sophisticated, wide-ranging outsourcing contract in a time of widespread corporate cost-cutting, the ability to hammer out a good price could potentially make or break a career.

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Being one of the most popular trends in modern market, IT offshoring and software development outsourcing helps businesses to benefit from high quality services, with minimum cost and time spending, also cutting down a very large part of the project management efforts.

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While outsourcing is a powerful tool to cut costs, improve performance, and refocus on the core business, outsourcing initiatives often fall short of management’s expectations. Outsourcing failures are rarely reported because firms are reluctant to publicize them.

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Outsourcing activity continues to be constrained by difficult macroeconomic conditions, despite its potential to soften the impact of the recession through cost savings and efficiency gains, according to TPI, a sourcing data and advisory firm.

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Companies considering outsourcing are now in the driver’s seat when it comes to negotiating contracts.

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Network Services segment has been particularly strong, accounting for about half of the major outsourcing deals in 2009, research shows.

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