How has 2007 gone?

Even though we're not quite at the end of 2007, I thought now would be a good time, before people start heading off for their holidays, to revisit my predictions from early this year.

The first part of those predictions related to countries as consumers of sourcing services.

• Certainly the prediction that Australia and New Zealand would continue to see significant business volume has held true, with this year potentially signifying the end of the boom-bust cycle across the region.
• Likewise, the predictions that India would continue as a buyer of sourcing services whereas Korea would stay quiet, also align with market data.


• The question about whether Japan would see an increase in the number of new sourcing arrangements was well placed as the data suggests this did not happen again this year.


• However, the suggestion that we would see increased activity across Singapore, Malaysia, Thailand and the Philippines, has not been borne out by the market data.


• China has been a bit of surprise with a mega deal inked this year, which might herald its emergence as a market for sourcing deals earlier than expected--but, next year will be the real test.

Regarding the second part of the predictions, related to increased competition among countries bidding to be offshore destinations...

• The prediction that India would continue as the major offshore destination, and that China would attract more attention than actual work, were unsurprisingly true.


• Likewise, the emergence of Vietnam was quite evident throughout the year.


• However, Malaysia, Thailand and the Philippines--while continuing to attract additional business--did not attract the expected business volume and diversity.


• In terms of promotion, Singapore, Australia and New Zealand continued to push into niche markets, but their efforts at gaining attention were often lost in the India-China focus.

The third part was about increased diversity of client maturity and expectations. This has certainly become obvious this year with quite a range of demands being seen, ranging from complex multi-sourcing arrangements that will challenge the most experienced clients and service providers in terms of management, through to first-time sourcing clients who are just coming to grips with acquiring services, as opposed to simple labour inputs, externally.

So, all up, not a bad effort for predictions. We'll have to see if I can do as well in 2008.

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Michael Rehkopf

Michael has more than 20 years of experience in operations, strategy and sourcing covering all major parts of the globe. He has also worked for Australian, Canadian, German and Japanese companies in both business process outsourcing and IT outsourcing.
Michael's industry experience includes the financial services, manufacturing, telecommunications and travel sectors. He leverages this diverse industry experience and his university background in accounting, IT and his Master of Dispute Resolution, to assist clients in the development of business strategies and the implementation of sourcing strategies. These include the associated evaluation, negotiation and organizational change.
Michael is currently a partner at TPI, the world's oldest and largest sourcing advisory firm. Prior to joining TPI, Michael held leadership positions with Siemens Business Services, OpenPlus International, Mitsubishi Electric and Netron.