Archive for January 22nd, 2007

Cost of setting up Development Centre India

for a small IT company(less than 20 employees) cost per seat generally terms out to INR 25,000 per seat per month. this includes the risk metrics and operational cost (as per existing rental values/admin expenses calculated on outsourced operational values)

Foran american company looking at starting operations in India they should look at cost of USD 1500 per seat/per month. This is essential keeping in mind learning curve they will need to implement and risk for around 18 months for delivery channel to be self sustainable.  If they wish to cut down on inital training etc and would like people to straight away jump into projects thrown at them. They are looking at cost between USD 2000-2500 per seat/per month depending on a contral spanning 24-26 months.

Companies should do take a note india is no more cheap source of manpower but a place to find good minds at competetive cost.

SaS – Software as Service the next frontier for Indian IT companies

Lately have been trying to study how can the outsourcing model evolve further. In terms with companies of all sizes fighting in this space how can one transform their business model to be more innovative to keep increasing the profit margin rather than fighting on lower cost end.

One way which all IT companies agree is by developing a product and running after a vertical.¬† Though the next phase of problem it brings is ability to support the product on site. Now by creating infrastructure on shore near a customer is an expensive bet and hurts company’s bottom line in long term due to the fact you are trying to project maintainance cost will go down by shifting to new application developed by you. So what is the alternative and how to enter this space.

Answer !!!! – SaS – Software as Service

With web-services becoming  standard of operation between disperse set of applications it becomes sense for companies to delivery products on demand to organizations.Advantages of such implementation are tremendous

– Being in controlled hosting enviornment service can be easily manage and maintainance can be provided from an offshore location.

– Single Update to a component gets easily delivered to all customers.

– Ability to cut down cost of product by managing multiple clients with help of same infrastructure/team.

Domains of implementation HR/Sales/SCM/CRM

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January 2007