E-learning offshoring- Is India losing the edge?

The leading global management consultancy, AT Kearney has recently released its ranking of top outsourcing destinations from a study conducted with top 50 countries and the good news is that India still remains to be the favorite outsourcing destination despite recession.

This news holds good for e-learning as well. International countries prefer India to outsource their e-learning requirements over its competitors China and South Africa.

What’s India’s share in this e-learning outsourcing pie? What makes it a lucrative offshore destination for e-learning over its global counterparts?

The Indian e-learning outsourcing industry comprises of third-party service providers and offshore delivery centers of international e-learning providers and consulting firms.

ValueNotes Research report indicates that the revenue from the e-learning offshoring industry is approximately $341 million at the end of the year 2008. The economic recession across the world will have an impact on the growth of the industry for the next 6-8 quarters and the market will regain and flourish much faster until 2012. They also estimate that the e-learning offshoring will grow at a CAGR of 15% until CY12. With this growth rate, the revenues from e-learning offshoring industry will touch $603 million by 2012.

There are several reasons which have placed India in this advantageous position. India has a large pool of English speakers. English in India is a legacy left behind by British who colonized in the country and according to information by Encyclopedia Britannica Book of the Year 1995, among the population who do not speak English as their mother tongue, India ranks third (30 million) in the world after US and Philippines. It’s not only the language competency, but also the vast pool of graduates in almost all sectors that makes India develop e-learning for all verticals that includes manufacturing industries, universities, IT companies, healthcare, pharma, financial services, management sectors, legal sectors and so on. Apart from these, the important factor is the cost advantage India offers for the quality labor. With economic recession curbing the training budget of companies in the West, they find outsourcing e-learning to countries like India as the best option to up skill their workforce within budget, and the US companies directly approach Indian companies to outsource e-learning.

With global giants like IBM, TATA Interactive Systems, NIIT Technologies in the market, India has proven its capability to take large volumes of e-learning projects. China, Singapore, Malaysia, Philippines, Brazil, South Africa, and Ireland are the other countries that offer e-learning services. But with the overall advantage of skilled resources, maturity of companies in handling large projects, cost advantage, and flexibility in handling the projects for international markets, India excels these countries and is the favorite e-learning offshore destination. For Indian service providers the primary client market is in the US, followed by the UK, the rest of Europe, and the Asia-pacific region.

India is definitely in an attractive position now, but the other countries are following with narrow gap. China also offers labor at reduced cost and the growth of technology is at a faster rate. Also countries such as Singapore and South Africa have skilled labor force. These countries seem to be a threat to India and clearly indicate that India should move forward from work-as-per–instructions model to more of an R&D approach in devising and designing new learning solutions.