Table A Global Outsourcing Services (billion USD) 1999 2003 CAGR 33.2 89.7 28% CRM BPO Finance and accounting HR services Transcription BPO subtotal Content Engineering design/GIS Animation/content Content subtotal Total 90.0 3.9 5.4 99.3 144.0 12.3 10.8 167.1 12% 33% 19% 14% 6.1 6.0 12.1 144.6 10.0 30.0 40.0 13% 49% 35% 20% 296.8 Source: Adapted from Chrysalis Capital IT-Enabled Services public presentation Indian firms led the development of the outsourcing trend in IT-enabled services. Global companies such as Amazon, British Airways, Citibank, GE, Ford, McKinsey & Co., Swissair, and Bechtel became the first to outsource their CRM, BPO or content development operations to India. The IT-enabled outsourcing market was estimated at $39.6 billion in 2004. India accounted for a 43% share (including work outsourced by Indian IT firms to their subsidiaries abroad), followed by Canada (32%) and China (5%). With $1.6 billion in sales and a 16.5% share of IT exports, TCS led the pack, followed by Wipro with $1.3 billion and Infosys with $1.1. TCS also led the Indian IT industry in terms of earnings, ranking sixth in the world, with $359 million, followed by Infosys with $285 and Wipro with $230 Q1. Firms providing IT-enabled outsourcing services to clients wishing to outsource their internal operations, provided both onshore and offshore services (see video lecture for explanation). Please calculate the proportion of IT service operations conducted onshore by Indian firms in 2004 (eg, in the US where clients were located) and offshore (e.g. in India where firms took advantage of labor cost differentials with the US). Please solve as follows - First please calculate the total size of India's IT-enabled outsourcing marketsbare in 2004. A) $1.6 B B) $17.028 B C) There is insufficient data in the case D) $39.6 B E) Q2. Firms providing IT-enabled outsourcing services to clients wishing to outsource their internal operations, provided both onshore and offshore services (see video lecture for explanation). Please calculate the proportion of IT service operations conducted onshore by Indian firms in 2004 (eg, in the US where clients were located) and offshore (e.g. in India where firms took advantage of labor cost differentials with the US). Please solve as follows - In the previous question you calculated the total size (ie, both onshore and offshore) of India's IT-enabled outsourcing marketsbare in 2004. Now please calculate IT-enabled outsourcing revenues generated offshore in India. (Hint - Assume that revenues generated in India are counted as Indian exports. Assume that $1.6 Billion constitutes 16.5% of Indian exports per page 3 of the case. Thus you can now calculate 100% of Indian exports which provides a good estimate of Indian IT-enabled outsourcing revenues generated offshore in India. In other words, if 16.5% of the pie is $1.6B what is the size of the whole pie). A) $39.60 B B) $43 B C) $9.69 B D) $26.40 B Q3. Firms providing IT-enabled outsourcing services to clients wishing to outsource their internal operations, provided both onshore and offshore services (see video lecture for explanation). Please calculate the proportion of IT service operations conducted onshore by Indian firms in 2004 (eg, in the US where clients were located) and offshore (e.g. in India where firms took advantage of labor cost differentials with the US). Please solve as follows - In the previous 2 questions you calculated the total size (both onshore and offshore) of India's IT-enabled outsourcing marketsbare in 2004. And then you calculated the IT-enabled outsourcing revenues generated offshore in India. Based on these answers what proportion of IT-enabled outsourcing is conducted onshore in the US next to its clients. A) There is insufficient data in the case. B) 43% of outsourcing is done onshore in the US C) 24.47% of outsourcing is done onshore in the US D) 56.90% of outsourcing is done onshore in the US