Opportunities and Options for Outsourcing in China

With 20 percent of the world’s population and now the second-largest economy in the world, China is no stranger to outsourcing. The country has become both a substantial buyer and seller of outsourcing services. Enterprises operating in China are asking themselves how much outsourcing can and should be a part of their business strategies in the country.

Chinese and international outsourcing buyers confront complex decisions about the capabilities, experience and stability of providers who have a presence in China. They face an array of sourcing options, from shared services to captive and third-party outsourcing arrangements.

This ISG white paper outlines the opportunities for engaging third-party service providers — both China-heritage and non-Chinese providers. It also will describe the advantages and disadvantages of each of these provider groups. Clearly, the overall buying and selling dynamics in the emerging Chinese domestic market are still evolving, so for those interested in this country, outsourcing potential represents a promising but complicated moving target.