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1 Introduction - Pg. 1

1 Introduction Welcome to the world of global sourcing. Standardized business applica tions, inexpensive bandwidth and web-based collaborative tools have opened up opportunities for less wealthy countries around the world to develop IT service industries and compete in the global market. Just as computer hardware manufacturing moved overseas in the 1970s and 1980s, the IT services industry is now migrating to countries such as India, China, the Philippines and South Africa. A wide range of business models is emerging as companies seek to exploit the benefits of offshore sourcing. UK companies may set up their own offshore IT centres or may choose to outsource to suppliers based overseas, or to European or American outsourcers who themselves have offshore subsidiaries. Gartner has described the move towards offshore sourcing as an `irreversible mega trend' (www.gartner.com). Companies are increasingly moving work overseas to cut costs and free up resources to focus on new business opportunities and innovation. Companies who fail to take advantage of the emerging global IT services industry may well lose out to those who do. Among European countries, the UK leads the way in adopting offshore sourcing. While this means that the UK's own IT sector