Accenture Leads Continuing Offshore Boom

The firm recently reported that in the first three quarters of this fiscal year, outsourcing net revenues increased 17 percent compared with the sa...
Stephen TaubJuly 8, 2005

Consulting and outsourcing company Accenture announced that it plans to hire between 30,000 and 50,000 new employees in China, India, and the Philippines during the next three years so it can increase the amount of software development and other work done offshore, according to published reports.

Accenture currently employs 19,000 people in its outsourcing operation in those countries, plus another 10,000 elsewhere, out of a total workforce of about 115,000, according to the Financial Times.

The hiring plans should be little surprise. After all, Accenture recently reported that in the first three quarters of this fiscal year, outsourcing net revenues were $4.44 billion, an increase of 17 percent compared with the same period last year.

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Goldman Sachs analyst Gregory Gould told Reuters that Accenture’s just-announced plan is 10,000 to 15,000 above its previous forecast. Gould believes that the new employees could boost the firm’s annual revenue by another $300 million to $400 million.

Accenture employs about 11,000 people in India, noted Reuters, and it will increase hiring in China, considered a more convenient location for serving clients in Japan.

“Accenture will use this workforce to pursue more applications maintenance and outsourcing work,” Gould said in a research note, according to the wire service. “So it will begin to compete more directly with the offshore pure plays.”

Accenture’s announcement comes a week after IBM Corp. revealed plans to add 14,000 jobs in India after cutting 13,000 jobs in Europe and the United States, according to The New York Times.

Meanwhile, IBM recently launched a business transformation outsourcing center in Brisbane, reported Computerworld Australia. The operation is primarily intended to lure Japanese and Asia-Pacific outsourcing funds into Australia, the paper added. According to the report, business process outsourcing in Australia is expected to grow more than 28 percent by 2008.