Press Trust of India Posted online: Monday, November 08, 2004 at 1210 hours IST
London, November 8: Faced with intense competition, British companies are under increasing pressure to relocate parts of their business offshore to Europe and Asia, including India, a survey indicated on Monday.
The survey conducted by Mori, an opinion pollster coincides with the start of the annual conference of the Confederation of British Industry, Britain's biggest business grouping in Birmingham, on Monday.
A total of 51 per cent of respondents said pressure to outsource abroad had risen during the last two years, while 29 per cent said the burden had increased a lot, the survey said. According to the survey, 51 per cent of businesses that have begun outsourcing have moved their operations to India, while 49 per cent have staff working in China, 24 per cent in Poland and 20 per cent in the Czech Republic.
"Offshoring is now part-and-parcel of doing business in the global economy," CBI Director General Digby Jones said adding, "make no mistake, this is a survival issue. Anyone who believes that firms have a great deal of choice are naive."
Thirty per cent of 150 business leaders surveyed said their firms had switched activities abroad in recent years, while nearly one-quarter said they were considering such a move. Of those who have begun outsourcing, 98 per cent cited cost reduction as a key reason for doing so.
The CBI said outsourcing was advantageous for British business, despite being pushed into a corner.
"Offshoring means greater productivity and more efficient goods and services. It also means UK jobs will be of higher quality, more skilled and in many cases more secure," Jones said.
"The developing world is competing with us for jobs in a way it has never been able to before," CBI president John Sunderland said. Sunderland said, “Some people fear competition and try to shut it out- that is too often the reaction in the US. There are also those that ignore it and pretend it isn’t happening, as is the case in the European Union. But business knows the only way to respond is to take the challenge head-on."
The survey showed that 73 per cent of the businesses have outsourced production and manufacturing of goods, while 29 per cent have relocated it services and 13 per cent call centres.
