Outsourcing Industry reaches the maturity curve

I am not sure whether the services offshoring industry, which is relatively young, has reached the maturity curve.

But, yes, there is an increasing interest in outsourcing advisory firms, especially from the companies who would like to rely on an external help instead of nurturing inhouse teams of outsourcing professionals.

This interest is also showing up in terms of companies who would like to enter the advisory business space through an inorganic route.

PR Newswire reported yesterday that,
"Information Services Group, Inc. (ISG) announced today that it has signed a definitive agreement to acquire TPI, the largest independent sourcing advisory firm in the world focusing on the design, implementation and management of sourcing strategies for major corporate clients.

Under the agreement, ISG will acquire TPI for $280 million in cash. TPI's founder and members of management will invest 30 percent of their proceeds from the transaction in ISG stock at closing. In addition, ISG intends to repurchase up to $40 million of its common stock and/or warrants after closing. The acquisition is subject to customary regulatory and ISG shareholder approvals and is expected to be concluded in the fourth quarter of 2007.

Founded in 1989 and privately held, TPI created the market for fact-based advisory services, guiding large enterprises through their realignment of support functions".

The maturity is yet to be reached. I think the sign would be more companies opting for strategic outsourcing partnership. Today the price tag is still the major concern in SMB sector, companies look for quick ROI. I think maybe a certain phase has been reached, no more