Small companies are sophisticated users of web-based collaboration technologies and prefer specialized small providers.

Now, members of senior management are expressing a growing interest in existing offshoring initiatives and future opportunities in a variety of areas, including engineering, software development, marketing and sales and procurement.

Ton Heijmen, senior advisor for outsourcing and offshoring at The Conference Board, and one of the report's authors, said that companies that have implemented a corporate-wide offshoring strategy often report significantly better performance.

Such companies often have improvements in cost savings, meeting target service levels, improving relations with providers and overcoming internal resistance, he said.

'Outsourcing innovation in engineering, research and development, product and software development, and knowledge processes makes companies, whatever their country of origin, more competitive by increasing speed to market and compensating for domestic talent gaps,' Heijmen said.

(Arun Kumar can be contacted at arun.kumar@ians.in)