Outsourcing service providers are taking steps to diversify service offerings to stay competitive, according to new research from The Center for International Business Education and Research’s (CIBER) Offshoring Research Network (ORN) at Duke University’s Fuqua School of Business and PwC US. The third annual survey of providers of offshore labor is part of ongoing research into the effects of offshoring trends on the economy and reflects changes in the provision and consumption of global sourcing in recent years.

PwC and Duke surveyed of 620 service providers at 1,850 companies from more than 50 countries and found that a shift in the outsourcing industry is affecting incumbent India-based and U.S. firms. These are caught in a “perfect storm” in which new outsourcing competitors are entering new markets to offer both low-end, commoditized services with few market-entry barriers, and high-end, value-added services that drive higher margins where market entry is more challenging.

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