A recent study conducted by Zinnov on Software R&D globalization revealed that only 5% of this R&D spend is currently being spent on outsourced partnerships, which means about 95% of the R&D is made by companies in-house. This presents a tremendous growth opportunity for companies providing Outsourced Product Development services.
We attended the webinar on 'Globalization Opportunities in Software Development for Enterprises and ISVs' where Zinnov experts shared further research results.
Vamsee Tirukkala, Co-Founder & Managing Principal, Zinnov, commented on the trend that companies leverage 3rd party global centers mainly for cost savings and access to relevant talent. 83% of the audience confirmed the increasing importance of OPD by answering affirmatively to one of the audience poll’s questions (“Are companies increasingly looking at OPD service providers for global RnD and product development?”).
With a freeze on spending in the face of recession and plans to optimize on investments made over the past 12 months, companies need to rapidly evolve and transform their emerging location centers to increase their innovation capabilities.
Mr. Tirukkala also advised software producers to rapidly their OPD partnerships to the next level with more engineering and product leadership and strategic responsibility. Another audience poll showed that customers consider China and Eastern Europe to be the next most attractive locations for R&D investment, following India that leads in resource volumes, while Eastern Europe is a hot spot of software engineering talent.
Globalization opportunities for enterprises and ISVs seem bright, according to Zinnov, with several small and medium sized companies beginning to work directly with 3rd party providers. “A huge trend we are seeing in the industry in the last 18 months is what we call as the 'go to market' strategy. It’s what vendor partners can bring to the table. If you are a partner in a well-known reputed company, they have the capability to take your product to multiple markets," commented Mr. Tirukkala.
The new pricing models (outcome based pricing, revenue share pricing and risk reward pricing) offered by vendors to clients are adding to the attractiveness of partnerships, he said.
Source: Global Services
We attended the webinar on 'Globalization Opportunities in Software Development for Enterprises and ISVs' where Zinnov experts shared further research results.
Vamsee Tirukkala, Co-Founder & Managing Principal, Zinnov, commented on the trend that companies leverage 3rd party global centers mainly for cost savings and access to relevant talent. 83% of the audience confirmed the increasing importance of OPD by answering affirmatively to one of the audience poll’s questions (“Are companies increasingly looking at OPD service providers for global RnD and product development?”).
With a freeze on spending in the face of recession and plans to optimize on investments made over the past 12 months, companies need to rapidly evolve and transform their emerging location centers to increase their innovation capabilities.
Mr. Tirukkala also advised software producers to rapidly their OPD partnerships to the next level with more engineering and product leadership and strategic responsibility. Another audience poll showed that customers consider China and Eastern Europe to be the next most attractive locations for R&D investment, following India that leads in resource volumes, while Eastern Europe is a hot spot of software engineering talent.
Globalization opportunities for enterprises and ISVs seem bright, according to Zinnov, with several small and medium sized companies beginning to work directly with 3rd party providers. “A huge trend we are seeing in the industry in the last 18 months is what we call as the 'go to market' strategy. It’s what vendor partners can bring to the table. If you are a partner in a well-known reputed company, they have the capability to take your product to multiple markets," commented Mr. Tirukkala.
The new pricing models (outcome based pricing, revenue share pricing and risk reward pricing) offered by vendors to clients are adding to the attractiveness of partnerships, he said.
Source: Global Services
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