Service Outsourcing Industry Promotes Open Innovation

Accompanying with the proceeding of a new round of international industry transfer whose main form is service outsourcing, the global service outsourcing market continues to expand. China is an important undertaking place of service outsourcing, all Chinese governments pay full attentions and give enough supports to service outsourcing industry development, in order to grasp the good opportunity to develop service outsourcing industry and upgrade industry level. Under the environment of actively promoting outsourcing service industry development, Shanghai has taken the forefront of China relying on its good foundation for industrial development.

Service Outsourcing Promotes Open Innovation

Recently, there is one bias about the service outsourcing and innovation, it believes that service outsourcing is a low-end labor-intensive service (such as software coding, document processing, etc), it has no own intellectual property, no good for the enterprise innovation, cannot make the enterprise have the real core competitiveness, this viewpoint is wrong because it knows less about the increasingly rich situation and future of service outsourcing. The service outsourcing has its own unique characteristics, it is the excellent soil for enterprises to achieve innovation, and service outsourcing is gradually promoting a new round of open innovation.

With the impact of globalization, the competition is increasingly intense, the margin is declining, and the R&D cost is dramatically increasing. The traditional situation that some large enterprises lead the R&D to innovate has broken gradually, many enterprises are beginning to face to the R&D budget pressure when committing to basic research and concerning applied research, so the open innovation emerges. Chesbrough stated in Open Innovation, "The closed innovation is always the enterprise's own independent innovation, but the open innovation needs the enterprise to inosculate the external ideas and knowledge to innovate."

Open innovation is firstly created cooperatively and jointly by different units of an enterprise, secondly is the cooperation between enterprises and partners. Open innovation concentrates and shares the R&D resources and strength, develops more cooperation between public divisions and private institutions, explores more forms of sharing intellectual property rights or intellectual property licensing, open innovation means higher speed, lower costs and better long-term competitiveness.

The bilateral knowledge transfer of service outsourcing do can promote enterprise open innovation development based on the characteristic of getting high-quality service with more reasonable cost and happening to have the same views with the requirement of open innovation. The innovation of service outsourcing will not only be technical innovation, but also include market innovation, management innovation, mechanism innovation, brand innovation, serving form innovation, etc. Analyze deeply the differences of domestic and international market demands, actively implement "International Planning, Localized Implementation" innovation development, product and service models.

Service outsourcing enterprises are in the competitive market; it undertakes and completes the outsourcing process and also the sharing the experience of technical knowledge, management systems, process control, etc. These have laid a good foundation for the bilateral enterprises in the outsourcing relationship.

With the growing maturity of the industry chain, the business forms of outsourcing services are also rich continuously, in the high-end ITO and BPO, those outsourcing business forms have emerged, such as design, R&D, consulting, etc. Service outsourcing has begun to promote the enterprise open innovation.

In the field of automotive industry, Zhonghua and Hafei retain the foreign design companies to develop the type as the form of design outsourcing, Companies, such as Chang'an, Jianghuai, Zhongshun and etc, invest to set up multinational research institutions to proceed with the global synchronous development. Now, these enterprises have all upgrade quickly their own innovation and technology competitiveness by the full use of global superior resources.

Industry Needs Standardization

Services outsourcing is a new industry in China, and the developing time is comparatively short, it hasn't formed a common industry standard. Under the increasingly competition of the global services outsourcing market, the outsourcing parties pay more attention to the quality, stability, innovation and standard of the outsourcing services, the services suppliers also need to adopt a high-level standard to improve the management, standardize the processes and reduce the risks.

Currently, the implementations of various organizations are fragmented rules or statutes which haven't been arranged, each outsourcing enterprise has its own norm and standard, this has seriously constrained the development of information services outsourcing industry. In order to develop the information services outsourcing industry orderly and arrange the services outsourcing market from the source, we need to strengthen the related norms and standards of outsourcing enterprises, outsourcing practitioners, outsourcing project management, the related protection of intellectual property, credit construction, etc.

To constitute our services outsourcing standards, firstly, we need to search deeply the internationally existed services outsourcing standards, the related industry management, technical standards and services norms to learn from their advantages; secondly, we need to focus on the technical requirements and quality demands of the services outsourcing parties on the outsourcing businesses; finally, we need to combine with the situation of Chinese services outsourcing industry development, to strengthen, standardize and unity aiming at the inadequacies of the local services outsourcing enterprises undertaking businesses. The establishment of the standards can bring a series of promoting effects to the industry.

Compared with the foreign enterprises, the local services outsourcing enterprises have the gap on management, processes, technology, quality of services and other aspects. Following the introduction of the standards, the affection of criterion and guide will help the services providers improve the management, optimize the services process, improve services quality and increase the successful rate of cooperation. Meanwhile, it can help the services outsourcing suppliers reduce the risk of losing control of the outsourcing project quality management, the deficiencies of knowing the potential risks in the future, the situations failing to reach the contract standards. At the same time, the establishment of services outsourcing standards is the key measure to accelerate undertaking offshore outsourcing businesses. Enterprise users can evaluate and choose information services outsourcing suppliers according to the standard requirements in order to lower the transaction costs, supervise and manage the outsourcing supplier better.

In addition, the establishment of services outsourcing standard can promote the protection of intellectual property, training, reserve, selection and appointment of talents, and give the auxiliary force to develop the industry. Through the implementation of standards, services outsourcing enterprises can achieve standardized project management, save the costs from the internal management, and connect with the international services outsourcing standards gradually to reduce the cost of accessing packet. The enterprise users also can evaluate and choose information services outsourcing suppliers expediently, besides, supervise and manage the information services outsourcing suppliers better, which reduces the transaction costs greatly.

Every standardized implementation of outsourcing projects can further clarify the industry chain's constitution and distribution in the project, it makes the involved teams find fixed and different developing directions, so it is useful for Chinese services outsourcing enterprises to develop collectively, expand scale, set up independent brand to get bigger and more technical content orders.

Therefore, the government departments should consider two ways to strengthen the services outsourcing in the standard-setting:

First, the government divisions and intermediary agencies should strengthen the basic research of standards. Establish and improve the standard system of services outsourcing, including corporate governance standards, project management standards, services outsourcing contract models, outsourcing services personnel identified standards, intellectual property management services outsourcing norms, building services outsourcing business credit norms, services outsourcing project management platform technology standards. The establishment and promotion of services outsourcing standards can help the services outsourcing enterprises standardize management, improve processes, create brands, and put the business into the global services outsourcing industry chain; it is also benefit for managing and supervising services outsourcing projects, training and attracting the best services outsourcing talents, and the certifications of intellectual property protection, credit contribution and services outsourcing enterprise aptitude.

Second, enterprises gradually enter into the standard-setting work. Enterprises strengthen research and development, focus on developing and establishing the standards with independent intellectual property rights during the practice, and they set up a patent pool so as to enhance their competitiveness and protect their legitimate rights, then keep their competitive edges.