China's software and service outsourcing industry faces some new opportunities and challenges

Absrtact: China is in the important period of rapid development of service industry, the software and service outsourcing industry faces some new opportunities and challenges. Opportunity: First, the development environment will be further optimized. In recent years, China's service outsourcing industry expanded rapidly, and initially formed a

China is in the important period of accelerating the development of service industry, the software and service outsourcing industry faces some new opportunities and challenges.

Opportunity: First, the development environment will be further optimized. In recent years, China's service outsourcing industry expanded rapidly, and initially formed a state-level service outsourcing model City as the leading industrial development system. In the future, China will pay more attention to the development of service outsourcing industry, increase the tax reduction of new industries and services through the measures of battalion reform, and strengthen the vigor of industrial development through the Reformation of Administrative examination and approval system, and the development environment of service outsourcing industry will be further optimized. Second, China's transformation from industrial economy to service economy. The service industry plays a more important role in employment than manufacturing, and the development of service industry is a key measure to guarantee employment. It is a new trend of China's economic development to vigorously develop modern service and producer services, including software and service outsourcing industry, and promote the transition from industrial economy to service economy. This will open up a broader space for the development of the software and services outsourcing industry. Third, the change of development mode expands the demand of service outsourcing. China's government departments, enterprises and institutions, social organizations and other services through the government procurement, public bidding, and other means entrusted to the Community's specialized service agencies to complete, expanding the demand for service outsourcing. Some key large enterprises began to pay attention to software outsourcing services.

Challenges: Labor costs rise, human costs have been the largest domestic service outsourcing companies, accounting for about 60% to 70% of operating income. Since the reform and opening-up, China has made full use of low-cost competitive advantage, actively to undertake international industrial transfer, in the international market has won a large number of processing trade orders, and gradually developed into a global manufacturing center, is the biggest beneficiary of globalization. However, with the improvement of China's economic development stage and the change of surplus rural labor force from the past to the limited surplus, China's labor supply and demand relationship is undergoing important changes, and China is gradually approaching or even reaching Lewis inflection point. From the historical experience of the developed countries ' economic development, it can be seen that after the Lewis inflection point of a country, because the surplus labor force has been absorbed by the industry and the service industry, it will shift from the surplus labor force to the shortage of labor, and the increase of wages makes the international competitiveness of labor-intensive industries fall, China's labor costs have accelerated over the past few years, and the current Low-cost advantage has been lost and even a certain disadvantage has emerged. India, Thailand, Vietnam and other countries not only relatively low labor costs, but also a large scale of labor, the service outsourcing industry in China will develop a certain impact. Therefore, we have to do a good job in the following areas:

One is to make full use of domestic high-end talent cost relatively low advantage. At present, China's software and other industries in the high-end talent's international competitiveness, and relatively low cost, organization and discipline strong, can take full advantage of this comparative advantage, strengthen research and development team building, play synergies, improve global delivery capacity, build sustainable service delivery advantages, on this basis to cultivate brand and influence. Second, explore new market opportunities. China's government departments, enterprises, social groups to strengthen outsourcing cooperation is the trend of the future. In addition, China's service sector management innovation is gradually deepening, especially in trade, food, transportation and other traditional service areas, modern management methods, operating organizations, service patterns, technical means are widely used, software and service outsourcing enterprises can be targeted to enhance service capabilities, and strive to obtain more orders.