An average of 41 percent of new development activity is now outsourced, according to META Group, Inc. Last year, the average percentage of new development from outsourcing providers and external contractors was 35.9 percent worldwide. Despite political instabilities in India and other parts of the world, more and more companies realize the strategic and financial advantages to using offshore resources for both programming and business processes, according to new findings from META Group's upcoming 2004 Worldwide IT Benchmark Report, which looks at IT trends in various industries across the globe.

"IT budget cutbacks have left IT managers little choice but to outsource if they are to get their development projects completed," says META Group executive vice president Dr. Howard Rubin. "IT organizations often use external resources – such as consultants, contractors, packaged solutions, and outsourcing providers – to augment and sometimes replace internal resources. Going offshore and using the economics of offshore outsourcing have been the only competitive options left for larger companies since all the IT budget decreases of 2000, 2001, 2002 and even 2003."

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