Paul Irwin Crookes*, 9^th September 2008. 

Recessions may not be bad news for everyone.  Whilst many of Britain's software organisations may now be grappling with concerns over a cooling economic climate, rising operational costs and ongoing skills resourcing pinch-points, the moment may present a great opportunity for China's emerging software development outsourcing industry to make its presence felt. To China watchers, this is not a surprise.  The country's return to the front of the world's stage by successfully hosting the 29^th Olympiad was actually just the most visible public face of what has, behind the scenes, been a major outward facing strategy for the nation's domestic industries.  Enjoying full support from national and provincial governments determined to move up the products and services value chain, China's technology growth objectives for the next decade are anchored on becoming a key player in the 21^st century's knowledge economy.  In this overall picture, the software product and services sector can be seen as a linchpin in helping to achieve these goals, through the development of high technology services, product oriented research and export driven international reach. And the benefits of all of this can be two-way.  There are some genuinely compelling messages for prospective customers to consider China in the equation: a deep human resources pool of software skilled resources, supplemented by a steady stream of enthusiastic graduates; hourly and monthly cost advantages even over Indian levels, let alone western market price points; and all of this coupled to experience in hosting overseas development centres through a credible track record in providing offshore software services over many years to both East Asian and American IT markets.   But there are still many issues to evaluate and concerns to overcome.  There are quite literally thousands of software and service firms across the country, offering to supply a myriad of different options, each with their own strengths and weaknesses.  This means either individual legwork or use of intermediary specialists to get key questions answered on vital assessment criteria, such as management team background, IP protection policies, ICT and language skills mixes, pricing structures and ODC support arrangements, to list but a few.   Nevertheless, it could be worth making the effort, as Chinese firms are serious about their intentions, are committed to making successful long-term relationships, and are enthusiastic about the opportunities they see before them.  It may be time to change the mindset about China and instead of asking "Why?", this might just be the moment to ask: "Why not?".

* Paul C. Irwin Crookes is a Senior Consultant with Cambridge-based Chinese ITO strategy specialists China Business Solutions Ltd (http://www.chinabusinesssolutions.com).  He holds a PhD from the University of Cambridge and has research interests in China's economic and technological development, and the growth of the Chinese software industry.