Impact sourcing in India: Trends and implications

Abstract

This paper focuses on impact sourcing, which refers to a type of business process outsourcing activity whereby service providers elect to provide high quality, information‐based services to clients by purposefully employing youth from low‐income communities to carry out simple data handling tasks. Whilst this activity proliferated across countries in Africa, Asia, and Latin America from 2010 providing jobs and skills to many individuals, its growth seems to have been constrained in recent years. In order to explain this phenomenon, we undertake a longitudinal study of impact sourcing based on the case of Karnataka, which has been a prominent player in this sector since 2008. We commence by describing the operations of three impact‐sourcing enterprises in the state and locate this activity within the broader scope of state government policy focusing on two key aspects. First, we assess the adequacy of state support for rural entrepreneurs to sustain their operations for client companies and, second, whether there has been sufficient policy focus on ameliorating the socio‐economic context within which impact‐sourcing activity takes place. Finally, we reflect on important implications of our findings for further research on impact sourcing in the field of information systems and for policy prescriptions in order to create a conducive environment for this socially focused business activity to thrive.