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We normally associate IT outsourcing mainly to India in places like Bangalore. However,with the passage of time,higher labor costs and turnover rates made companies also look at elsewhere to get their outsourcing needs.
A list compiled by management consulting firm neoIT on the new outsourcing hubs which are based on the following criteria:
- availability and skill of workers,
- cost competitiveness,
- quality of the local infrastructure such as transportation,and the risks of doing business in each city
Take note that the cities are listed alphabetically,as there is no ranking.
| 1 | Buenos Aires,Argentina | Open-source technologies | Accenture EDS Stefanini IT Solution | Big IT investment in the 1990s was followed by the devaluation of the peso in 2002,driving the need for IT workers to use open-source,or freely available,software |
| 2 | Bucharest,Romania | Security systems development and software testing | Genpact Wipro Infosys Accenture | A high availability of qualified personnel and the city’s proximity to Western Europe make it attractive. Even better,prices are 40%-50% lower than in Western Europe. |
| 3 | Dalian China | Application development | Genpact Accenture IBM Global Services | Dalian has a high availability of workers who are proficient in medium-level IT activities. Proximity to Japan and workers who are fluent in Japanese make it appealing to Japanese companies |
| 4 | Ho Chi Minh City,Vietnam | Low to medium level application maintenance and technology support | Glass Egg Digital Media TMA Solutions First Consulting Group FPT Software | Labor is cheap here,costing even less than in India,and workers are adept at performing labor-intensive IT support services. |
| 5 | Moscow | High end software R&D;development of embedded software,or programs that reside within a specific device | IBM Global Services Luxoft EPAM | There’s an availability of highly qualified engineering talent,specializing in R&D and high-end product development |
| 6 | Mexico City | Custom application development | EDS Stefanini IT Solutions | Having the same time zone as parts of the U.S. and fairly good availability of skilled labor make the Mexican capital a good place for software projects that require extensive collaboration with U.S.-based teams. |
| 7 | Prague,Czech Republic | IT systems management services | Accenture EDS | Prague’s good infrastructure and proximity to Western Europe make it a good place for companies that want easy access to outsourcing providers |
| 8 | St.Petersburg Russia | High end software R&D,embedded software development | IBM Global Services Luxoft EPAM | St. Petersburg is an important educational hub,with a large number of institutions offering relevant courses for developing high-end programming skills |
| 9 | Santiago Chile | IT infrastructure and systems management;high end software development | EDS Stefanini IT Solutions | Good supply of educated,IT-proficient workers in Santiago,and it’s an alternative hub for companies that want to consolidate IT services |
| 10 | Sao Paulo,Brazil | Support and maintainance for enterprise resource planning systems,or software for running a business | Accenture EDS IBM Global Services Politec Stefanini IT Solutions | Companies in Brazil have been providing IT outsourcing services to other Brazilian companies for years,so there’s a proficient labor pool in Sao Paulo. |
(Source:BusinessWeek.com)
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FCCA,CA(MIA)with more than 26 years of post-qualifying working experiences. Previous working stints with one of the big accounting four,Regional GFC & Group Treasurer in a group of Malaysian and Group CFO in Singapore public listed concern.Also author to another very popular free educational accounting cum finance blog:http://basiccollegeaccounting.com under the branding of College Accounting Coach.
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