Next 5 Offshore Nations
These five countries offer the strongest value propositions to clients based on the Location Assessment Platform and are considered as prime locations when considering specific outsourced processes.
Oct 15, 2009
Established offshore nations with a high degree of maturity and record of successful delivery capabilities are categorized as the Top 5 Offshore Nations. These countries typically have centers of excellence across multiple outsourcing segments and rank highly in a number of location-assessment scenarios. These five countries offer the strongest value propositions to clients based on the Location Assessment Platform and are considered as prime locations when considering specific outsourced processes. These emerged destinations will most often also have the unique advantage of scale and capacity as compared to smaller or emerging locations.
The difference between the Top 5 and the Next 5 offshore nations is most pronounced in the service-level maturity. In terms of potential, the Next 5 are not far behind, however this potential is considered to be still unrealized due to specific inhibiting factors. It also must be stated that the service-level maturity has been taken into consideration from the client point of view, as client nations look at offshore nations in a distinct manner. This has been taken into consideration when categorizing locations. This customer perception may change or alter over time, but takes significant effort and time on a destination’s operational front. Successful service delivery is the most significant factor in altering customer perception.
An interesting characteristic of Canada’s outsourcing industry is evidenced in the fact that despite its relatively higher costs compared to other nearshore destinations south of the U.S., such as Mexico and Costa Rica—Canada remains an attractive investment site for service providers. This is due to the wide array of outsourced services the country provides which includes low-end services in customer support to high-value shared services centers. However, the country’s niche service continues to be of high-value services in FAO, engineering services as well as ITO-related processes in applications development and management, testing and R&D. Several area clusters in the country house outsourcing hubs such as Toronto, Halifax, Calgary, Montreal and Vancouver.
Russia
Russia continues on the path of becoming one of the leaders for hi-tech R&D outsourcing in the world. Russia’s deepening service delivery expertise and rich talent pool have made the country a research factory for top organizations like Intel, IBM, Motorola, Samsung and Google. Being a part of the Eastern European outsourcing region has also enabled Russia to collectively share the niche service characteristic for the offshoring and outsourcing industry. The country, however, stands out in the region due to its capacity to fulfill large-scale, high-value services.
Mexico
With a business landscape centered on manufacturing and historically catering to the U.S. market, Mexico has slowly added outsourced services into its business portfolio. The country is considered to be one of the Next 5 offshore destinations—an attribute owed to its favorable nearshore characteristics. Outsourced services in the country started with voice-based services catering to both English and Spanish speaking customers. This attribute—the provision of multilingual capabilities—distinguishes it from Asian competitors such as India and the Philippines.
Vietnam
Vietnam’s economic growth over the last several years has been invaluable towards its emergence as a Next 5 Offshore Nation. For instance, net FDI inflow to Vietnam reached $6 billion in 2007, up from $2.3 in 2006. Further, even as the global economic crisis took full swing towards the end of 2008, Vietnam’s GDP grew by a decent 6.2 percent by year-end, just down from 8 percent posted in 2007. The country’s economic dynamism is also attributed to its rapidly maturing business environment. Vietnam is perceived as one of the more vibrant destinations for engineering services outsourcing and software development services in the Asian region.
Poland
Poland is emerging as a premiere nearshore shared services center for Western European and Scandinavian client markets. With its capabilities in serving the full spectrum of services in both ITO and BPO spaces—Poland has emerged as arguably the strongest competitor in the region for a spot in the Top 5 Offshore Nations list. While other countries in the region struggle to develop and build a scalable/employable talent pool, Poland’s population of almost 40 million and world-class education system—has successfully positioned its place among the top offshore nations.
This article was originally posted by Global Services and is the property of Global Services.
The difference between the Top 5 and the Next 5 offshore nations is most pronounced in the service-level maturity. In terms of potential, the Next 5 are not far behind, however this potential is considered to be still unrealized due to specific inhibiting factors. It also must be stated that the service-level maturity has been taken into consideration from the client point of view, as client nations look at offshore nations in a distinct manner. This has been taken into consideration when categorizing locations. This customer perception may change or alter over time, but takes significant effort and time on a destination’s operational front. Successful service delivery is the most significant factor in altering customer perception.
Next 5 Offshore Nations
CanadaAn interesting characteristic of Canada’s outsourcing industry is evidenced in the fact that despite its relatively higher costs compared to other nearshore destinations south of the U.S., such as Mexico and Costa Rica—Canada remains an attractive investment site for service providers. This is due to the wide array of outsourced services the country provides which includes low-end services in customer support to high-value shared services centers. However, the country’s niche service continues to be of high-value services in FAO, engineering services as well as ITO-related processes in applications development and management, testing and R&D. Several area clusters in the country house outsourcing hubs such as Toronto, Halifax, Calgary, Montreal and Vancouver.
Russia
Russia continues on the path of becoming one of the leaders for hi-tech R&D outsourcing in the world. Russia’s deepening service delivery expertise and rich talent pool have made the country a research factory for top organizations like Intel, IBM, Motorola, Samsung and Google. Being a part of the Eastern European outsourcing region has also enabled Russia to collectively share the niche service characteristic for the offshoring and outsourcing industry. The country, however, stands out in the region due to its capacity to fulfill large-scale, high-value services.
Mexico
With a business landscape centered on manufacturing and historically catering to the U.S. market, Mexico has slowly added outsourced services into its business portfolio. The country is considered to be one of the Next 5 offshore destinations—an attribute owed to its favorable nearshore characteristics. Outsourced services in the country started with voice-based services catering to both English and Spanish speaking customers. This attribute—the provision of multilingual capabilities—distinguishes it from Asian competitors such as India and the Philippines.
Vietnam
Vietnam’s economic growth over the last several years has been invaluable towards its emergence as a Next 5 Offshore Nation. For instance, net FDI inflow to Vietnam reached $6 billion in 2007, up from $2.3 in 2006. Further, even as the global economic crisis took full swing towards the end of 2008, Vietnam’s GDP grew by a decent 6.2 percent by year-end, just down from 8 percent posted in 2007. The country’s economic dynamism is also attributed to its rapidly maturing business environment. Vietnam is perceived as one of the more vibrant destinations for engineering services outsourcing and software development services in the Asian region.
Poland
Poland is emerging as a premiere nearshore shared services center for Western European and Scandinavian client markets. With its capabilities in serving the full spectrum of services in both ITO and BPO spaces—Poland has emerged as arguably the strongest competitor in the region for a spot in the Top 5 Offshore Nations list. While other countries in the region struggle to develop and build a scalable/employable talent pool, Poland’s population of almost 40 million and world-class education system—has successfully positioned its place among the top offshore nations.
This article was originally posted by Global Services and is the property of Global Services.