Large companies are accelerating their use of offshore outsourcing, and as many as a quarter of IT jobs at Global 1,000 firms may be moved offshore by 2010, according to The Hackett Group, a Miami-based consulting firm whose clients include many multinational corporations. See Survey: One in four IT jobs moving offshore from www.computerworld.com And the chances are they are correct. Increase if offshoring combined with unemployment rate highest in 26 years paints a very scary picture. What does it mean for IT professional in this country? Does it really mean “R.I.P. Good Times”? Probably not, it just means that times have changed and it’s time to change. First and most important it to recognize that offshore outsourcing is here to stay, as long as there is substantial difference between compensation rates for IT skills around the world there will be compelling reasons to move the jobs top the regions with lower rates.
Of course with world getting flat one day that place could be closer to you home than you have thought… A good friend of mine just came back from her trip to Hong Kong / Beijing / Shanghai. While she was deeply impressed with all new constructions and Olympic architecture she was really astonished with price raise across the board. Cost of living in cities such as Moscow, Kiev or St. Petersburg is astounding. Real estate prices in Bangalore challenge many US cities. A few months ago while walking on Rambla in Barcelona I just had to take a picture of great deal on flip-flops – and that’s before the dollar surged against Euro (so the discounted price below is ~$270).
Take another look at the price above and think about Spain which according to Gartenr is one of top 30 outsourcing destinations… The changes in prices are dramatic and they are just a reflection of changing standards of living, of changing and reshaping a distribution of wealth. Changes in cost of living inevitably find their way in offshore rates and eventually in IT execs minds. And that means profound changes in the IT Outsourcing landscape.
December 11, 2008
Posted by Nick Krym |
News, Articles, Thoughts and Comments |
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Selecting offshore destination just got easier – Gartner has its new list now. While I am often skeptical about info you can get from Gartner reports, in particular in its application to small to medium sized businesses, I believe in its value as long as it’s taken with a grain of salt. “Determining the country or countries that are best placed to host offshore IT operations is a daunting task for many organizations, according to Gartner, Inc. This year, Gartner has assessed the suitability of 72 countries as offshore locations, and has announced its ‘Top 30’*. The analysis showed that the dynamic nature of the market has seen a number of countries position themselves as credible alternatives to the BRIC countries (Brazil, Russia, India and China)…“
“In 2008, Gartner’s top 30 locations for offshore services, by region, were:
- Americas: Argentina, Brazil, Canada, Chile, Costa Rica, Mexico and Panama
- Asia/Pacific: Australia, China, India, Malaysia, New Zealand, Pakistan, the Philippines, Singapore, Thailand and Vietnam
- Europe, the Middle East and Africa (EMEA): the Czech Republic, Egypt, Hungary, Ireland, Israel, Morocco, Poland, Romania, Russia, Slovakia, South Africa, Spain and Ukraine
Although only seven countries from the Americas appeared in the final list of 30, these countries are becoming an attractive proposition for the largest buying market for offshore services – the US. “
See more on Gartner Identifies Top 30 Countries for Offshore Services in 2008.
Also see good insight in NetworkWorld reaction By John Ribeiro India’s competitors catching up as outsourcing hotspots.
December 11, 2008
Posted by Nick Krym |
News, Articles, Thoughts and Comments, Offshore Vendor Selection | Offshore Current Affairs, Offshore Tips |
1 Comment
The Pragmatic Outsourcer series consists of 5 volumes, each covering a different phase of the outsourcing process. Volume 1: Making the Decision is available today for your free download. Volumes 2 through 5 will be available during 2010.
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1 out 4 IT jobs moving offshore
Large companies are accelerating their use of offshore outsourcing, and as many as a quarter of IT jobs at Global 1,000 firms may be moved offshore by 2010, according to The Hackett Group, a Miami-based consulting firm whose clients include many multinational corporations. See Survey: One in four IT jobs moving offshore from www.computerworld.com And the chances are they are correct. Increase if offshoring combined with unemployment rate highest in 26 years paints a very scary picture. What does it mean for IT professional in this country? Does it really mean “R.I.P. Good Times”? Probably not, it just means that times have changed and it’s time to change. First and most important it to recognize that offshore outsourcing is here to stay, as long as there is substantial difference between compensation rates for IT skills around the world there will be compelling reasons to move the jobs top the regions with lower rates.
Of course with world getting flat one day that place could be closer to you home than you have thought… A good friend of mine just came back from her trip to Hong Kong / Beijing / Shanghai. While she was deeply impressed with all new constructions and Olympic architecture she was really astonished with price raise across the board. Cost of living in cities such as Moscow, Kiev or St. Petersburg is astounding. Real estate prices in Bangalore challenge many US cities. A few months ago while walking on Rambla in Barcelona I just had to take a picture of great deal on flip-flops – and that’s before the dollar surged against Euro (so the discounted price below is ~$270).
Take another look at the price above and think about Spain which according to Gartenr is one of top 30 outsourcing destinations… The changes in prices are dramatic and they are just a reflection of changing standards of living, of changing and reshaping a distribution of wealth. Changes in cost of living inevitably find their way in offshore rates and eventually in IT execs minds. And that means profound changes in the IT Outsourcing landscape.
December 11, 2008 Posted by Nick Krym | News, Articles, Thoughts and Comments | 1 Comment