Out-Law / Your Daily Need-To-Know
India is far ahead of its offshoring competition, according to new research from Gartner. But strong governmental support is rapidly propelling China’s capabilities into the frame while Latin America, Brazil and Mexico are increasingly attractive options.
In Eastern Europe, the Czech Republic, Hungary, Poland and Russia are among the countries to watch and, despite India’s current prominence, Gartner recommends that organisations seeking an offshore provider consider multiple country options around the world.
Ian Marriott, research vice president at Gartner, pointed out that any outsourcing contract brings risks that have to be managed.
"When using offshore service providers, these common risks become more prominent, and some uncommon risks appear," he said. "Although infrastructure, process, project management and security risks are normal in any [external service provider] relationship, human capital consistency, sociopolitical bias or legal jurisdiction are not typically included in the due diligence process for vendor selection. Organisations must understand the various types of risks when using global software teams or offshore outsourcing, and assess each through a more rigorous due diligence of the short listed offshore firms.”
Gartner said that interest in nearshore (geographically close) options for IT services and BPO is strong, particularly in Western Europe, largely due to language requirements.
For Europe, Ireland, Northern Ireland and Spain are mature locations. Eastern Europe is attracting offshore investment whilst parts of Africa are also positioned for growth. For the US, Canada and Mexico are the most likely nearshore options.
