Niyamath Parveez

To the casual observer, India may be the only place that matters for outsourcing but there is a whole world of countries out there that can provide a fantastic service enabling companies and organizations to benefit. The financial aspect is one of the most important elements for a firm and given the fact that the current economic climate is causing many people difficulties, anything which can help a firm build a stronger financial footing should be considered. However, using outsourcing is also a great way of bringing in a different range of skills and experiences that may not have been available in their own country or affordable.

To help companies find what they need to progress their work, there are regular listings and updates of the countries around the world and how they provide outsourcing services. One of the nations who have regularly been hitting the top 10 of all outsourcing destinations of late has been Vietnam and since 2007, Vietnam has made striding moves forward in a very competitive market. The benefits of outsourcing are usually aimed at the firms who will outsource their work but there is also a great deal of benefits to the overall economy of the country that is able to provide a new workforce. Anything which guarantees work and employment has the ability to greatly improve the economic output of a region needs to be seriously considered by a government or local firm and there has been a definite decision by the Vietnamese people to make themselves far more available to outsourcing from different countries. The economic reality is that they are able to provide a workforce at a cheaper price of labor which immediately gives them a head start when it comes to providing outsourcing work but there has to be more than just low cost.

The high quality of Vietnamese workers has been indicated by the high numbers of IT work that Japanese companies to Vietnam for a number of years. This run of success alerted many other nations and firms to the qualities of Vietnam and the news has travelled to Russia. One of Russia’s major outsourcing IT firms; Luxoft has opened a major center within HCM City which they hope will bring them a great number of benefits. The reduction in labor costs is an obvious benefit that Luxoft will hoping to achieve but it should also enable the firm to make an impact on the Japanese market. The longer term approach is one that many firms and organizations are looking to make in order to be able to reap the benefits in years to come. The current economic crisis means that there is a need to be aware of what is happening right now and companies need to safeguard their future but there is also an opportunity to position themselves for later success.
With many firms now believing that India has reached its peak with regards to outsourcing and is struggling to compete with the new arrivals on the outsourcing block, Vietnam is a name that is worth considering if you wish to make moves into new and important markets.

Having already examined the who and what with regards to outsourcing the next obvious topic to consider is the where but some people may be wondering if the where has not already been examined? It is fair to say that when thinking about which firm to work with or the services they need to offer in order for the partnership to be a success that the location of the outsourcing firm needs to be factored in. This is very true but it is vital to give a deeper level of consideration to the geographical location of the outsourcing firm as there are many issues, some of which will not be thought of immediately, that will have a huge impact on the partnership.

There are many countries in the world which have benefitted greatly from outsourcing with India, Brazil, Argentina, Egypt, Vietnam, Sri Lanka and the Philippines all offering a great service for firms looking for outsourcing opportunities. This proves that many different nations can be a success in this role but they all have their own difficulties and problems to overcome and this is something that needs to be remembered when working with offshore providers. Do they have the same level of quality control or enough talent in the workforce? Will they be able to call on an adequate level of suppliers to make the best product possible or will they be let down? If an outsource supplier is let down, this will inevitably lead to problems to the firm who outsourced the work in the first place so it is extremely important to ensure that the full supply chain will be able to cope with any difficulties that may arise. Partnerships that appear perfect on paper can be extremely difficult in the real world and this need to be remembered by firms and companies who are looking to offshore their outsourcing needs.

Not every country has the same level of electrical or IT support which means there may be certain hours of the day when difficulties are more likely to occur. With the difference in time zones, this may not be as treacherous as it could be if the timing is of a beneficial nature to the firm but if it is going to negatively impact on the ability of the firm, there has to be a consideration made about these factors. Even the transportation infrastructure has to be considered because if staff cannot make it into their work on a scheduled basis, the firm will have difficulties in providing a finished product. This is true for call center work as much as it is for manufacturing and production.

Utilizing offshore outsourcing services is a tremendous way for firms to get great value for money and reduce their own costs but if there are geographical issues and problems that will negatively affect the product or service then it may not be in the best interest to use this supplier. It is important to consider every aspect of location and geographical impact when trying to make the best possible decision for outsourcing.