It's Harvest Time in Central/Eastern Europe

TEAM International is up with its latest summary of the Q1 2009 results for the CEE region. All in all, Central and Eastern Europe is positioned as an attractive IT offshore and nearshore outsourcing destination, with a number of bulleted conclusions and figures to support the finding. The major achievement is that there’s no doubt that CEE is no more a rising star, but a competent player in the software market.

Here are the other conclusions drawn as a result of thorough research works:

• More clients from Western Europe are choosing nearshoring IT functions to their less developed European neighbors rather than outsourcing to traditional Asian destinations. Organizations are no longer satisfied with just low-cost and are focusing on vendors’ competence, high-tech know-how and staff integration. CEE countries consistently execute high quality projects and have shown business and technical competence and cultural compatibility with customers from Western Europe and North America.

• The CEE region is ranked No 3-4 in the global marketplace in terms of the number of people involved in IT outsourcing and the value of provided services respectively.

• The CEE countries are notable for technology-oriented educational system and a solid Research & Development foundation.

• In 2008 CEE faced a small number of company closures and staff reduction (5-7% across the industry). In 2009 many new businesses and start-up projects boomed in the region.

Source: ITO News

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Europe Outsources for Quality

A new study by Ernst & Young completed last month found that Europeans are becoming more open to outsourcing. Being one of the few research works analyzing Europe’s openness towards outsourcing, the study showed that outsourcing was being used by 70 per cent of the European firms surveyed.

The British are, however, likely to outsource only a few standard functions, while the French and Belgians are open to outsourcing a wide range of functions.

Also, compared to 70 per cent of respondents that had at least one outsourcing relationship, only 49 per cent of respondents cited cost savings and higher productivity (revenue earned per employee) as the advantage of outsourcing for their organization. About 33 per cent identified better quality through use of specialized skills.

“French companies attribute less importance to cost-saving benefits, with improvements in quality and strategic organization being the key advantages identified. Belgian companies are also strong proponents of the improved quality brought by outsourcing, while in the UK, quality considerations are rated on a par with cost savings,” the study said.

Source: The Economic Times

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