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A Buyer's Guide to Offshore Outsourcing

A Buyer's Guide to Offshore Outsourcing

Wondering where to send your call centres, application development and QA testing? Check the map for a worldwide comparison of prices, risks and other critical considerations.

Nearly half of all CIOs use offshore providers today, and two-thirds plan to send work overseas next year, according to US-based Forrester Research. India is still the leader, but as more companies seek to source globally, more countries are emerging to benefit from that demand - each with its own particular strengths and weaknesses. There's much to gain from cross-border collaboration. But given that a quarter of offshore projects fail to meet expectations, there's just as much to lose. The keys are picking the right place, partner and project for your needs. To help you out, we've culled the most critical information you need on the 26 countries that are the strongest contenders for your outsourcing dollar.


How We Reached Our Ratings

Leader, Up-and-comer and Rookie status labels are based on the maturity of the industry, the size of the market, the availability and cost of skilled labour, and the infrastructure (both government support and actual technology infrastructure) to support a significant IT services market.

Geopolitical risk ratings are based on reports by PRS Group, a US-based business information provider. Most infrastructure ratings are based on Global Technology Index reports from Meta Group.

Additional information provided by Giga Information Group, Marty McCaffrey (Software Outsourcing Research), Brooke Nicole Consultancy, Gartner, Forrester Research, Renodis, Outsourcing-Russia.com, Mexican Association of Information Technology Enterprises, Philippine IT Offshore Network and Research Vietnam.


Asia/Far East

PAKISTAN: Rookie.

Geopolitical risk.

English proficiency.

Average programmer salary: ($US3600-$6120/year)Infrastructure: FairPros: Like India, Pakistan is attempting to focus on software quality and processes.

Cons: Pakistan has the highest geopolitical risk of any country we examined. The country has a PR problem, to say the least, which has halted what was great potential for growth. Travel here is obviously a bad idea.

Insider tip: Pakistani people portray better English skills than exist in India.

INDIA: Leader.

Geopolitical risk.

English proficiency.

Average programmer salary: ($US5880/year; $US18-$25/hour)Infrastructure: Poor. However, the government is attempting to strengthen telecom infrastructure and build fibre-optic networks in city centres of software activity, as well as providing uninterrupted power supply.

Pros: With the early-mover advantage, India remains the offshore country of choice: a large, low-cost, English-speaking talent pool and the most mature market in the world.

Cons: Poor infrastructure, in general, political instability, distance and increased competition from other developing nations threaten India's position as outsourcing king of the world. Supply may not continue to meet demand.

Insider tip: Look past the five biggest companies (Tata Consultancy Services, Infosys Technologies, Wipro Technologies, Satyam Computer Services and HCL Technologies) to midsize providers (SSI Technologies, Visualsoft Technologies, Ramco Systems) for personalised service and better prices.

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