Outsourcing alternatives to the Crimean crisis

By | May 7, 2014

The global market size of the outsourced services knew a continuous and steady growth from 2000 until 2012, with some decrease in 2013. In 2012, the revenue of the global outsourcing market was 99.1 billion U.S. dollars and in 2013 82.9 billion U.S. dollars, according to the site statista.com.

Off-shoring and outsourcing pros and cons

While it seems that everybody agrees that outsourcing or, in its transnational form, off-shoring, is an efficient cost-saving approach and there are plenty of other benefits to it, there are also those who voice concerns regarding shifting operations to third parties. But first let’s see who the third parties are. When speaking about information technology outsourcing (ITO for short) one has to consider the patterns, trends, cultural affinities, and time zone proximity issues. According to services globalization and investment advisory firm Tholons, among the top 8 outsourcing destinations in the world are locations within India and the Philippines. These two are common destinations for both American and European companies, together with some of the Latin American countries (for US and Canada) and, in recent years, Eastern Europe. China and Vietnam are typical ITO destinations for the Japanese companies.
But, while companies worldwide choose this path in order to save costs, expand and gain access to new market areas or simply to take the point of production or service delivery closer to their end users, the debate is intense. Some of the arguments sound economic in nature, but, in fact, they have a lot of political weight, especially after the global recession of 2009: the corporations have the duty to keep and/or create some jobs back home. It is the good ole “they steal our jobs” issue. There are also those who object, based on ethical reasons, to the companies which exploit the cheap, foreign labors (especially in Asia’s emerging markets).
With IT outsourcing there is also some of the more traditional matter of safety (data privacy, including personal information privacy and security concerns) or “they steal our credit card number” issue.
The volatile political climate and the spreading, excessive corruption, present problems to the tech companies looking to send parts of their operations overseas. Indian companies, although important players in IT, especially have to address these two issues: data security and political climate.

The Crimean crisis and alternatives to outsourcing in Eastern Europe

Ukraine, a common destination for IT off-shoring within Eastern Europe has nothing but to lose from the Crimean crisis. In this context Romania proves to be, once more, an ideal destination and a trustworthy partner to well-known multinationals and international brands (Intel, Amazon, Adobe, HP, IBM, Nokia, Microsoft, Oracle, Siemens, Motorola, Alcatel, Solectron, Infineon etc.).
Our professionals are not only highly-skilled but, according to international statistics, Romania has the highest ratio of IT specialists per capita in the world and at the same time offers an attractive price/performance ratio. Add to that fluency in English, German or French, convenient geographical location and cultural affinity with Western Europe, the USA, and Canada and the picture looks very attractive for the companies looking for an alternative to their usual software outsourcing providers.

Build your trust on hard evidence

When deciding to outsource/offshore to Romania it is useful to know that the local intellectual property legislation conforms to EU norms (the copyright law, electronic signature law, electronic commerce law, the law concerning the personal data processing; the protection of private life in the sector of telecommunications are all mandatory laws in the Romanian IT sector). There is also a visa-free regime for EU and US visitors.

Since 2004 Romania is a member of the North Atlantic Treaty Organization and, since 2007, of the European Union. Being placed at the Eastern border of NATO, Romania has consistently supported the strengthening of dialogue and cooperation between the former and the EU. Also, the statute of double membership it’s a warranty of the economic potential and political stability of Romania in Eastern Europe.

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