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Top 10 Emerging Outsourcing Cities
Stiffer competition is arising from South America and MENA regions to capture a significant share of the global outsourcing market. Each city in the Emerging list has been positioning itself and their respective niche services and specific target markets - leading to more defined value propositions per city.
• The only Eastern European city, Krakow leads the Top 10 Emerging Outsourcing Cities List. The city, constantly moving up the ranks since 2008, has built expertise in delivering FAO services with improving service delivery maturity for ITO and HRO services. Large multinational companies have established their presence in the city, like Capgemini, Google, IBM and Microsoft.
• Beijing, second in the list, has its enormous scale and talented labor for ITO services as its primary strength. In fact, the ITO sector has already captured 80% of the total outsourcing revenues of the city. However, Beijing continually faces challenges improving its business climate as it remains affected by strict government regulations.
• Buenos Aires, the primary outsourcing city of Argentina, also moved one place higher in this year’s rankings. The city has been harnessing its capabilities in delivering multilingual Contact Support Services to key markets. This specialization contributes to the improving service delivery maturity of the city.
• A notable outsourcing city of the MENA region, Cairo moved to fourth place this year. The fusion of nearshore advantage to Europe and multilingual skills of the people, positions the city in delivering quality voice-based services to European and Arabic markets.
• Sao Paolo continues to move up the rankings, being the banner high-value ITO city of Brazil. With still an underutilized pool capable of fulfilling R&D and Engineering services, Sao Paolo is poised for better positioning in high-value services in the coming years.
• Vietnam’s Ho Chi Minh, an ITO-centric city, has significantly dropped three places due to scalability and employability of its labor pool and as service providers in the city have begun to experience scale-up issues.
• Leaping 3 places, Dalian is one of the impressive emerging outsourcing cities this year. The city experienced an estimated 30% increase in software and services outsourcing exports last year. Dalian has remained successful in targeting the Japanese and South Korean markets for ITO and KPO services.
• Shenzhen moved one rank lower this year due to lower annual graduate output coupled with challenges in creating conducive business environment for investors.
• Curitiba takes ninth place this year. The city government has embarked various initiatives like Curitiba Offshore Center to promote the city as a prime ITO hub in Brazil.
• Sri Lanka’s chief outsourcing city, Colombo, closes the Top 10 Emerging Cities List. A significant factor for its inclusion is the recognition of its capabilities for delivering FAO services, together with the improvement of the perceived business and political risk.