AVANCES - EXPORT
Transcript of AVANCES - EXPORT
AVANCESAVANCESAVANCESAVANCES
GUATEMALA’S RISE IN THE
GLOBAL BPO SECTOR: OUTSIDE
PERSPECTIVES
Discussion Moderated by: Luke Bujarski, Research Analyst
Nearshore Americas
OBJECTIVES FOR THIS MORNING
�HAVE A GOOD DISCUSSION ABOUT
GUATEMALA’S CURRENT AND FUTURE BPO
MARKET LANDSCAPE
�TALK ABOUT GUATEMALA’S
COMPETITIVENESS IN THE CONTEXT OF
OTHER LATAM MARKETS
�OFFER INSIGHTS ON LATAM MARKETS FROM
U.S. PERSPECTIVE
Gabriel Rozman Blanca Trevino Marco Stefanini TCS Softtek Stefanini
MEDIA PLATFORM FOR LATAM BPO
CONNECTING
BuyersTo
Markets
INFORMING
Providers
On
Trends
DRIVING
Nearshore Market
MOMENTUM
2009
GLOBAL OUTSOURCING OVERVIEW
Cost Savings
Focus on Core
Business
Access to
Talent
Expansion into
new markets
Software development &
testing
Data infrastructure
(cloud)
Web & Apps development
Applications management
(SAP)
Gaming
Software development &
testing
Data infrastructure
(cloud)
Web & Apps development
Applications management
(SAP)
Gaming
Finance & Accounting
Human Resources
Travel Expenses
Finance & Accounting
Human Resources
Travel Expenses
Customer Support
Inbound/Outbound Sales
Accounts Receivable
Claims Processing
Customer Support
Inbound/Outbound Sales
Accounts Receivable
Claims Processing
Data Analytics
Market Research Services
Legal Process outsourcing
R&D
Data Analytics
Market Research Services
Legal Process outsourcing
R&D
GEOGRAPHY OF OUTSOURCING
ONSHORE
OUTSOURCING
OFFSHORE
OUTSOURCING
NEARSHORE
OUTSOURCING
Audience question:
What factors do enterprises consider when deciding on a sourcing destination?
GEOGRAPHIC CONSIDERATIONSNEARSHORE or OFFSHORE?
ATTRIBUTE LATAM INDIA
Labor Costs Strong savings potential 10%-15% better than LATAM
Service MaturityStrong local demand
Recent exports
Less local demand
Mature Exporter
Attrition Low attrition & turnover Extremely high turn over
ProximityReal-time services
Short travel time
Off-hours processing
Long Commute
Skills
Large, capable, growing pool
Spanish 1st , English 2nd
Very large, capable, growing
pool
English, limited/ no Spanish
Cultural Affinity
Strong relations with US
Latino Population
Required cultural training and
accent reduction
�financial incentives
�business environment
�labor force
�cultural affinity
�time zone alignment
�technological readiness
�language capabilities
Nearshoring Destinations Index
Released by ThinkSolutions
WHAT OUR READERS NEED TO KNOW
Now that nearshore advantages are
understood…
�Time Zone
�Cultural Affinity
�Proximity
…what else do investors need to know to
make the right decision?
RECENT HEADLINES
IBM Commits to Another 1,000 Hires in Costa Rica,
Dismissing Talk of a Labor Shortage
-The new $300 million IT center, expected to start offering services by Q1 2012, will focus on infrastructure management, servers, networks, database administration, security and cloud computing.
“Pro-Business” Ortega Makes Surprise Appearance at
Nicaragua Conference
“President Ortega has shattered previous perceptions, and I am very encouraged by the pro business and pro commerce message coming out of the cabinet and the President” – Peter Ryan, Ovum
Analyst
RECENT HEADLINES
Chile’s Service Sector is on Fire: A Classic Success
Building a Knowledge Economy
-As of now, the main markets for technology developed in Chile are Peru,
Colombia and Central America.- The Chilean services sector accounted for $13 billion during 2009-2010.
Honduras Starts to Make Real Headway as a BPO Player- A watchful eye on ongoing political and economic reforms will be needed to ensure that existing and prospective investments do not run afoul.
- Confidence in Honduras from a commercial standpoint received a shot in the arm with the publication of the World Bank’s Global Competitiveness
Report, which increased the country’s ranking from 91 to 86.
RECENT HEADLINESGuatemala Ramps Up BPO Services, But Can it Meet Skilled
Labor Demands? (2010)-The perception in following years was of a saturated labor market and a country that had missed its peak.
- Recently however, Guatemala is pulling off an impressive comeback in BPO
and contact center services.
Site Selection: Getting Good Labor Data-With the absence of census data and other reliable statistics, there is significant difficulty in finding quantifiable information that is critical for
making location decisions.
-population, unemployment rates, underemployment rates and education factors, while occasionally available are most often not reliable. Labor
Studies are becoming increasingly more important .
WHAT INFLUENCES LOCATION CHOICE?
Data source: “Outsourcing Strategies”, Author: Ilan Oshri
CENTRAL AMERICA MARKET OVERVIEW
VARIABLES Costa Rica Nicaragua Honduras Guatemala
Costs
Government
Policy
Country Risk
Infrastructure
Access to talent
Audience Question: What are your
experiences across these different markets?
LABOR POOL ANALYSIS
Source: CIA World Factbook
LABOR POOL ANALYSIS
Source: CIA World Factbook
LITERACY AND INTERNET USAGE
Source: CIA World Factbook
MARKET LANDSCAPE - NICARAGUASTRENGTHS
- Relatively cheap labor force
- Market still new
- Dual currency economy
- Strong investment agency
- Crime rates low
WEAKENESSESS
- Physical infrastructure under developed
- Costs of electricity high
- Questionable political structure
OPPORTUNITIES
- Market open to small to mid sized firms
- Continued foreign investment
THREATS
- Deterioration of personal safety conditions
- Continued lack of infrastructure
MARKET LANDSCAPE – COSTA RICASTRENGTHS
- Strong mix of ITO and BPO
- Proactive government
- Positive perception from Tourism industry
WEAKENESSESS
- Expensive labor force and property
- Competition between industries
- Small population and workforce
OPPORTUNITIES
- Continued promotion as center of excellence
- Attention from big IT firms IBM (proven market)
THREATS
- Fiscal pressure to impose taxes on free trade zones
- Underfunded security resources
Amway - Astra Zeneca SS – APL – Auxis - Baxter Americas - British American Tobacco
Chiquita Brands - Citi Business Services - Curtiss Wright – DHL - Dole SS - Emerson SS
LAND OF THE CAPTIVES
MARKET LANDSCAPE - HONDURASSTRENGTHS
- New Market – untapped labor pool
- Low costs
WEAKENESSESS
- Underdeveloped building infrastructure
- Unproven market
OPPORTUNITIES
- Expand into Tegucigalpa
- Room to accommodate bigger player with
right level of investment
THREATS
- Political and economic instability
- Further deterioration of personal safety situation
- Economic vulnerability
San Pedro Sula
Population 1.5 million
San Pedro Sula
Population 1.5 million
Tegucigalpa
Population 1.3
million
Tegucigalpa
Population 1.3
million
GUATEMALA’S BPO CLUSTER
TOTAL POPULATION: 13.8 Million
TOTAL WORKFORCE: 4.1 Million
BPO Employment: Voice: 12,000 BPO: 5,000
MARKET LANDSCAPE - GUATEMALA
STRENGTHS
Largest labor pool in Central America
Big economy more resistant to wage inflation
Proven cluster with big name players in BPO
Costs 25-30 percent cheaper than Chile & Poland
WEAKENESSESS
K-12 education system needs improvement
Bilingual education needs improvement
Mixed signals from the government
OPPORTUNITIES
Desire to expand by incumbent firms
Great potential in labor pool
Increased interested in Guatemala for Latin America clients
THREATS
Concerns of personal safety
Concerns of recent elections
Concerns of labor rights disputes
Guatemala Has a Good Answer When
Stability Questions Arise
Rolando Yon, CFO at Capgemini Guatemala
http://nearshoreamericas.com/category/video/?video-id=3836
QUESTIONS
15,000 unique visitors /
month30,000 page views /
month
1,000 Followers
SPONSORS & BANDWIDTH
Figure Thirteen: Overall perceptions on safety in GDL
(number of responses)
�Cost Inflation
�Currency Fluctuation
�Intellectual Property
?Personal Safety
?Geopolitical risk
?Labor Uprisings
CASE STUDY ON GUADALAJARA