When you think of outsourcing what comes to your mind? Probably India and then China. But more specifically Bangalore, Hyderabad, Chennai, Shanghai and Mumbai right? Well you can forget about them because the outsourcing hubs of tomorrow will be something like Zagreb and Penang, says a report by KPMG. The first is a city in Malaysia, while the other is in Croatia and several other unheard of places might become the next offshoring mammoths of the world according to the new report which list down 31 such places.
The report indicates that traditional centers are faced with overburdened telecommunications infrastructure and have overstretched labor markets so should be overlooked henceforth. Instead, the report urges companies to look at alternatives it suggests such as cities in the Asia-Pacific region that offer lower costs, younger populations, and government incentives such as easy work permits. While those in Europe, Middle East, and Africa have robust telecommunications and power infrastructures and niche specialization in fields such as data management. While cities in the Americas can leverage their large pools of labor, a more mature service offering, proximity to major client bases, and multiple language skills.
What is curious yet appropriate is that size is not a deciding factor for these emerging cities to be on the list. Cities such as Buenos Aires is home to around 1.3 crore people, while Gdansk in Poland has just 8,00,000 people. The report emphasizes on the proportion of computer graduates, the number of research and development institutions, the rate of migration to the cities, and common languages with their target markets. Also, Jaipur and Nagpur featured on the list of 31.