The notion of outsourcing is increasingly changing and it no longer refers to the removal of businesses or jobs from a country. On the contrary, today outsourcing is more about forming global partnerships and exploring efficacious ways of completing crucial projects. While India and Philippines have garnered immense appreciation and acceptance worldwide for being top outsourcing destinations, gradually, many new countries are emerging as providers of best-in-class resources and quality-focused solutions while giving global organizations a lot of reasons for outsourcing. One of them is Latin America.
One of the new names evolving in the outsourcing business is Latin America. Owing to time-zone compatibility, cultural similarities, and a tech-savvy demographic, Latin America offers high-quality development services to the companies outsourcing in the region. As per a study conducted by the London School of Economics and Brookings Institute, Santiago in South America has been ranked at #5 amongst the 10 best economically performing cities in the world. Innumerable trends in the continent of Latin America have created an ever-growing pool of IT talent which can then be deployed by companies to achieve low-cost development services. Today, many top US based companies, including Globant, Toptal, Scalable path and many more are progressively looking at Latin America as a potential offshore center for their future development projects. In this article, we will provide an insight about the main reasons to outsource to Latin America, and how it stands to affect the global economy.
Here are the top 10 reasons, which signify how outsourcing to Latin America can help your business.
Most Latin American countries are developing state-of-the-art IT and business hubs and are giving companies worldwide a plethora of reasons to outsource their services. As per the A.T. Kearney Global Services Location Index, a study which tracks the offshoring landscape across the globe, 5 Latin American countries are present in the Top 20 countries where business is outsourced. The parameters that were considered for the study include business environment, people's skills and financial attractiveness. The countries that are included in this list are Mexico, Brazil, Costa Rica, Chile, and Colombia. With favorable business policies and political stability, these countries can be chosen as your next offshoring option to gain further business benefits.
Although many believe that while outsourcing projects, cost should not be the only factor, nobody would deny that it plays a pivotal role. Cost-effectiveness is among the top aspects one considers while deciding about their outsourcing partner and Latin American countries are quite cost-efficient when it comes to outsourcing development projects. The hiring rates for quality developers and other similar professionals are much lower than the USA, a factor which plays as a strong point for Latin American countries.
One of the biggest disadvantages that firms in the USA experience while outsourcing the development work to India and China is the large time zone difference. On the flip side, when the time zone difference between USA and Latin American countries is calculated, its negligible. This significantly reduced time difference allows mush lesser response times between the teams and highly synchronous communication, enabling the resolution of issues quickly. Communication is one factor which tends to suffer due to large differences in time zones and outsourcing to Latin American countries eradicates this issue completely.
Most Latin American countries boast abundant tech talent as the number of qualified and experienced developers is on the rise in such countries. Even when browsing through online freelancing websites for programmers, one can find thousands of high quality programmers from the countries subsuming Peru, Argentina, Brazil, Chile, Colombia and many more. The technical workforce in these countries is growing steadily & will continue to grow, and this is one of the most prominent reasons for outsourcing to Latin America.
Latin America has been known as a growing hub for advanced agile development for quite long. Furthermore, the time zone alignment with the North American companies makes it an ideal destination for the agile partnerships with a variety of staff solutions. This time zone alignment is enhanced and complemented by the strengths offered by the Latin American workforce. It has been attested by the panelists that Latin American professionals tend to communicate more openly and directly and have a creative approach towards problem-solving.
Being primarily comprised of English speaking nations, it has been established that several Latin American countries surpass India and China when it comes to English proficiency, and is one of the main reasons to outsource to Latin America. With major drives initiated by President Barack Obama for expanding education exchanges in higher learning, the Latin American countries have started investing more in English language training as well.
The culture of the United States of America and Latin America, both have been strongly influenced by European civilizations. Furthermore, while these two have a lot of cultural differences, there are certain similarities which extend into identical business approach and work styles, making it easier for professionals from both the places to collaborate.
The Latin American developers seem to be more creative and assertive, viewing the business relationships more as the partnerships instead of hierarchical worker/client relationships. On the other hand, the Asian countries work in an opposite manner. Thus, it is beneficial for businesses to consider Latin America as the place to outsource their development projects for achieving better results and developing sustainable relationships.
As the global marketplace for outsourcing services is expanding, Latin America is evolving more rapidly. With countries like Brazil, Chile and Colombia taking the lead, there are several other Latin American countries which are gradually making their place in the offshoring landscape. As per a KMPG Study carried out in 2014, the Latin American outsourcing industry grew approximately at a rate of 10% in 2017.
For a long time, IBM and HP were the only major names who had made investment in Latin America. Accenture also made a significant investment, but at the same time, it was following a country specific strategy. However, the scenario has completely changed now. Many other companies have started making major investments in the region, including Cognizant, Capegemini, TCS, Infosys, HCL, Wipro, US Global etc.
Why do companies outsource? Well, because they seek cost savings and cost-efficiency and Latin America offers this advantage.
The biggest economic success stories in Latin America have been those companies which have leveraged the power of free trade. While Latin America is expected to remain more economically volatile than most other markets due to the lack of a central bank coordinating monetary policies across the continent, the companies which invest in the region have more options and more confidence owing to a slew of free trade agreements which have been signed in the last decade.
The aforementioned business benefits and top reasons to outsource to Latin America ensure that the companies which seek outsourcing partners in Latin America can get considerable business benefits over outsourcing to usual destinations in Asia. If you are seeking a reliable offshoring partner for your custom development project with delivery centers around the world including in Latin America, Flatworld Solutions offers it impeccable services.
We offer a broad array of services for a plethora of industry verticals and our seasoned professionals excel at delivering tailored projects as per your needs. Feel free to share your project requisites or queries, and our executives will provide you the apt solutions and satisfactory services.
Find out why outsourcing is here to stay, and how your company can benefit.
A few essential reasons why outsourcing is the best option for you.
Useful tips for outsourcers concerned about data security and confidentiality.