With the fast-growing application of automation technology, automation and cybersecurity are increasingly becoming key factors in any outsourcing decision. In GSLI 2019, A.T. Kearney has made a significant change in its evaluation criteria to reflect the rapid shift of businesses to the digital era.
The report focuses on lower-cost countries that are taking the large market shares of the current global outsourcing market. The report, however, includes some higher-cost countries such as the United States, the United Kingdom, France, and Germany as the benchmarks for demand markets, other higher-cost countries such as South Korea and Japan are not included.
This year GSLI report reflects the rising impact of automation and security, A.T. Kearney added new evaluation category digital resonance, which has following factors:
- Digital skills of the country’s workforce
- Legal and cybersecurity, meaning how the legal framework takes digital business models into account
- Corporate activity, defined as the amount of capital invested in start-ups and the number of deals by venture capitals (VC) in 2018
- Digital outputs including creative products, as well as knowledge and technology outputs
- In this year's report, Vietnam remains very attractive in terms of cost with its sizable digital workforce pool available for the IT outsourcing and BPO. In general, Vietnam was ranked number five (05) moving up one position since the last report. Vietnam had the third-largest increase in the business environment score, driven by a large score increase in the country's infrastructure component, thanks to the action of the new leadership team who are emphasizing on startup and digital transformation. Big foreign companies in the world continue to invest in Vietnam, showing continued momentum for the ICT industry. Japanese IT companies are increasingly using offshore outsourcing services in Vietnam for ITO and BPO. The report indicates that Vietnam currently has over 20,000 employees working for Japanese companies in both offshore software development and business process outsourcing. Since the year 2000, Japanese IT companies see Vietnam as the offshore outsourcing solution for their shortage of labor force. Vietnam is seen as an attractive alternative to China thanks to its low cost, a large pool of skilled software engineers and cultural similarity.
- The Vietnamese government is executing an aggressive plan to develop a more highly skilled workforce, and the country is dedicated to higher education and to fostering English and Japanese proficiency. English is taught as a foreign language since elementary school. Japanese, French, and German are also taught as a foreign language in some junior high schools. Also in Vietnam, there is a large community of Chinese people. This makes Vietnam a promising location in providing language support services such as call center, contact center in Japanese, Chinese, English, French, and German.
- In Digital resonance criteria, Vietnam was ranked #37 with a score of 3.72 due to its lower score in Corporate activity. In the last few years, more and more investments are coming to Vietnam startups.
- In Cybersecurity investment, Vietnam was grouped in the Nascent group, in the same group with India, China, Phillipe’s, Indonesia, Thailand, Mexico, Brazil, Poland, and Russia.
About us: TMA Solutions was established
in 1997 to provide quality software
outsourcing services to leading companies worldwide. We are one of the largest software
outsourcing companies in Vietnam with 2,600 engineers. Our engineering team was
selected from a large pool of Vietnam IT resources; they are well-trained and
have successfully completed many large and complex projects.
Visit us at: https://www.tmasolutions.com/
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