issue 1 - Roland Berger

p industry report
nearshoring
El Dorado in Central Europe
With the European Union’s enlargement, the IT service industry has now discovered a nearshoring
El Dorado in Central Europe. While India has served as an economically attractive software supplier,
entire business processes are currently being relocated to Budapest, Krakow and Tallinn.
:
Dirk Taubner can see shortcuts from
a long way off. As head of human
resources at software design & management
(sd&m), an IT consultancy based in Munich,
Germany, Taubner arranged for Polish IT
specialists to gain experience in Germany
for a year. Once the new employees had
become sufficiently acquainted with the
German mentality and the latest technology,
Taubner decided to take a step
across the border. Since July, 20 employees
have been working in Wroclaw, Poland, in a
newly created “nearshore center” for
German customers. Another 80 specialists
will soon be added to their ranks. “The only
thing that counts is quality,” says Taubner.
But lately, customers have also been making
frequent demands for additional production
capacity. If the past was about offshoring
or outsourcing IT-supported services to
low-wage countries, especially in the areas
of programming and routine tasks, companies
are now increasingly looking for service
providers to assume the responsibility
for entire business processes. “Business
process outsourcing” (BPO) is extending into
activities such as financial accounting,
invoicing and procurement,” says Rebecca
Scholl, an analyst with Gartner, the IT market
research company. Central Europe is
becoming more appealing in this regard all
the time. “Many service providers are
building capacity in Prague, Krakow and
Budapest,” says Scholl. These business locations
are all in competition with offshore
providers in India.
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