Global Business Magazine CeBIT 2010

GLOBAL
BUSINESS
› ENTERING NEW MARKETS
MAGAZINE March 2-6, 2010
RISING OPPORTUNITIES
The growing importance
of IT & ICT offshoring
BEYOND BRIC
Offshoring in non-BRIC
countries
INTERVIEW
Alibaba CEO David Wei
on the future of trade
GERMAN IT INNOVATION
Showing ways out of
the crisis
The Global Business Magazine is a publication of the local global GmbH.
CeBIT
FLAT WORLD
OFFSHORING IN
FORUM
HALL 6
STAND C 08
TURBULENT TIMES
IS GLOBAL CRISIS LIMITING OR BOOSTING CROSS-BORDER COOPERATION?
CEBIT 2010 GLOBAL BUSINESS MAGAZINE
EDITORIAL
Connected Worlds
The World is flat. Yes, really; Informa-
tion and Communication Technology
is driving the changes in interconnect-
ed national economies hard. Global
connectivity is, by the same token, the
basis for more and more enterprises,
even small firms, discovering and de-
veloping new business territory.
CeBIT has always held the clearest mir-

ror up to such global trends. The fair
brings both sides together: the major
technological driving forces and the in-
numerable worldwide users of innova-
tion. The essential B2B area at CeBIT
sets the pace at which company proc-
esses are going to change – but this area
also introduces the partners with which
they can tackle the new tasks and, what’s © CeBIT
more, right around the world. Ernst Raue Board member of Deutsche Messe AG
For many countries, CeBIT is the plat-

form for making a showing on the CeBIT issues that are discussed at the and ITIDA our thanks for their sus- present at the CeBIT Flat World Fo-
world market. Their main task is to Flat World Forum in Hall 6 from an tained efforts to bring young enter- rum – Welcome, one and all! I am also
demonstrate the competitiveness of international perspective. prises to CeBIT, and also to UNCTAD sure that we in the Flat World Forum
their locations and the potential of their in Geneva for the study on global ICT can show how closely the world has
industries. The watchword is then not This continues the long and proud services in ‘turbulent times’, print ex- grown together digitally, and I would
simply cost cutting through offshoring CeBIT tradition of mediating contacts cerpts of which will be available here at encourage you, as visitor or exhibitor
and outsourcing, no: new shared crea- in hitherto undiscovered markets. lo- CeBIT Global Business Magazine. at CeBIT 2010, to seize this wonder-
tion of value, developing worldwide cal global is a proven Deutsche Messe ful chance to get acquainted with new
resources, efficient forms of cross-bor- partner as coordinator of the Flat World I’m delighted that companies from partners for your global business right
der cooperation – these are the ‘classic’ Forum. To the organisers SIPPO, CBI Egypt, Macedonia and Vietnam are here in Hanover. ‹
IMPRINT
Published by In Cooperation with Advertisements

local global GmbH Deutsche Messe AG Andreas Bergmaier
Marienstraße 5 Messegelände bergmaier@localglobal.de,
D-70178 Stuttgart D-30521 Hannover Phone +49 711 / 22 55 88-24
Phone + 49 711 / 22 55 88-0 Phone + 49 511 / 89-0
Fax + 49 711 / 22 55 88-11 Fax + 49 511 / 89-3 26 26 Layout
marketing@localglobal.de www.messe.de Olga Lukomska
www.localglobal.de
Concept Forum Programme
Hans Gäng Britta Schulze
Editor Print
Esad Fazlic Bechtle Druck&Service
GmbH & Co. KG
Cover Photo
Istockphoto.com
GLOBAL BUSINESS MAGAZINE CEBIT 2010

3
now !
r
Orde bal.de/shop
lo
.localg
www
��
��
��
��
Keine Tiger in Indien Of Tigers and India

��
��
��
��
��
��
��
��
n.
ern globalisatio
es up to 70%.
horing Diary
become one, have

Reasons for the
ity
cultural divers
and
ts the exciting
le
ecting a suitab
l
India – An Offs
and all the smal

prosperous
hrough months
of
sis,
��
position of analy
��
Of Tigers and
bared’
w, a ‘no holds
The author often
the most famo
us
finds
��
been working
er for several
as IT
global
��
��
sts are
. His main intere
projects,
plex software
Of
g – and
e outsourcin
ia rs and India
book
ndge
and illustrative
Of ITi
nagement diary
!”
O f Tig
e rs and
An
D
y fshoring Diary
iarOf
ring
www.localglobal.de/shop
ffsho
An O
54:56
07 16:
.12.20
CONTENT
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0
Offshoring in turbulent times E-commerce on the rise

0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11
6 IT and ICT-enabled services are growing in world trade. Increased 16 David Wei, CEO of Alibaba, the world’s biggest online B2B-
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1
broadband connectivity in a rising number of countries has facilitated marketplace, talks about the importance of the European market and
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1
the reorganization of the production of many services. Alibaba’s new services

0 1 0 1 1 1 0 0 1 1 0 1for
0 1 1 0small
1 0 1 0 1 1 0 1and
0 0 0 1 0 1medium-sized
0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1enterprises.
0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 1
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0
GLOBAL FLAT
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1
MARKETS 0 1 0 1 1 1 0 0 1 10 01 10 01 1 1 0 10 01 1 0 1 10 01 1 0 01 0 1 0 1 01 0 01 0 10 10 01 10 01 10 0 11
0 001011001101110011
0 10 10 01 10 01 1 1 0 10 01 1 0 1 10 01 1 0 01 0 1 0 1 01 0 01 0 10 10 01 10 01 10 0 11
0 00101100110111
BUSINESS
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0
WORLD
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0
MAGAZINE 6 Offshoring in turbulent times

0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1
FORUM
› ENTERING NEW MARKETS
The growing importance of
March 2-6, 2010
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1
IT & ICT offshoring

RISING OPPORTUNITIES 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1
12 Beyond BRIC
The growing importance
of IT & ICT offshoring 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0
BEYOND BRIC
Offshoring in non-BRIC Offshoring in non-BRIC
countries
CeBIT | 2.3. – 5.3. 2010 | Hall 6 | Stand C08
INTERVIEW
Alibaba CEO David Wei
countries
on the future of trade
GERMAN IT INNOVATION
PROGRAMME
Showing ways out of
the crisis
16 E-commerce on the rise
The Global Business Magazine is a publication of the local global GmbH.
Alibaba CEO David Wei on the 22 FLAT WORLD FORUM - Programme

future of trade 02. - 05. April
CeBIT
FLAT WORLD
OFFSHORING IN
FORUM
HALL 6
STAND C 08
Hall 6, Stand C 08
TURBULENT TIMES 18 Ahead of competition
IS GLOBAL CRISIS LIMITING OR BOOSTING CROSS-BORDER COOPERATION?
Promoting imports from
developing countries PROFILES
EDITORIAL 20 German IT INNOVATION 24 Company profiles

Showing ways out of the crisis The participants, Sponsors and Partners
3 Ernst Raue, Board member of the FLAT WORLD FORUM
of Deutsche Messe AG ACELLERE • ALIBABA.COM • CIKLUM • CONSIM
INTERNATIONAL EVENTS CONSULTING • CURITIBA OFFSHORE CENTER •
GIBC - THE GERMAN-INDIAN BUSINESS CENTER
23 BITS in Brazil • INDE® LAW FIRM • THE INDO-GERMAN SOFT-
Business IT South America - WARE COMPETENCE NETWORK • NIEDERSACHSEN
a CeBIT event GLOBAL GMBH • SIPPO SWISS IMPORT PROMOTION
PROGRAMME • STEFANINI IT SOLUTIONS • SUYATI
• PORTO ALEGRE INFORMATION AND COMMUNICA-
TION TECHNOLOGY COMPANY - PROCEMPA •
UNACORP

5
MARKETS
© Stock Exchange
OFFSHORING IN TURBULENT TIMES

› IT and ICT-enabled services are growing in world trade. Increased broadband connectivity in a rising number of countries has facilitated
the reorganization of the production of many services. Activities that once required face-to-face contact can now be split up into smaller
components, which in turn can be undertaken in places offering the best locational advantages.
The resulting offshoring of services lower cost and focus on activities where evolving. This section starts by review- contribution to world trade, more and
has only just begun but is expected they enjoy a comparative advantage. ing different sources of data to gauge more companies in a growing number
to continue to expand geographically For the exporters of the services, offshor- how offshoring of services was evolving of industries and countries are embrac-
and sectorally as well as across busi- ing can imply the creation of attractive until the current crisis erupted. It high- ing the opportunities created by ICTs
ness functions. Moreover, the process employment opportunities, industrial lights the main industries and countries for the specialization and internation-
is partly irreversible. Once companies diversification, export revenues, knowl- involved by reviewing various sources alization of services. Offshoring of serv-
learn to exploit the opportunities cre- edge transfers and economic upgrading of information. ices occurs in different ways (Table I). It
ated by pooling services and locating (UNCTAD, 2004; ECLAC, 2009). Mean- After discussing the role of ICTs in the can be done internally by moving the
them where they can be most efficient- while, as shown below, new countries context of offshoring, the section turns production from a parent company to
ly produced, they are unlikely to return are emerging on the radar screen as to the implications of the crisis, distin- its foreign affiliates (often referred to
to “traditional” ways of organizing their offshoring locations. Unsurprisingly, guishing between the more immediate as “captive offshoring”). It may also in-
business processes. many governments are now seeking to impacts and longer-term consequences. volve the international outsourcing of
From a development perspective, the design effective policies to boost related The overall picture that emerges is con- services to a third party services provid-
offshoring of services is an attractive exports by local and foreign firms. siderably more optimistic than in the er – domestically or foreign-owned.
proposition with potential benefits for Measuring and understanding offshor- case of ICT goods. The scope of activities that are affect-
all parties concerned. For the global ing are no easy tasks, however. There is ed by offshoring continues to expand.
RECENT TRENDS
economy as whole, it can generate effi- a lack of internationally agreed defini- There is no internationally agreed ap-
ciency gains from international speciali- tions of offshoring and there are many The offshoring of services grew rapidly proach to categorize the kinds of serv-
zation and trade. Importing companies data limitations. An additional chal- during the past decade. While the phe- ices that can be offshored, but it is com-
and countries can access services at lenge is that the phenomenon is rapidly nomenon still accounts for a modest mon to make a distinction between IT
6 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

MARKETS
services and ICT-enabled services (table

II). The latter group covers front office OFFSHORING AND OUTSOURCING
services, back office services and various
Location Internalized production Externalized production (outsourcing)
forms of knowledge process offshoring
(KPO). Some activities relate to specific Domestic Production kept in-house at home Production outsourced to third party
service provider at home
industries while most are generic and
relevant for businesses in virtually all Foreign (offshoring) Production by own foreign affilate Offshore outsourcing to third party
industries. „captive offshoring“ provider abroad
The skills involved range from relative-
ly low levels of qualification (data entry, CATEGORIES OF SERVICES AFFECTED BY OFFSHORING
certain call centres) to very high levels
(research and development, design, Service Category Example of service activities
medical testing and financial analysis).
IT Services Programming, systems integration, application testing, IT infrastructure management
As companies have grown more accus- and maintenance, IT consulting, software development and implementation services, data
tomed to the practice, supplier capabili- warehousing, and content management and development
ties have improved and the quality of ICT-enabled services • Call centres and customer contact centres (inbound and outbound)
the fibre optic network has expanded, Front office services • Data entry, human resources, payroll, finance and accounting, procurement, transcription
the offshoring of services with higher Back office services • Financial analysis, data mining, engineering, research and development, insurance
KPO claims processing, architectural design, remote education and publishing, medical
added value has gradually become more diagnostics, journalism
common (see e.g. KPMG, 2008). The
extent to which different services are
exposed to offshoring varies consider- OFFSHORING MATURITY LEVELS OF DIFFERENT SERVICE ACTIVITIES, selected examples
ably. Offshoring of traditional IT serv-
Level of maturity Examples of services Level of maturity
ices such as programming and appli-
cations development are approaching Already reaching IT services, such as programming and • Decelerating adoption rates but continu-
a high level of maturity (table III). To- maturity application development and maintenance ed growth in scope
• Clearly established players and locations
day, companies considering offshoring • Accepted business models and standards
these services can choose among many
suppliers and locations, and the growth Emerging • Customer contacts • Accelerating adoption rates and
rapid growth • Infrastructure management increased scope and scale penetration
in adoption rates has started to taper off. • Finance and accounting • Suppliers becoming established
Most business processes are found at • Human resources • Market consolidation
an earlier stage of offshoring maturity, • Remote infrastructure monitoring • Location options with varying
• Knowledge services characteristics increasing
experiencing fast growth as more and • Fewer, better established models
more companies are still exploring the leading to lower risk in choosing the
opportunities that offshoring can offer. appropriate design
Among these functions, customer con- Pioneer Stage • Procurement • Untapped value proposition, early
tact services are the most mature, and • Legal process offshoring but few adopters
• Limited number of suppliers
knowledge services the least. The third
in few locations
stage comprises functions that are only • Multiple business models
just emerging as candidates for offshor- and unclear standards
ing, including, for example, procure-
ment and legal process services. Source: UNCTAD, based on information from Everest Research Institute, April 2009.
Within the worldwide spending on
technology products and related servic- ing the period 2004–2008, for example, earlier (table IV). However, as these “captive solutions” (i.e. services under-
es, IT services represent the largest seg- the value of IT and ICT-enabled serv- numbers do not include cross-border taken in-house in a foreign location)
ment. Market analysts estimate global ices sourced in a foreign location grew sourcing, occurring among the high- tend to be more important in the case
spending on IT services in 2008 to be more than three times faster than the income countries, they underestimate of ICT-enabled services than in IT serv-
worth about $557 billion, and spend- overall growth in outlays related to such the total value of offshoring. In 2008, ices (Boston Consulting Group, 2007).
ing on business processes outsourcing services (ibid.). Global exports resulting the market share of IT services was es- In India, for example, local service pro-
some $115 billion (IDC, 2008). While from the offshoring of IT services and timated to be about 60 per cent. viders account for an estimated 70–75
only a small share of these expendi- business processes have been estimated The preferred method of offshoring per cent of the sales of IT services, for-
tures involves international sourcing at $89 billion to $93 billion in 2008, up depends on the type of activity. While eign “captives” for 10–15 per cent and
(offshoring), that part is growing. Dur- from 30 billion to 35 billion five years reliable data are lacking in this area, foreign third party providers also for ›

7
MARKETS
WORLD TRADE IN SERVICES AND IN IT AND ICT-ENABLED SERVICES, 1990, 1995, 2000–2007
(billions of dollars and per cent)
Item 1990 1995 2000 2001 2002 2003 2004 2005 2006 2007
Total Services 826.7 1234.9 1524.0 1529.0 1640.5 1891.5 2288.2 2557.2 2878.1 3410.4
IT and ICT-enabled services 269.0 441.7 648.8 665.7 723.1 856.1 1033.4 1163.3 1354.3 1635.1
IT and ICT-enabled services as % 32.5 35.8 42.6 43.5 44.1 45.3 45.5 45.5 47.1 47.9
of total services
Source: UNCTAD, based on data from IMF. Note: IT and ICT-enabled services include the following categories of services: communication; insurance;
financial; computer and information; royalties and license fees; other business services; and personal, cultural and recreational services.
›
a 10–15 per cent share. In the case of tries are high technology/telecommu- guish between, for example, computer- are developed countries, India had the
ICT-enabled services, the share of lo- nications, manufacturing and retail.26 related services, business services, val- fifth largest, China the tenth largest and
cal Indian providers was estimated to The high proportion of offshoring relat- ue added telecommunications services Hong Kong, China the thirteenth larg-
be about 45–50 per cent, that of foreign ed to financial services makes it partic- and software services. Using the broad est exports in the world.
captives 30–35 per cent and that of for- ularly relevant to consider the implica- definition, world trade in IT and ICT- For countries seeking to promote ex-
eign third party providers 20–25 per tions of the global economic crisis. enabled services amounted to $1.635 ports of IT and ICT-enabled services,
cent (Nasscom, 2009). trillion in 2007 (table V). Between 2000 the quality of the ICT infrastructure is
BALANCE OF PAYMENT DATA
In countries with less developed local and 2007, such services grew in impor- important. Whereas in the early days
supplier capabilities than India, the Official statistics on trade in services are tance as a share of total services trade of offshoring, relatively few locations
relative importance of foreign affiliates compiled by the International Monetary – from 42.6 to 47.9 per cent. The Unit- could offer acceptable connectivity, the
(captive or third party providers) is of- Fund (IMF) balance-of-payments data. ed States was by far the largest export- spread of ICTs has allowed many more
ten considerably higher. For example, Using such information to examine the er of such services in 2007; its exports countries to be seen as potential desti-
even in a mature location such as the offshoring of services has both benefits amounted to $270 billion (table VI). nations. Today, good ICT infrastructure
Philippines, foreign companies account and limitations An advantage is that The United Kingdom was a clear sec- is regarded as a necessary but not suf-
for the bulk of ICT-enabled services data are available for a large group of ond. While most of the top 15 exporters ficient condition to attract export-ori-
exports. It is estimated that in 2008, countries. A limitation is that balance
around 90 per cent of such exports re- of-payments data do not distinguish
ported to the Board of Investment was between the different modes of servic-
accounted for by foreign companies.25 es supply, making it difficult to isolate
In South Africa, more than half of all trade flows that are related to cross-bor-
Global market for offshoring, 2004-2008
employees working with exports of der supply facilitated by ICTs.28 Anoth-
(billion of dollars)
business process services for the finan- er disadvantage is that they do not spe-
20-23
cial sector worked for foreign-owned cifically identify “IT services” or “ICT-
companies (Everest Research Insti- enabled services”. Balance-of-payments
tute, 2008c). Similarly, in many loca- data can be seen as an upper limit for
70-76
tions in Latin America and the Carib- any estimated value of offshored serv-
20-23
bean, foreign companies dominate. ices (WTO, 2005).
For example, a 2009 survey found their In this report, the same definition of 47-51 54-56
share of jobs related to the offshoring trade in IT and ICTenabled services is
44-47
of business services to be 59 per cent used as in previous Information Econ- 37-40
in Honduras, 63 per cent in Saint Lu- omy Reports (see UNCTAD, 2002a and 20-23
30-32
cia, 82 per cent in Saint Vincent and the 2006b). Accordingly, the following cat- 20-23 26-29
Grenadines and 90 per cent in El Salva- egories of services are included: com- 22-25
10-12 17-19 35-37
dor (ECLAC, 2009). munication services; insurance serv-
The use of offshoring varies also by in- ices; financial services; computer and 2004 2005 2006 2007 2008
dustry. Financial services companies information services; royalties and li- Business process offshoring (ITO)
have been the leaders in this area, ac- cense fees; other business services; and Information technology offshoring (ITO)
counting for an estimated 40–45 per personal, cultural and recreational serv-
cent of the global offshoring market ices. One reason for such a broad defi- Source: UNCTAD, based on information from the Everest
(Everest Research Institute, 2008c: 20). nition is technology convergence. It has Reseach Institute.
Among the next most important indus- become increasingly difficult to distin-

MARKETS
© CeBIT
ented services projects. When assess- in an offshore location, the equivalent ations to rely on satellite connections. activity. This applies especially to servic-
ing the ICT infrastructure, the quality threshold is typically 99.9 per cent. Re- Finally, the cost aspect is important. The es offshored by the financial industry, in
and costs of international telecommu- quirements are particularly strict for two main cost items are wages and con- which some companies may disappear
nication connectivity are particularly certain types of services. For remote IT nectivity costs. When connectivity costs altogether. On the other hand, as the
important, although requirements vary infrastructure management, extremely are kept relatively high by local tele- recession adds pressure on companies
for different services. high standards are required, and only com operators, it can slow the growth across industries to reduce production
With regard to international telecom costs, some will choose to source more
Global exports resulting from the

connectivity, companies look for re- services, and new services, from lower
dundancy in bandwidth, i.e. multiple cost locations. In the longer term, and
providers or cables supporting inter-
national connectivity. Rather than a
offshoring of IT services have been as the global economy recovers, both
the volume and the scope of offshoring
country-level minimum threshold, re-
quirements centre on whether there is
estimated at $89 billion in 2008. are likely to grow significantly.
The analysis in this section draws on
redundancy and if there are multiple field research, media reports and infor-
providers supporting bandwidth deliv- locations with very reliable infrastruc- of services exports and/or reduce the mation presented by leading companies
ery. For example, Costa Rica was already ture can be considered. For voice-based scope for paying higher compensation in the industry. It examines the imme-
supporting offshore services when it services, reliability is also important but to employees. diate impact as well as the medium-
had only one fibre optic bandwidth pipe less critical than in the case of remote and longer-term growth prospects to
IMPLICATIONS OF THE CRISIS
into the country. This has since devel- IT infrastructure management. In the expand the scale and scope of offshor-
oped and there are now multiple pipes case of voice-based customer contact Exporters of IT and ICT-enabled serv- ing to new business segments and ge-
into the country. centres, it is difficult to rely on satellite ices appear to have weathered the glo- ographies. Special attention is given to
When considering the quality of inter- technology, as latency becomes an is- bal economic crisis considerably better developments in India as it is the largest
national telecom connectivity, compa- sue, which in turn means that fibre op- than ICT goods exporters. One reason developing country exporter of IT and
nies typically look at various reliability tic links are usually required.38 Given for this is that companies see offshoring ICT-enabled services. When this report
metrics (such as extent of down time) the importance of fibre optic connectiv- of services as one way to reduce their was prepared, there was still considera-
to assess the stability and quality of the ity for voice-based services, the spread production costs and enhance their ble uncertainty with regard to the depth
infrastructure available. For example, in of submarine cables in Africa should competitiveness. In the short term, the and longevity of the global economic
the United States, quality of connectiv- make more countries potentially inter- volume of offshoring of services is in- down-turn. Moreover, the availability of
ity is often required to be high enough esting as locations for contact centres. fluenced by two opposing forces. On the official data for recent months is gen-
to ensure that the service can be deliv- For data traffic, there can be more flex- one hand, services exports may decline erally limited, which means that the
ered up to 99.999 per cent of the time; ibility, making it possible in certain situ- due to a general slowdown in economic analysis has to rely on private sector ›

9
MARKETS
›
market estimates and forecasts. Thus, lowed in October–December 2008 by a the short term included benchmarking to occur in the second half of 2009 or
predictions of future outcomes should slowdown in revenue growth, but both offshoring contracts, closer scrutiny of early 2010. Many buyers who delayed
be regarded as tentative. revenue and employment continued to service provider invoices, assessments contracts as an immediate reaction to
grow. This first phase was characterized of service provider performance and the global economic crisis will find it
SHORT-TERM AND LONG TERM
by increased caution among buyers. The evaluations of current offshore sourc- increasingly difficult to postpone deci-
EFFECTS DIFFER
issuing of new major services contracts ing locations to determine whether oth- sions any further, resulting in new con-
The prospects for the modalities of con- was basically frozen and some contracts er centres might be more advantageous tracts (Mitra, forthcoming). Moreover,
tinued exportoriented growth in IT and were cancelled altogether. Buyers of IT (Lewin et al., 2009). In India, there have greater pressure to cut costs and the ma-
ICT-enabled services are being re-exam- and ICT-enabled services held back on been examples of buyers cancelling or turing of existing as well as new appli-
ined in the light of the global economic discretionary spending but less so on postponing new offshoring contracts cations may imply that many firmswill
downturn. Most firms are facing a de- services related to maintenance. A No- due to budget cuts, and some have consider expanding the scale and scope
celeration of growth in demand, but op- vember 2008 survey of 100 companies sought to renegotiate existing agree- of their offshoring activities.
timism appears to prevail regarding the based in the United States found that ments. In fact, some of the slower rev- Given the current focus on cutting costs,
long-term prospects for the IT and ICT- the crisis made labour costs savings an enue growth among vendors in India more firms in the developed countries
enabled services industry. even more important objective for off- reflects increased pressure by buyers to may be expected to expand their off-
As the impact of the global economic shoring. Otherwise, companies in the cut billing rates. Billing rates have de- shore operations in the medium and
slowdown has slowly started to become survey did not predict significant chang- clined by 5–30 per cent as a result of re- long term. For companies in industries
clearer, projections for spending on IT es to their offshoring plans and strate- negotiations of old contracts or the issu- with limited experience with offshor-
and ICT-enabled services have gradual- gies (Lewin et al., 2009). ing of new ones (Gartner, 2009). ing, the crisis may act as a trigger for
ly been revised downwards. IT organi- By early 2009, companies had started Several market analysts forecast that the them to explore the opportunities pro-
zations worldwide are trimming their to take action to limit the effects of the export revenue growth of IT and ICT- vided by sourcing services from abroad.
budgets and cutting back on discretion- crisis, mainly with a view to reducing enabled services will rebound relative- According to some studies, the greatest
ary spending. costs. According to the survey of United ly quickly. At the time this report was potential for more offshoring is likely to
The speed and severity of the response States companies, actions considered in prepared, the rebound was expected be in health care, retail, retail banking,
by businesses and consumers alike to
these economic circumstances should
result in a market slowdown in 2009
that will be worse than the 2.1 per cent
decline in IT spending in 2001 when
the “dot com” bubble ended. In the short
term, reduced spending on ICT should
have a chilling effect on the demand for
offshoring. In India, for example, prior
to September 2008, exports of IT and
ICT-enabled services were projected to
grow by 21–24 per cent in 2008/09 in
dollar terms; by February 2009 this es-
timate had been reduced to a 16–17 per
cent growth rate reflecting substantially
lower growth in export earnings from
October 2008 to March 2009 (Nasscom,
2009). Other analysts agree that growth
in IT offshoring will remain moderate
in 2009 and 2010, and that economic
uncertainty, increased competition,
price cuts in smaller projects and reces-
sion will continue through the first half
of 2009, with revenues starting to im-
prove in the second half of 2009 and in
© DMAG
2010 (Forrester, 2009).
Given the current focus on cutting costs, more firms in the developed countries may be expected to expand their offshore
The effects of the crisis on corporate
operations in the medium and long term.
behaviour will evolve over time. In In-
dia, the eruption of the crisis was fol-

MARKETS
ICT and insurance industries (ECLAC, offshore (section III.B.1). Consequent- nificantly affected by the slowdown in- ment of a strategy to get out of the cur-
2009). Existing users of offshoring as ly, the strategic responses by banks, include travel, retail, telecommunication, rent crisis. Some predict that, while the
well as new ones are also likely to show surance companies and other financial manufacturing and engineering serv- more established companies are well
increased interest in sourcing a wider services significantly influence the over- ices. Less affected industries include IT supplied with liquidity and may see the
range of business functions in order all impact. In 2008, the total value of out- and ICT-enabled services for the health current crisis as an opportunity to reap-
to reduce costs. In the medium to long sourcing deals involving financial serv- sector and public administration. praise their operations, smaller com-
run, this should translate into larger vol- panies may be more affected. SMEs
umes of offshoring activity. When the typically have fewer clients and often
economic cycle eventually improves, a depend more on service niches char-
surge in IT and ICT-enabled services Top 15 exporters of IT and ICT-enabled services, 2007 acterized by a relatively high degree of
exports can be expected. By then, more (billions of dollars) discretionary IT spending, i.e. expendi-
companies will have been exposed to tures that have been cut back the most
United States
offshoring. - during recent months. Moreover, small-
United Kingdom er suppliers are often more exposed to
EFFECTS VARY BY SEGMENT - the volatility of demand, exchange rates
Germany
Some segments of the offshoring in- - and the credit crunch. But it is diffi-
dustry in India appear to have been Ireland cult to generalize with regard to the
more affected than others. In the case - impact on large versus smaller firms.
India*
of IT services, non-discretionary serv- - In summary, long-term growth pros-
ices such as mandatory operations and Japan pects for the offshoring of IT and ICT-
maintenance have been less affected - enabled services are promising for early
Luxembourg
than discretionary services such as con- - starters (such as India) as well as many
sulting. Similarly, application develop- France other emerging locations. As the global
ment work has been more affected than - offshoring business is poised to grow,
Netherlands
application management. While com- - there should be room for more coun-
panies have been reluctant to upgrade China tries to develop a sizeable export-ori-
or attempt to develop new applications, - ented services industry if they can meet
Switzerland
application management and main- - companies’ needs for complementary
tenance are essential services that are Italy assets in terms of skills and time zones.
more difficult to scale down. In the case - The scope of industries and business
Hong Kong (China)*
of ICT-enabled services, a mixed picture - functions that become subject to off-
emerges. Some vendors have been se- Spain shoring is also expected to expand in
verely hit and others less so. Again, dis- - the longer term. A recent assessment of
Belgium
cretionary spending has been the most the long-term prospects of the offshor-
| | | | | |
affected. This may imply more negative 0 50 100 150 200 250 ing industry suggest that as much as 80
effects for front office (customer care/ per cent of its incremental revenue un-
marketing) services than for back of- Source: UNCTAD, based on data from the IMF. til 2020 is expected to come from new
fice services (e.g. accounting, human Note: * The 2007 export values for India and Hong Kong, China are estimates. The values industries (such as the public sector,
resources, and payroll), although da- were derived based on the growth rate for “other services” between 2006 and 2007. health care, media and utilities), cus-
ta to confirm this have yet to emerge. tomers (especially SMEs) and countries
Knowledge process offshoring, includ- ices dropped by 28 per cent to its low- All of these business segments, includ- (Nasscom and McKinsey. 2009). ‹
ing research, product development and est level since 2001 (TPI, 2009). Some ing banking, financial services and
engineering, appears to have been badly observers believe that financial institu- insurance, are, however, expected to
affected as companies have cancelled or tions in Europe and the United States resume growth as the global economy INFO
delayed related work both at home and reduced their volume of newly awarded recovers. Some indications, especial- This article contains excerpts from
offshore. Many firms will eventually outsourcing contracts by nearly 30 per ly for the medium or long term, paint the „Information Economy Report
commit to offshore more work in this cent in 2008 compared with 2007. In quite a positive picture. Some forecast 2009“, which is published by the
area as such investments are essential India, banking, financial services and that offshoring of business processes United Nations Conference on Trade
to ensure their future competitiveness. insurance have remained the largest by financial services companies will in- and Development (UNCTAD).
The effects of the crisis also vary be- industry segment for IT and ICT-ena- crease an impressive 25 times its cur-
tween industries. As noted above, the bled services exports, accounting for 41 rent market size over the next five years. The report can be fully downloaded at:
financial services industry accounts for per cent of all such exports in 2008/09 Moreover, for some major financial www.unctad.org/en/docs/ier2009_en.pdf
the largest share of services sourced (Nasscom, 2009). Other industries sig- groups, offshoring may form one ele-

11
MARKETS
The nearshore geography of globalising IT and business services
 
Estonia, Latvia, Poland, Hungary, Czech.
Rep., Slovakia, Croatia, Russia
Canada
  EU13+No.+Swit.
 
Lithuania
Serbia, Slovenia, Bulgaria,
Romania
Ireland Armenia,
Ukraine,
Belarus
USA



Spain
Algeria
Tunisia
Bahamas Egypt
Mexico
Guatemala Jamaica
El Salvador Dominican Rep.
Nicaragua Puerto Rico
Costa Rica Barbados
Panama
Honduras
Colombia
Guyana
Venezuela
Peru
Brazil
Chile
Uruguay
Argentina
South Africa
Client cluster
in West Europe
Client cluster
in North America
BEYOND BRIC
› While it is common to talk of Brazil, Russia, India, and China as the BRIC inheritors of globalisation, by 2009 there were over
120 other active offshore locations offering IT and business process services or captive locations for these. All this raises the
question: to what extent are non-BRIC countries also potential inheritors of globalisation?
TEXT: PROF. LESLIE WILLCOCKS, CATHERINE GRIFFITHS, DR JULIA KOTLARSKY LONDON SCHOOL OF ECONOMICS
The global offshore outsourcing market tively. Although the BRIC countries has increased each year since 1992. is likely to grow worldwide by 10% to
for IT and business services exceeded are still maintaining a leading position, Back in 1989, global ITO was a $9–$12 15% a year, from $140 billion in 2005
$55 billion USD in 2008 and some es- they are not without their problems, billion market. In 2008, the global ITO to potentially $230 billion plus by 2013.
timates suggest an annual growth rate with Brazil and China hardly leverag- market was estimated to be worth be- BPO expenditure will be in areas such
of 20% over the next five years. In 2008, ing their potential and Russia lacking tween $220 and $250 billion. The BPO as the human resource function, pro-
India posted some 65% of the ITO and governmental support. India and China market in 2008 was less than the ITO curement, back-office administration,
43% of the BPO market. may even be seen turning to non-BRIC market, but grew at a faster rate. Based call centres, legal, finance and account-
Indeed, in 2008 India exported $40 locations for some of the solutions; for on the evidence, the estimate for the ing, customer-facing operations, and
billion of such services, while China, example, to secure low cost and labour ITO market, over the next five years, asset management. Offshoring and
Russia, and Brazil managed $5 billion, availability. The global market for Infor- is that it will grow by 6–9% per annum outsourcing will retain their criticality
$3.65 billion, and $800 million respec- mation Technology Outsourcing (ITO) while mainstream BPO expenditure through recessionary as well as growth

MARKETS
Japan
Offshoring-costs comparison for 14 non BRIC countries*

 Korea
 5.0 - ---------------------------------------------------------------------------------------------------------------
4.5 - ---------------------------------------------------------------------------------------------------------------
Level of attraction of country by cost

4.0 - ---------------------------------------------------------------------------------------------------------------
3.5 -----------------------------------------------------------------------------------------------------------------
3.0 ------- ---------------------------------------------------------------------------------------------------------
2.5 -----------------------------------------------------------------------------------------------------------------
China
2.0 -----------------------------------------------------------------------------------------------------------------
1.5 -----------------------------------------------------------------------------------------------------------------
1.0 -----------------------------------------------------------------------------------------------------------------
Malaysia 0.5 --------------------------------------------------------------------------------------------------------------- -
 0-
Belarus
Costa Rica
Czech Republic
Bulgaria
Egypt
Singapore
Mexico
Marocco
Philippines
Poland
Romania
Slovakia
Tunisia
Venezuela
Vietnam
* The country scores indicated in Table 1 range from, 1=very poor,
2=poor, 3=average, 4=good, 5=excellent
Client cluster This scoring system is used for all subsequent tables.
in East Asia
ents. Where clients move to a primary shoring include less travel costs, less five years. Evalueserve estimated that
LEGEND
contractor model, the leading supplier time zone differences, and closer cul- the KPO market in 2007 was $3.05 bil-
 Client Location only (4) may well draw upon attractive offshore tural compatibility. Non-BRIC locations lion and would grow annually by 39%.
Nearshore only (45)
  locations and services in a way that the can profit from nearshoring advantag- It expected the KPO market to be $16
Both client, offshore, client might not choose to do if directly es in their specific regional cluster, dif- billion by 2010 or 2011, employing ap-
nearshore destination (6)
responsible for all suppliers. ferentiating themselves from farshore proximately 350,000 professionals glo-
suppliers on proximity criteria, while bally. KPO should be an ambition for
BRIC WITH NEW CHALLENGES
differentiating themselves from other non-BRIC locations in terms of moving
India, and to a lesser extent China, Bra- nearshore contenders on a suitable mix offshoring and outsourcing work up
periods. A highly competitive global zil and Russia are already experiencing of superior cost, skill availability, quality the value chain, and in terms of differ-
services market presents opportunities upward pressure on wages, combined of infrastructure, government support, entiation and finding profitable market
and revenues for those able to offer the with rising, sometimes high, labour and risk profile. At the same time non- niches. Similarities in areas such as lan-
right mix of strong cost, reliable service, turnover rates; what has been called BRIC providers of services and location guage, culture, and legal and regulatory
and secure location(s). the ‘war for talent’ is escalating in BRIC need to be alert to bestshoring strategies frameworks can make a location more
countries. For example, both India and of foreign clients and suppliers alike. attractive to specific clients, suggesting
MULTI-SOURCING
China are increasing their own offshor- a high level of granularity is needed in
KNOWLEDGE PROCESS
Multi-sourcing has always been the ing of IT and BPO work to other coun- identifying the right client and knowl-
OUTSOURCING
dominant practice and the overall tries. This trend opens up the market edge work to invest in.
growth is driven by client organisations for non-BRIC lower-cost services as a Knowledge process outsourcing (KPO)
COUNTRY ATTRACTIVENESS – KEY
signing more contracts with more sup- stepping stone to evolving into higher- is the outsourcing of business, mar-
FACTORS AND ASSESSMENT
pliers. However, while multi-sourcing value work. ket, and/or industry research. KPO
helps clients to access best-of-breed requires a significant amount of do- Companies considering outsourcing IT
NEARSHORING – A STRONG
suppliers and mitigates the risks of remain knowledge and analytical skills. or business processes typically compare
TREND
liance on a single supplier, it also in- KPO suppliers design surveys, collect a range of costs including:
creases transaction costs for managing ‘Nearshoring’ is defined as outsourcing new data, mine existing data, statisti- › Labour costs (average wages for skilled
more suppliers. Multi-sourcing strate- work to a supplier located in a lower- cally analyse data, and write reports. Al- workers and managers)
gies and shorter contracts offer regular wage foreign country close in distance though the KPO market was, in 2008, › Infrastructure costs (unit costs
opportunities for offshore locations and and/or time zone. Compared with off- quite small, industry analysts expected a for telecom networks, Internet
services to establish footholds with cli- shore outsourcing, the benefits of near- huge growth in this sector over the next access and power, office rent) ›

13
MARKETS
Environment comparison
5.0 - ---------------------------------------------------------------------------------------------------------------
4.5 - ---------------------------------------------------------------------------------------------------------------

4.0 - ---------------------------------------------------------------------------------------------------------------
3.5 - ---------------------------------------------------------------------------------------------------------------
3.0 - ----- ---------------------------------------------------------------------------------------------------------
2.5 - ---------------------------------------------------------------------------------------------------------------
2.0 - ---------------------------------------------------------------------------------------------------------------
1.5 - ---------------------------------------------------------------------------------------------------------------
1.0 - ---------------------------------------------------------------------------------------------------------------
0.5 ---------------------------------------------------------------------------------------------------------------
- -
0
Belarus
Bulgaria
Costa Rica
Czech Republic
Egypt
Mexico
Marocco
Philippines
Poland
Romania
Slovakia
Tunisia
Venezuela
Vietnam
Market potential comparison

5.0 - ---------------------------------------------------------------------------------------------------------------
4.5 - ---------------------------------------------------------------------------------------------------------------
4.0 - ---------------------------------------------------------------------------------------------------------------
3.5 - ---------------------------------------------------------------------------------------------------------------
3.0 - --------------------------------------------------------------------------------------------------------------- The costs considered were a combina-
2.5 - --------------------------------------------------------------------------------------------------------------- tion of start-up, infrastructure, and la-
2.0 - --------------------------------------------------------------------------------------------------------------- bour costs. The 14 countries investigat-
1.5 - --------------------------------------------------------------------------------------------------------------- ed show a wide range of salary scales,
1.0 - --------------------------------------------------------------------------------------------------------------- with the highest being in Central and
0.5 ---------------------------------------------------------------------------------------------------------------
- - Eastern Europe (CEE). Labour costs in
0 Morocco are higher than in Tunisia and
Belarus
Bulgaria
Costa Rica
Czech Republic
Egypt
Mexico
Marocco
Philippines
Poland
Romania
Slovakia
Tunisia
Venezuela
Vietnam
Egypt but lower than in CEE and about

half the costs of white-collar employ-
ees in its major market of France. In
Tunisia, operation costs are about 20%
lower than in Morocco. In Egypt wages
are about half of those in Morocco, and
property prices for offices in business
parks (called ‘Smart Villages’) are sig-
›
› Corporate taxes (tax breaks and reg- nificantly lower than in CEE while be-
ulations, and other incentives for lo- ing on a par with those in Asia (e.g. the
cal investment) across potential out- Philippines).
sourcing locations. In addition, they
INFO are now also looking at value-added
AVAILABILITY OF SKILLS
This article contains excerpts from the report „Beyond BRIC - Off- dimensions for how they might ben- This factor covers:
shoring in non-BRIC countries: Egypt – a new growth market“. The efit over time › Skill pool (size of labour pool with re-
report has been commissioned by Hill & Knowlton. The work has Based on a perception analysis carried quired skills) which include technical
been undertaken by the Outsourcing Unit at the London School of out amongst 18 international consult- and business knowledge, manage-
Economics and Political Science (LSE). ants/analysts, Egypt was considered the ment skills, languages, and ability to
most attractive country based on costs. learn new concepts and innovate

MARKETS
EGYPT – A NEW GROWTH

MARKET
Egypt offers a distinctive business proposition for companies
interested in outsourcing,nearshoring or offshoring. This
positioning is based on a combination of its strengths.
› Labour scalability: Egypt is actively en- nies in Egypt, for example, ITS, have
suring a constant supply of resources established their own academy for
at competitive costs. graduates to help bring in the skills
› Linguistic skills: Egypt offers a great they need.
variety of languages that are spoken › Call centres: Egypt is already an at-
with little or no accent (a distinctive tractive call/contact centre destina-
skill profile, only available elsewhere tion for large multi-nationals with
at a premium). multi-lingual clients around the
› Cultural fit: Egypt has better relation- world. Competition in this is grow-
ships and a better cultural fit with ing from such countries as the Phil-
Western European countries than ippines and Morocco. In the Philip-
many other Arab-speaking coun- pines there are currently 124 major
tries. contact centres, and 198,000 full-
› Nearshoring: Egypt offers a conven- time employees working for compa-
ient, cost-effective destination for nies such as Dell, AOL, J P Morgan,
© Hannover Messe ‘nearshoring’ for European compa- Siemens, HSBC, Shell, Citibank,
nies. The small time zone difference and many others. The Philippines
with European clients is similar to has 380,000 graduates each year
that in CEE countries where costs are (slightly more than Egypt), 15,000
› Vendor landscape (size of local sector › Business environment (compatibility higher. of them focused on technology (less
providing IT services and other busi- with prevailing business culture and › University links: Egypt has begun en- than in Egypt). The main difference
ness functions) ethics) couraging large foreign companies in the skills is the variety of lan-
The skills perception analysis places › Living environment (overall quality of and top universities to build stronger guages on offer by Egypt. Based in a
Egypt with the highest level of skills life, serious crime per capita) relationships. Some of these compa- former US colony, call centres in the
availability, coming ahead of the Phil- › Accessibility (travel time, flight fre- nies already take the best graduates Philippines mainly provide services
ippines. As has been referred to, this quency, time difference) and help to customise teaching pro- in English. Therefore, the Philip-
perception is grounded in the fact that In terms of the business environment, grammes to develop the required pines’ past relationship with the US
Egypt has the capacity to produce an CEE countries are attractive destinations skills. However, similar advantages plays to its advantage. Egypt is work-
annual supply of good-quality gradu- for European companies looking to out- are available in many countries inves- ing hard to attract various markets
ates with multi-lingual skills. It is this source or offshore (or rather nearshore) tigated. Therefore, it is simply becom- (French-speaking, German-speak-
breadth of linguistic ability on top of business processes or ervices. Cultur- ing mandatory to do this. In order to ing and Spanish-speaking as well
the technical supply that is extremely ally, these countries provide a good fit speed up this process, some compa- as others).
attractive to international companies with Western European cultures. Egypt
and puts Egypt ahead of other coun- is positioning itself as a gateway to com-
tries with more qualified technical municate with the growing markets of
skills. other Arab-speaking countries, yet is
Mexico has also been rated highly be- ideally positioned to operate on Euro- › As an outsourced operation using lo- Mediterranean, European, African,
cause of its proximity to the USA, and pean timescales as well as Mediterra- cal IT service suppliers and Arab countries. This potential is
its good education in business skills nean and African timeframes. › As an ITO/BPO supplier to organisa- only now becoming available and ana-
and the Spanish language. Market potential here refers to a coun- tions based in the host country and lysts and businesses see this as a real
Environmment factor covers: try’s future attractiveness as an offshore nearby region opportunity to expand markets and de-
› Government support (policy on for- location for IT and business services. Egypt has scored highest on market po- velop new services based on the strong
eign investment, labour laws, bureau- This may take one or more forms: tential of all the countries. This is be- educational and linguistic skills of the
cratic and regulatory burden, level of › As a captive operation using local la- cause of its unique geographical posi- population. The issue is how to convert
corruption) bour, infrastructure and resources tioning, which means it can work with the potential into large-scale growth. ‹

15
MARKETS
› Why should purchasers consider

Alibaba as an option in doing busi-
ness world wide?
For entrepreneurs and small to me-
dium sized business owners with lim-
ited or no budget, e-commerce plat-
forms like Alibaba.com can serve as
a one-stop shop for establishing their
presence on the Internet, identifying
potential trading partners, accessing
trade resources, and interacting with
other members of the business com-
munity. We make global sourcing
available 24/7 and remove barriers of
geographies and time zones.
Buyers can use Alibaba.com to view
supplier storefronts and product listings
in more than 40 industry categories and
over 3,500 product categories by key-
word searching or browsing through
our online industry directory. They can
also list their specific requirements as
buying leads or subscribe to Trade Alert
to get the most current product infor-
mation matching their requests. This
provides small business buyers with
a chance to source customized goods
and services that help make their small
business dreams come true.
› How do you see the European

market and what is your strategy
for Europe?
Europe is one of Alibaba.com’s top
markets and a high-growth region for
us. We have a very solid base of more
than 1.5 million registered users in
the European Union including over
120,000 registered German users as of
September 30, 2009, with about 48,000
© Alibaba
new companies from the EU signing
up every month last year.
We already have a strong group of fol-
GLOBAL FUTURE OF TRADE lowers in Europe, but we want to fur-

ther raise our brand awareness here,
so that more local small businesses
can benefit from our e-commerce of-
› Trade in the 21st century has rapidly moved towards electronic commerce. Popular e-trading platforms ferings. We are looking to partner with
have been on the rise for the past few years and are increasingly being seen as an efficient option for more trade show organizers, associa-
conducting international procurement. David Wei, CEO of Alibaba, the world’s biggest online B2B- tions, chambers and government or-
marketplace, talks about the importance of the European market and Alibaba’s new services for ganizations so as to provide more local-
small and medium-sized enterprises. ized services, improve the satisfaction
level of our European members and
INTERVIEW: ESAD FAZLIC expand our local business.

MARKETS
› Are European SMEs as open to ices to our members. We have a dedicat- › How can Alibaba contribute › Alibaba is often seen as competitor
international e-business as the ed buyer service and development team to the success of international to trade fairs rather than a partner.
Asian or US firms are? that matches large companies with qual- trade fairs and events? Do you see any future cooperation
Any type of traditional businesses tends ity suppliers from our member base who Alibaba.com is the global leader in options – and what kind of?
to be hesitant about adopting e-com- can fulfill their sourcing needs, and we B2B e-commerce with 10.5 million We see ourselves as complimentary to
merce. We think this is no different in
Europe, Asia or the US. But based on
our experience, once small businesses
come to understand the value of e-com-
merce, they will embrace this new way
of doing business. One of our focuses
this year is therefore to reach out to more
small businesses through partnerships
and educate them about the benefits of
online sourcing and marketing.
› Will Alibaba offer any new serv-

ices, especially for European
customers/buyers? What about
AliEurope?
Alibaba.com beta launched a new serv-
ice called AliExpress on our interna-
tional marketplace in September 2009.
It is a wholesale platform which allows
people to make small bulk purchases
of ready-made products from our sup-
plier members and pay with an escrow
service powered by our sister company
Alipay. For buyers, this can serve as an “We see ourselves as complimentary
express channel to purchase products at
factory prices, while the Alipay escrow to trade shows.”
service can give them an additional level
of security. This year, we will keep listen-
ing to our users’ feedback to this new © Alibaba
beta service and enhance the platform
so as to increase the number of product
listings and build up the user base. put them in touch through our offline registered users from more than trade shows. Alibaba.com works with
In addition, we will also focus on en- sourcing events. To date, we have assist- 240 countries and regions on our in- trade show organizers to help them at-
hancing the user experience of our ined more than 150 international buyers ternational marketplace as of Septem- tract more visitors to their events while
ternational marketplace and further in- such as Wal-Mart, Home Depot and Car- ber 30, 2009. giving our members additional offline
creasing safety in trading. We won’t rule refour in finding the right suppliers. We regularly promote different inter- marketing and sourcing opportunities
out launching a platform specific to our We also have a trade show partnership national and regional trade shows on to complement their e-commerce ef-
European users in the future. When we program which unites the online and of- our platform, and this can help trade forts. We do not see ourselves as com-
grow the market to a certain size and if fline trade communities to provide glo- show organizers attract more visitors petition to trade show organizers or
there is a need for us to spin off a plat- bal buyers and suppliers with more op- from across the world. their electronic platforms. ‹
form for Europe to serve our local cus- portunities to connect and trade.
tomers better, we will do that. We have partnered with some of the
world’s best tradeshow organizers in- INFO
› Will Alibaba go the same way as cluding Kenfair, Koelnmesse and Han- Alibaba on FLAT WORLD FORUM - Hall 6, Stand C 08
other platforms and organize own nover Fairs. This program can benefit Thursday, March 4th, 10:30 - 11:30, Panel: Support for SME in New Markets
sourcing events or trade shows? our users by giving them the best of- > Maggie Choo, Director, International Business Development & Marketing
Alibaba.com’s strength is in facilitating fline marketing and sourcing oppor- (EMEA), Alibaba.com
global and domestic trade through the tunities to complement their e-com- http://tradeshow.alibaba.com
Internet, but we do also offer offline serv- merce efforts.

17
MARKETS
AHEAD OF COMPETITION
WITH IT OUTSOURCING
› As Centre for the Promotion of Imports from developing countries, CBI concentrates on five core competencies: Market knowledge,
Product and production improvement, Quality control, Export marketing and management and Market entry. This cumulative expertise
will also be presented in the CeBIT Flat World Forum 2010.
TEXT: LASZLO KLUCS, CBI SECTOR CONSULTANT FOR SOFTWARE SERVICES & OUTSOURCING
© CBI
CBI brings prequalified, competing, offshore software development companies to Europe.
CBI is an Agency of the Ministry of port Organisations with the purpose of environmental requirements. Require-
Foreign Affairs and part of the devel- increasing exports to Europe. ments are both legislative and market
opment cooperation effort of the Neth- CBI stimulates and supports econom- driven. CBI works with clients who
erlands. ic activities that are sustainable, social- subscribe and strive to comply with
CBI contributes to the equitable eco- ly responsible and environmentally these standards and requirements.
nomic development of selected devel- sound. This implies compliance with
WHAT IS IN IT FOR YOU
oping countries by providing export international social standards, more
marketing and management support to specifically ILO Conventions, and Eu- CBI works together with an exclusive
their SME exporters and Business Sup- ropean consumer health, safety and group of about 60 small, and medium

MARKETS
In hall 6 stand D02, CBI presents ›

15 prequalified companies from
emerging economies.
sized IT companies in a number of

emerging markets - Armenia, Bang-
ladesh, Colombia, Sri Lanka, Philip-
pines, Thailand and Vietnam. CBI
has unparalleled knowledge of these
markets and we also build strong re-
lationships with business support or-
ganizations both in the government
and non-government space of our
© CBI
partner countries. By using the servic-
es, knowledge and network of CBI, the
risks of moving IT processes offshore
to these countries are minimized. Backed up by CBI, IT companies from are very well aware of the importance › Our service offerings to European
CBI has formed very strong and long our partner countries offer great ben- of quality so many of them are companies also include strategy for-
term partnerships with selected IT efits to European businesses by offer- equipped with CMMI or various ISO mulation, outsourcing location selec-
service providers –mostly software de- ing immediate access to a large pool of certifications. tion, service provider evaluation and
velopers in the above countries. The highly educated people and their skills. We know that security, privacy, com- selection, RFP development and dis-
IT service providers we work together The companies have a large combined munication, project management ca- tribution, market research, bench-
with are selected and benchmarked portfolio of technologies across many pabilities, cultural issues, staff turno- marking and policy advice. ‹
very carefully according to European vertical and horizontal markets. We ver and geopolitical risks come high
market requirements. We know our are very confident that European busi- on your list of concerns. The IT serv-
partner companies well. Our partners nesses can find the right partner in ice providers we work together are also
receive extensive assistance, guidance, our network of IT companies regard- well aware of these concerns and with
the assistance of CBI’s coaching and
Our partners provide the much consulting services our partners can
minimize these risks and offer you
CONTACT
needed flexibility and scalability the most comfortable and safe envi-
ronment where you can concentrate
of IT processes to clients in Europe. on what matters most: to get ahead of
competition.
coaching and training from CBI in or- less of the technology or domain ex- Our offer to European companies in-
der to meet the requirements of the pertise you are looking for. terested in offshoring to Armenia, CBI
European market. By using the capacity, capabilities and Bangladesh, Colombia, Sri Lanka, P.O. box 30009
Beside cost advantages and cost re- skills of IT service providers offshore Philippines, Thailand and Vietnam 3001 DA Rotterdam
structuring our partners provide the you can expand your business opera- include: The Netherlands
much needed flexibility and scalabil- tion very rapidly by focusing on your › Access to hard to find market infor- Tel.: +31 10 201 3465
ity of IT processes to clients in Eu- own core competences and at the mation www.cbi.eu
rope. Most of the companies we work same time speed up the time-to-mar- › Access to a unique network of highly Details about the CeBIT presentation
together are specialized, focusing ket cycles. qualified, independently benchmarked on www.get-ahead-of-competition-
on their core competences as well as Quality is our major concern. The and trained IT service providers and with-IT-outsourcing.com
their key business domain knowledge. partner companies in our network business support organizations in.

19
MARKETS
© CeBIT
GERMAN IT INNOVATION:
SHOWING WAYS OUT OF THE CRISIS
› Innovation by Germany’s Information and Communications Technology (ICT) industry is a key to rapid economic recovery. Europe’s
largest market and a propeller of cutting-edge technology, Germany’s IT industry is responsible for 80 percent of German innovations
in all industries.
TEXT: GTAI
Left relatively unscathed by the down- ny has boosted funding for research medical technologies and logistics in-
turn, ICT has continued to perform and development projects. The govern- dustries. With 1,800 patents in 2007,
well worldwide. Germany Trade & In- ment’s High-Tech Strategy supports the Germany was behind only the USA
vest was presenting the latest in ICT in- ICT industry with over EUR 1.5 billion and Japan.
novation at this year’s NASSCOM In- reserved for ICT R&D projects. Over One market segment that is currently
dia Leadership Forum 2010 from Feb- EUR 15 billion is additionally available drawing attention is the so-called busi-
ruary 9 – 11 in Mumbai, India. for project grants and research funding ness process outsourcing and shared
Germany is leveraging its strong po- to further promote innovation. services center (BPO-SSC) sector. With
sition in ICT innovation to boost fu- The ICT industry has an umbrella ef- a 9 percent annual growth rate, it has
ture growth. The industry posted over fect on other sectors, which is evident expanded in recent years to become
EUR 133 billion in revenue in 2008 and in the number of patents the industry one of Germany’s fastest growing ICT
holds 19 percent of the European ICT registers. These innovations contrib- segments. As a result of Germany’s
market. To secure this position Germa- ute to industries such as automotive, highly educated workforce and moder-

MARKETS
ate wage costs, the sector is projecting Selected based on existing leadership
a market volume of EUR 16 billion by and excellence in the field, the program
2012. BPO-SSC opportunities will be aims to create new business opportuni-
one focus of this year’s NASSCOM. ties and contribute to society through
German ICT was recently recognized innovation.
by the European Institute of Innovation Richard Offermann, Director of Serv-
and Technology (EIT). Berlin has been ice Industries at Germany Trade & In-
selected as a co-location for the first vest: „The ICT industry in Germany is
Knowledge and Innovation Commu- highly attractive to investors. It is per-
With a 9 percent annual growth

rate, it has expanded in recent © CeBIT
years to become one of Germany’s

fastest growing ICT segments. for further cooperation in leveraging
projects with an offshore element.“ INFO
For investors looking to enter Europe’s
Germany Trade & Invest is the
nity (KIC) for ICT. The EIT ICT Labs forming well despite the downturn and largest market, Germany Trade & In-
foreign trade and inward invest-
project aims at transforming Europe acts as a reliable motor of innovation. vest will have representatives on hand
ment agency of the Federal
into a knowledge society with an un- German and Indian IT companies are at this year’s NASSCOM. Opportuni-
Republic of Germany.
precedented proliferation of internet- already strong partners. This year’s ties in Germany will be discussed at the
www.gtai.com
based services, establishing partner- NASSCOM is an excellent forum for country panel „Tackling Offshore Chal-
ships between business and academia. us to showcase the latest opportunities lenges in Germany“. ‹

21
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 1
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1
PROGRAMME 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1
FLAT
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0
0 1 0 1 1 1 0 0 1 10 01 10 01 1 1 0 10 01 1 0 1 10 01 1 0 01 0 1 0 1 01 0 01 0 10 10 01 10 01 10 0 11
0 001011001101110011
0 10 10 01 10 01 1 1 0 10 01 1 0 1 10 01 1 0 01 0 1 0 1 01 0 01 0 10 10 01 10 01 10 0 11
0 001011001101110011
0 10 10 01 10 01 1 1 0 10 01 1 0 1 10 01 1 0 01 0 1 0 1 01 0 01 0 10 10 01 10 01 10 0 11
00
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0v
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0v
WORLD
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0v
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0v
FORUM
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0v
0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0 0 1 0 1 1 1 0 0 1 1 0 1 0 1 1 0 1 0 1 0 1 1 0 1 0 0 0 1 0 1 0 0 0 0 1 1 0 1 0 1 0 11 0
CeBIT | 2.3. – 5.3. 2010 | Hall 6 | Stand C08

TUESDAY, 02.03.2010 THURSDAY, 04.03.2010 15:30 - 16:00
Catalonia: Your partner for IC Technologies
13:00 IRRESISTIBLE INDIA 10:30 NEW MARKETS FOR SME > Claudia Jehle, Area Director Invest in Catalonia
Support for Indian companies in Germany 10:30 - 11:30
> Wolfgang Hoeltgen, German-Indian Business Panel: Support for SME on international markets FRIDAY, 05.03.2010
Center > Andreas Luttmann, Deutsche Messe
Best Practice: How to manage business with > Boyko Doytchinov, SIPPO 10:00 NEXT STOP BRAZIL!
German and European companies > Maggie Choo, Alibaba.com Greeting by Dr. Andreas Gruchow, member
> Preet Chandhoke, 01 Synergy > Cora Ziegenbalg, Future Match CeBIT of the board of Deutsche Messe
Software Law in Germany: Law and Practice 11:30 - 12:00 > BITS - Business IT South America
> Oliver Sascha Hartmann, Attorney, Law- InDe® Beat the competition with IT outsourcing Presentations of Brazilian companies:
> Laszlo Klucs, CBI external expert for IT outsourcing > APEX (tbc)
15:00 - 16:30
> Softex/Softsul (tbc)
Company Presentations 12:00 EUROPE AT ITS BEST
Partnerships and Relationships - UNACORP: Your „right shore“ IT provider
12:00 - 14:00 > MSc Eduardo Radziuk, Executive Director,
The next wave in Offshoring:
Nearshoring to Czech Republic: Czech ICT Sector UNACORP
> Harshvir Singh, Drish Infotech
> Jan Fried, Investment Development Manager,
The truth is in the source code Stefanini Company Presentation
CzechInvest - Investment and Business Develop-
> Dr. Andreas Kotulla, Acellere > Leonardo Bruno Melo, Stefanini
ment Agency
Leveraging Unique Global Services from India: In a flat world, you need a round strategy.
I Finding a partner in the Czech Republic
> Mukund Krishna, Suyati Technologies Why Curitiba, Brazil, is a sound choice
II Financial support program ICT and BSS
> Curitiba Offshore
> Eliska Pazdziorova, Sourcing department,
WEDNESDAY, 03.03.2010 CzechInvest - Investment and Business Procempa: A Brazilian E-gov Company
Development Agency > Eberli Cabistani Riella, Procempa
10:30 OFFSHORING AND NEARSHORING
Czech Outsourcing: CN´s 13 succesful years
10:30 - 11:00 13:00 OFFSHORING WITHOUT BOUNDARIES
> Steen Westh Nielsen,CEO, CN Group
Get ahead of competition with IT outsourcing 13:00 - 13:30
> Laszlo Klucs, CBI external expert for IT out- Cooperation possibilities with
Competing successfully with IT outsourcing
sourcing the Czech ICT industry
in a flat world
> Michal Zalesak, Director, Technology
11:00 - 11:30 > Laszlo Klucs, CBI external expert
Platform for IT Services
Nearshore – Smarter Software Development for IT outsourcing
Solution to Permanent Storage Archiving
Outsourcing 13:30 - 14:30
> Heda Polívková, CEO, Northern Star spol. s r.o.
> Steen Westh Nielsen, CEO, CN Group, Czech Outsourcing to Vietnam:
Republic 4 case studies: Major Czech exhibitors
VINASA Vietnam Software Association
at CeBIT & their unique products and services
11:30 - 12:00 Speed Presentations of 5 Vietnamese companies
In 5 steps and 5 weeks to your own Nearshore 14:00 - 15:00 > The North Ltd., VDC Vietnam Data Communica-
team – practical examples from the Danish Near- Outsourcing to Mazedonia: MASIT ICT Chamber tion Company, TVO Tinhvan Outsourcing,
shore Market leader of Commerce PROTOCOL Software, MINH PHUC
> Andreas Ganswindt, Ciklum
Speed Presentations of 8 Macedonian companies 14:30 NEXT STOP TURKEY
> AXELTRA, ARTHAUS, BRANSYS, EIN-SOF, INFI-
13:00 EGYPT Greeting by Deutsche Messe with
NITE SOLUTIONS, NEOCOM, PEXIM, SEAVUS
Egypt on its way to world markets: Panel and presentation of CeBIT Bilişim
Presentations by Egyptian and International 15:00 - 15:30 Presentation of Turkish companies
companies Ukraine: How to benefit from the hidden
Nearshore - Champion
> Andreas Ganswindt, Ciklum

INTERNATIONAL EVENTS
© CeBIT
BITS IN BRAZIL
› Deutsche Messe has announced the launch of “BITS: Business IT South America - a CeBIT Event”, a new trade fair
and conference developed specifically for the Brazilian and Latin American IT markets.
BITS will debut from 10 to 12 May 2011 to 4.3% by 2016. Even more impressive topic areas Business IT & ICT Infra- capitals of Argentina and Uruguay. Rio
at FIERGS Exhibition & Convention is that GDP is expected to grow 5% in structure; Communications B2B & Lo- Grande do Sul accounts for 20% of Bra-
Centre in Porto Alegre, Brazil. BITS will 2010. When considering these positive cal-Based Services; Banking & Finance; zil’s GDP (USD 100 billion in 2008) and
provide the region’s IT and communica- factors, it is clear that now is the time to Public Sector; and Future Lab. The exhi- provides the country’s highest quality of
tions industry with its first comprehen- bring a CeBIT event to this region.” bition floor will also host a forum, a New life. The region is also home to four tech-
sive B2B platform, one that combines The BITS audience profile includes ana- Business Generation Area, and a central nology clusters – three in Porto Alegre
exhibits with supporting events such as lysts, developers, entrepreneurs, project lounge. Located adjacent to the exhib- and one in nearby São Leopoldo – that
seminars, forums, and matchmaking to managers, system managers, IT security its, the BITS conference will feature five function as outposts for such companies
deliver more value to participants than a as Altus, Dell, HP, Microsoft, SAP, and
one-dimensional fair or congress.
„Brazil is Latin America’s largest econ-
The exhibition of BITS will consist Siemens, while also providing incubator
and R&D facilities.
omy and an industry leader in informa- of the main topic areas Business Deutsche Messe is organizing BITS
IT & ICT Infrastructure.

tion technology and business process with the cooperation and support of the
outsourcing,” said Dr. Andreas Gru- Center of Industries of the State of Rio
chow, Member of the Board of Deut- Grande do Sul (CIERGS) and the Fed-
sche Messe. “Brazil’s IT industry bene- managers, database specialists, system tracks: Finance, Government, Industry, eration of Industries of the State of Rio
fits from five decades of strong govern- analysts, telecom managers, wireless Retail, and Telecom. Grande do Sul (FIERGS), which collec-
ment and private investment and the re- mobile platform managers, network BITS host city Porto Alegre is the capital tively represent 41,000 factories with
gion’s largest technical-skills labor pool. professionals, data center managers, and of Rio Grande do Sul, which is located at 600,000 employees. Additional partners
Growth in the Latin American IT market C-level executives. The exhibition com- the center of Mercosur (Southern Com- include IT industry associations SOF-
is projected at 3.1% in 2010, increasing ponent of BITS will consist of the main mon Market) and equidistant from the TEX and SOFTSUL. ‹

23
PROFILES
© CeBIT
COMPANY PROFILES
› Don`t miss the presentations and panels in Hall 6, Stand C 08. The Participants, Sponsors and and ‚best practice‘ abilities allow
Partners of the Flat World Forum are available for your requests and offers also after CeBIT. companies to focus on delivering
their product to market without the
overhead of a heavy management
53757 Sankt Augustin, Germany Alibaba.com has offices in more than structure to oversee the software de-
Phone: +49-(0)2241-89 42 615 30 cities across mainland China as velopment, we provide peace of mind
Fax: +49-(0)2241-89 42 617 well as in Taiwan, Hong Kong, Europe to our clients“
ACELLERE info@acellere.de and the United States. Ciklum is a Danish innovative IT
Acellere is a new generation soft- > Contact: outsourcing company specializing in
ware services firm, which is helping Molly Taylor Morgan nearshore software development in
organizations across the globe re- Manager, International Ukraine. We do not follow the tradi-
duce their software development and ALIBABA.COM Corporate Affairs tional IT outsourcing model of proj-
maintenance costs, leveraging our Alibaba.com (HKSE:1688) is the Alibaba.com EMEA ect-based services, and instead we
innovative technology based services. world‘s leading B2B e-commerce Phone: +44 (0) 20 7258 5106 offer our clients to establish your own
We are a global organization having company. It connects millions of Mobile: +44 (0) 7976 367 740 dedicated IT department in Ukraine or
our registered office in Germany buyers and suppliers from around BB: +44 (0)7534 016 659 to outsource, completely or partially,
and operations across the globe in- the world every day through three mollymorgan@alibaba-inc.com your software development. This is
cluding India. Acellere’s vision is to marketplaces: an English-language equivalent to having your in-house
industrialize software development marketplace (alibaba.com) for global IT specialists but for a significantly
and maintenance services. We have importers and exporters, a Chinese- lower cost and less administrative
developed a software engineering language marketplace (alibaba.com. nuisances.
platform leveraging which we are cn) for domestic trade in China, and, CIKLUM Our unique business model merges
able to offer software services, with through a joint venture, a Japanese- „Ciklum has over 8 years experience the human element with IT to not only
quality, productivity and transpar- language marketplace (alibaba.co.jp) in helping startup companies through help companies to grow, but provide
ency in our deliverables, way above facilitating trade to and from Japan. the often unknown transition of near ongoing resources that sustain growth
industry average today. Together, its marketplaces form a shoring their software development, with the flexibility to scale up or down
> Contact: community of 40 million registered we have a team of experienced and as markets shift. Ciklum clients can
Dr. Andreas Kotulla users from over 240 countries and skilled people that have helped 100+ gain control over their IT processes
Bergstrasse 29 regions. Headquartered in Hangzhou, companies do this, our methods and systems and get more value from

PROFILES
the resources they already have. We marketing support, preparation of of indo-german business relations.
surround each client team, both cli- marketing material, participation in This includes consultancy in the area
ent and IT, with knowledge sharing international trade fairs, public rela- of product management and market
activities to foster a profitable and tion activities, company foundation analysis, identification of opportuni- THE INDO-GERMAN SOFTWARE
productive work environment during and joint-venture, fund-raising and ties and risks for the company in the COMPETENCE NETWORK
their entire outsourcing experience, vc acquisition. European market, programs to sup- The Indo-German Software Compe-
including social events, strong infra- We find your partners and clients in port sales activities as well as offer of tence Network, Indescon, is the larg-
structure, financial and administrative Europe, ME, and Brazil! rent-free office space. est network of German and Indian
support, Q & A and consulting ser- > Contact: > Contact: software SME‘s based in Germany.
vices. Ciklum also provides project- Claus Traeger Claudia Westphal Founded by Indian IT professionals liv-
based services and peak resources Eisenmarkt 4 Expo Plaza 3 ing and working in Germany, Indescon
on a short-term basis to accomplish 50667 Cologne, Germany 30539 Hannover, Germany offers a platform for information
very specific tasks efficiently and with Phone: +49 (0)221 257 0786 Phone: +49 (0)511 437 4796 exchange and networking, helping
superior quality. Fax: +49 (0)221 257 0782 Fax: +49 (0)511 761 5998 build rich and sustainable business
Established in 2002, Ciklum employs info@consim.biz claudia.westphal@GIBC- relationships between enterpreneurs
more than 850 specialists with more www.consim.biz Hannover.org in the IT-industry in the two countries,
than 100 global teams that enable cli- www.GIBC-Hannover.org as well as the Indian IT professionals
ents to work directly with developers working in Germany and the IT indus-
to reach a high level of productivity. CURITIBA OFFSHORE CENTER try here.
Ciklum has seven offices in the four Curitiba Offshore is the international Indescon is currently represented by
largest cities in Ukraine, as well as of- effort carried out by the best of breed chapters in Stuttgart and Frankfurt,
fices in Denmark, Finland, the Neth- companies belonging to Curitiba, with regional officers committed to
erlands, Norway, Sweden, the United Brazil. Our offers ranging from IT INDE® LAW FIRM developing the organization their re-
Kingdom and the United States. We services to GRC, BI, CRM, ERP & InDe® Law Firm is an Indo-German spective areas. Majority of Indescon‘s
are a member of the Ukrainian Hi- MERP and Help Desk world class so- Law Firm specialized in German, activities involve organizing network-
Tech Initiative. Ciklum is a winner of lutions, which are provided to several European and Indian Intellectual ing and information events around
the 2009 Red Herring 100 Europe, an industry segments, such as finance, Property Law. Due to our special- Germany, such as the German IT
award given to the Top 100 private automotive, manufacturing and agri- ized knowledge in Indian Trade Round-Table, held in 2008 and 2009
technology companies based in the business. We will show you why Curi- Marks and Copyright Law, we are in Stuttgart, the India IT Days, held
EMEA (Europe, Middle East and Af- tiba is technologically sophisticated, one of the few law firms in Germany in Stuttgart and Frankfurt in 2008,
rica) region each year. globally savvy and culturally aware. It who also provide legal service with 2009 and the regularly held Indescon
> Contact: will demonstrate why well-reasoned respect to Indian Law. Our lawyers X-Table, so far organized in Stuttgart,
Andreas Ganswindt roads point toward Curitiba Offshore of Indo-German origin are highly Karlsruhe, Heidelberg and Hannover.
Sales Manager Germany as an essential partner sourcing skilled, zealously dedicated and well Further information about Indescon
Weissenburger Platz 6 destination for global services and experienced in both legal systems, can be obtained from www.indescon.
81667 Munich, Germany solutions providers. which allows us not only to effec- org. A list of members can be viewed
Phone:+49-89-80912980 > Contact: tively tackle the legal and commer- at www.xing.com/net/indescon.
Mobile: +49-177-320 31 29 Kelly Zeni cial issues of any given IP-matter > Contact:
andreas@ciklum.net Executive Manager but also the socio-cultural element. Ashant Chalasani
www.ciklum.de Phone: +55 41 9186 0444 We also have close association with Stammheimer Strasse 10
info@curitibaoffshore.com highly qualified lawyers based in 70806 Kornwestheim, Germany
www.curitibaoffshore.com India, though our lawyers in Ger- Phone: +49 (0)7154-82-7130
CONSIM CONSULTING many remain the contact person for a.chalasani@indescon.org
CONSIM – Consulting for Internation- the client right from the outset - we www.indescon.org
al Channel Marketing – established in consider ourself as „Ihr Partner vor
2002 in Cologne, Germany, support Ort, for your business abroad“.
companies and group of companies GIBC - THE GERMAN-IN- > Contact:
to internationalize their activities, and DIAN BUSINESS CENTER Oliver Sascha Hartmann NIEDERSACHSEN GLOBAL
to identify partners and clients in the GIBC-Hannover supports all phases Innsbrucker Str. 45 GMBH
Europe, Middle-East and Brazil. of the business expansion of Indian 10825 Berlin, Germany NGlobal is the central organisation for
Support companies in the follow- companies into Europe. The GIBC Phone: +49 (0)30 78890894-0 the coordinated domestic and interna-
ing activities: market development offers networks in several technol- Fax: +49 (0)30 78890894-1 tional marketing of Niedersachsen as
strategy, trainings and workshops in ogy and industry sectors and the hartmann@inde.eu a business location, with the aim of
internationalization, market studies, experience of how to use synergies www.inde.eu promoting the internationalisation of

25
PROFILES
the state.Nglobal’s core functions are

the foreign trade and locating busi-
ness, location marketing as well as STEFANINI IT SOLUTIONS
domestic and international trade fair Stefanini IT Solutions is a global PORTO ALEGRE INFORMATION UNACORP
activities. As the direct contact in Nie- provider of onshore and nearshore IT AND COMMUNICATION TECH- UNACORP (www.unacorp.com.br) is
dersachsen, NGlobal is the interface consulting, systems integration and NOLOGY COMPANY - PROCEMPA a Brazilian provider (+300 employ-
to businesses and investors at home outsourcing services. The company Procempa is one of the biggest public ees) of IT application development,
and abroad. has more than 8,500 employees with information and communication tech- with proper methodology to develop
At CeBIT: Hall 7, Stand A28 34 offices in 16 countries, and more nology companies in Brazil for over 32 projects for global corporations (off-
> Contact: than 350 active customers across a years. In the Porto Alegre’s adminis- shore outsourcing).
Osterstraße 60 broad spectrum of markets, including tration is responsible for the techno- DEVELOPMENT TECHNOLOGIES:
30159 Hannover, Germany energy and utilities, insurance, manu- logical development, being a pioneer Java, JSP, OpenSource Frameworks,
Phone: +49 (0)511.89 70 39 - 0 facturing and distribution, oil and gas, among Latin America’s digital cities. Design Patterns, Visual Basic, ASP,
Fax: +49 (0)511.89 70 39 - 69 financial services, and telecom. One of Its mission is to make ITC technolo- .NET: C#, VB.Net, ASP.Net, XML,
info@nglobal.de Brazil‘s leading IT companies, Stefa- gies available to City Hall, clients and Delphi, PHP, C/C++, Oracle Tools:
www.nglobal.de nini IT Solutions is CMMI Level 5 and the citizen, maintaining the continuous Portal, OLAP, Workflow, BI, Reports,
ISO 9001:2000 certified. development. The company operates PL/SQL, TEST Tools
> Contact Europa: in the e-Government, focusing on the SUPPORTED TECHNOLOGIES:
Leonardo Bruno Melo citizen, qualifying public management Windows, UNIX, Linux, Oracle, MS
Portland House Bres- and the corporate market. SQLServer, DB2, Sybase, Open-
SIPPO SWISS IMPORT senden Place 19th floor > Contact: Source, Oracle iAS, Microsoft COM+,
PROMOTION PROGRAMME SW1E5RS London, UK Av. Ipiranga, 1200 IBM Websphere, BEA/Tuxedo, BEA/
SIPPO Swiss Import Promotion Pro- Tel: +44 (0) 20 8433 6935 90160091 Porto Alegre, Brazil Jolt, Weblogic
gramme is a mandate of SECO, the lbruno@stefanini.com Phone: +55 51 3289 6123 > Contact:
State Secretariat for Economy of the Fax: +55 51 3289 6198 Eduardo Radziuk
Swiss government. The programme procempa@procempa.com.br Executive Director
supports private businesses in mar- www.procempa.com.br Phone: +55 51 3346 4422
kets in transition to get an access to Mobile: +55 51 9966 4493
the Swiss and EU markets. eduardo.radziuk@unacorp.com.br
The services include trade informa- SUYATI
tion, technical assistance and trade Raise your ROI with Suyati’s extended
promotion. At the same time, Swiss dedicated global teams (www.suyati.
and EU companies are given free and
competent support in their search
com) and invigorate your market-
ing through Suyati’s active online
Next Stop: CeBIT FLAT WORLD FORUM 2011!
for new sourcing markets, products content (www.contentcrossroads.
and cooperation partners. com) solutions. We provide unique Call for Papers - Call for Speakers
At SIPPO collective stand at Cebit value added solutions to small and Wanted:
2010 – Hall 2 stand D 28 18 selected medium technology companies to Your analysis on global trends for the ICT service industry
Software companies from Macedo- improve the revenue and reduce Your approach to BPO, Offshoring, Localisation, Education
nia, Kosovo, Ukraine and Vietnam the cost side of business without Your contribution to a successful internationalisation of SME
are offering excellent solutions and sacrificing on innovative product or

services with an outstanding price/ service delivery. Suyati is led by a Your partner:
performance ratio as well as attrac- seasoned team of professionals and local global GmbH
tive opportunities for long term co- has offices, partners and clients in Know-how for your International Business
operations on a Win–Win basis. India, United States and Europe. local global is an innovative partner for trade and investment promotion agencies:
We develop publications, seminars and conferences with a strong focus
> Contact: > Contact: on internationalisation.
Boyko Doytchinov Mukund Krishna
Osec, SIPPO Swiss Import 2nd Floor, B-Wing, Tapasya Contact us:
Stampfenbachstrasse 85 Infopark, Kakkanad local global GmbH
P.O.Box 2407 Kochi- 682030, India Marienstraße 5
D-70178 Stuttgart
8021 Zürich, Switzerland Phone: +91 484 406 0800 Phone + 49 711 / 22 55 88-20
Fax + 49 711 / 22 55 88-11
sippo@osec.ch mkrishna@suyati.com schulze@localglobal.de
www.sippo.ch Germany: whoeltgen@suyati.com www.localglobal.de
Join the Cebit Flat World discussions - 2011

26 and on twitter/flatworldforum CEBIT 2010 GLOBAL BUSINESS MAGAZINE
 ��
��
��
��
 ��
��
��
 ��
��
��
 ��
��
��
 ��
��
��
 ��
��
��
 ��
��
��
 ��
��
��
Order Now
��
��
��
��
� ��
��
��
��
��
��
��
Nied
��
��
��
��
��
Globa ersachse
��
��
�
��
��
��
��
n
��
��
��
��
l
��
ISSUE ��
#2 I 20 ��
��
Magazin 09
and Tec e for Busines ��
s
��
hnology ��
��
�
��
��
��
��
��
��
��
��
��
��
��
��
��
local global GmbH
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
�
��
��
��
��
��
��
��
�
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
��
� ��
��
��
��
��
��
��
��
��
��
��
��
��
� ��
International
Management
Success in International Projects

with Steinbeis Young Professionals
Qualified
You choose future members for your international
project teams from a large pool of preselected high
potentials.
Motivated
You benefit from highly motivated young
professionals: Management Assistants who know
your company and your products from scratch.
Hands-on
Management Assistants who are familiar with
company- and product-specific situations adapt current
knowledge to the specific needs of your enterprise.
Support for your global business:

www.steinbeis-msc.de
��
��
��
��

Global Business Magazine CeBIT 2010

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Global Business Magazine CeBIT 2010

Uploaded by

Copyright:

Available Formats

GLOBAL

CeBIT has always held the clearest mir-

For many countries, CeBIT is the plat-

Published by In Cooperation with Advertisements

GLOBAL BUSINESS MAGAZINE CEBIT 2010

Keine Tiger in Indien Of Tigers and India

become one, have

and all the smal

Offshoring in turbulent times E-commerce on the rise

the reorganization of the production of many services. Alibaba’s new services

MAGAZINE 6 Offshoring in turbulent times

IT & ICT offshoring

Alibaba CEO David Wei on the 22 FLAT WORLD FORUM - Programme

EDITORIAL 20 German IT INNOVATION 24 Company profiles

GLOBAL BUSINESS MAGAZINE CEBIT 2010

OFFSHORING IN TURBULENT TIMES

6 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

services and ICT-enabled services (table

GLOBAL BUSINESS MAGAZINE CEBIT 2010

8 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

Global exports resulting from the

GLOBAL BUSINESS MAGAZINE CEBIT 2010

10 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

GLOBAL BUSINESS MAGAZINE CEBIT 2010

12 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

Level of attraction of country by cost

GLOBAL BUSINESS MAGAZINE CEBIT 2010

Level of attraction of country by cost

Market potential comparison

Egypt but lower than in CEE and about

14 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

EGYPT – A NEW GROWTH

GLOBAL BUSINESS MAGAZINE CEBIT 2010

› Why should purchasers consider

› How do you see the European

GLOBAL FUTURE OF TRADE lowers in Europe, but we want to fur-

16 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

› Will Alibaba offer any new serv-

GLOBAL BUSINESS MAGAZINE CEBIT 2010

CBI brings prequalified, competing, offshore software development companies to Europe.

18 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

In hall 6 stand D02, CBI presents ›

sized IT companies in a number of

GLOBAL BUSINESS MAGAZINE CEBIT 2010

20 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

With a 9 percent annual growth

years to become one of Germany’s

GLOBAL BUSINESS MAGAZINE CEBIT 2010

CeBIT | 2.3. – 5.3. 2010 | Hall 6 | Stand C08

22 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

IT & ICT Infrastructure.

GLOBAL BUSINESS MAGAZINE CEBIT 2010

24 CEBIT 2010 GLOBAL BUSINESS MAGAZINE

GLOBAL BUSINESS MAGAZINE CEBIT 2010

the state.Nglobal’s core functions are

are offering excellent solutions and sacrificing on innovative product or

Join the Cebit Flat World discussions - 2011

Success in International Projects

Support for your global business:

You might also like