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Outsourcing to Latin America

October 2 2010 - A survey by Harris Interactive on behalf of Capgemini, a leading provider of consulting, technology and outsourcing services, found that Latin America is a significant emerging outsourcing destination for U.S. companies. India remains the most popular, chosen by 60 per cent of respondents, followed by China (27 per cent) with Latin America selected by 25 per cent.

The survey was conducted online among 300 senior executives at Fortune 1000 companies. The top reasons for selecting Latin America as part of outsourcing strategies are:

  • labour costs (69 per cent)
  • technology and infrastructure capabilities (49 per cent)
  • availability of skilled labour (48 per cent)
  • economic stability (44 per cent) and
  • language proficiency (41 per cent)

This reflects a general pattern in outsourcing decision-making, suggesting that the role of Latin America will continue to expand. Other reasons cited are unique to the region, such as proximity to the U.S., time zone alignment and accent neutrality.

The survey also found that 45 per cent of respondents who currently do not outsource to Latin America expressed interest in considering the region for future development. The great majority (89 per cent) believe that Latin America is an emerging market that will become increasingly important to U.S. businesses; 83 per cent agree that there are advantages to doing business in this region and 56 per cent that it is becoming easier to operate in Latin America compared to other locations.

David Poole, vice president and head of Americas business process outsourcing, commented:

"As the economy rebounds, companies are looking to use outsourcing more strategically as a tool to increase efficiency, yield significant cost savings and drive growth; this includes considering locations beyond India. The expansion of Capgemini’s outsourcing services in Latin America, and our work with Unilever, Coca-Cola Enterprises and other clients in the region underscores our understanding of our clients’ needs and ability to provide the right global delivery model for multinational businesses."

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