If it’s a simple
project and you
don’t need the
people, then it
may be worth
trying a new
“Africa is an extremely large
untapped resource,” Mr. Ward notes.
“Unfortunately, due to civil unrest and
outright war in certain areas, low levels
of education and pervasive corruption
in many countries, it can be quite chal-
lenging to do business there.”
currently have captive outsourcing
arrangements in Romania in which
they use remote resources for the deliv-
ery of functions close to their core
business while retaining operational
control. The country offers a large
number of professionals who speak
German, Italian and French as well,
Mr. Trakhtenberg says. “It’s harder to
find that level of diversity in Russia or
Ukraine,” he says.
But if you are
you need people
—Pedro Serrador, PMP, Serrador Project
Management, Toronto, Ontario, Canada
Although costs aren’t as low as other
emerging outsourcing hotspots, Eastern Europe offers competitive pricing,
along with some of the most highly
skilled project talent in the world.
Russia, for example, has a long history of investing in science and math
education, and its universities produce
more than 1 million programmers a
year, notes Mr. Trakhtenberg. “Luxoft
views Russia as a top destination for
high-end complex outsourcing initiatives,” he says.
Ukraine offers similar benefits, with
a strong educational system focused on
IT, as well as tax incentives and visa-free travel for E.U. companies.
“The Ukrainian government is taking this industry very seriously,” says
Mr. Trakhtenberg, who estimates the
country’s labor costs are 15 to 25 percent lower than Russia’s.
Romania is another rising leader,
particularly in telecom projects. Siemens, Alcatel, Microsoft and Oracle
Wherever the destination, project executives need to invest the same time and
energy in choosing an outsourcing vendor as they would in putting together
an in-house team, says Balazs Fejes,
the Budapest, Hungary-based CTO of
EPAM Systems, a software engineering
“Just looking at the bottom line is
not the most productive way to make
a decision,” he says. “You’ve got to
look at outsourcing as a partnership
and be open about what you hope to
Too often, companies enter out-
sourcing agreements with unrealistic
expectations, such as assuming they’ll
find specific business domain expertise
in a still-emerging market.
“In the beginning, both parties must
discuss their goals, issues and concerns,
and everyone has to be honest,” Mr.
Otherwise, delivery goals will never