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Offshoring Becoming Truly Global: AT Kearney Study
This year's study included developed nations as well
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While there’s stability at the top with India, China and Malaysia retaining the top slots as the most attractive “offshoring” destinations, offshoring is increasingly becoming a global game, with even African nations making their appearance in the global-outsourcing radar screen, finds an AT Kearney study. The Global Services Location Index for 2005, released by the strategy consulting firm, ranks geographies based on their overall attractiveness as service-delivery locations, and also within three broader areas — financial structure, people and skills availability and business environment.

While Asian locations such as the Philippines and Singapore follow the leaders, thus making Asia the undisputed leader in global offshoring, Czech Republic and Brazil have shown a slide. The United States, included for the first time, has fared quite well, despite low scores in financial structure (higher costs). The study this time also included other developed economies such as U.K., Germany, France, Spain but none have performed as well as the U.S.A.

African nations such as Egypt, Ghana and Tunisia have also fared well, with Egypt occupying a respectable position of 12th, ahead of locations perceived to be hot such as, Mexico and Ireland. In fact, Ireland shows up barely at the bottom of the table, at 39th position among 40 countries.

Some trends as observed by the study include

    India remains the best offshore location by a wide margin, although wage inflation and the emergence of low-cost countries decreased its overall lead

    Improved infrastructure and relevant people skills have increased the attractiveness of China as a low-cost option for servicing Asian markets

    Thailand jumped from 13th to 6th in this year's Index and South-east Asian countries now make up four of the top six locations on the Index

    Offshore attractiveness in Europe continues to migrate eastward as Bulgaria, Slovakia and Romania all enter the Index for the first time

    The Middle East and Africa appear to be the next frontier in offshoring as countries such as Egypt, Jordan, United Arab Emirates and Ghana perform well.

The top ten locations are India, China, Malaysia, Philippines, Singapore, Thailand, Czech Republic, Chile, Canada and Brazil

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