Surprisingly little to customer companies looking to seek services from around the world. The decision on the choice of delivery location invariably gets pushed on the provider’s to-do list. The provider has to deliver, customers reason, and it is not their concern where the he delivers from. Customer companies are only interested in the SLAs being met — for which they do extensive due diligence on the provider’s track record, domain expertise, financial health, expertise of key managers ….

The provider, too, is happy — for him it’s a vindication of his “best-shore” rhetoric.

Sounds fair. So do the following reasons on why customer companies should care about where their processes are being delivered out of:

• Companies would like to align the location of their offshore units with their market-entry strategies for that region. Agreeing to the provider’s location suggestions without giving it much thought may mean lost opportunity for working on a broader company strategy for growth. In the case of captives, joint ventures or build operate transfer models, this becomes even more critical
• On the cost front, the reason for customer companies to seriously analyze location options is obvious. After all, if they are being serviced out of Moscow versus Kiev would mean that they have to foot the extra bill in terms of wages, real-estate costs, telecommunications, power, management cost …. Of course, they will have to work out a balance between the cost savings that they will get at a particular location versus the maturity of that location for delivering their particular services
• Though thought about living conditions generally pales in comparison to business objectives, it can significantly impact the morale of the operations team that has to deal with the offshore third party on a day-to-day basis
• Often providers push a particular location simply because that’s where they are headquartered — this is good strategy from the providers’ perspective, but is it for the customer?

Such that customer companies are armed with location-specific information that they can use to negotiate with providers, Global Services teamed with advisory firm Tholons to rank the top 50 emerging global cities for sourcing IT and BPO services. We also identify the best ones for outsourcing specific functions. Read the story on page 16.