market IT Sourcing Europe 2012

What keeps companies away from outsourcing?

The 3d Annual European IT Outsourcing research 2012 has found that one of the key factors keeping Western European companies away from considering outsourcing their high-tech solutions is that they want to have maximum managerial control of their project (cumulative 60% across all countries polled).

Nearshore vs onshore?

The research concludes that nearshore (in a nearby country) is the most preferred outsourcing destination of the future in the United Kingdom, Denmark and Norway, while onshore (within a home country) is the most preferred destination in Germany and Sweden. Offshore destinations (more than 2 time zones away) are still quite popular in Scandinavia, but are rather unpopular in the United Kingdom and Germany.

When survey participants were asked to evaluate factors that would influence their choice of future outsourcing destination, cumulative 74% of German companies pointed to availability of strong foreign language skills (English or German), legal system and intellectual property (IP) maturity and economic stability as their top 3 criteria. In Sweden, the top 3 criteria in the future choice of an IT outsourcing locale were: language skills availability (100%), vast IT talent pool (68%) and economic stability (67%). Norwegian companies seem to be more concerned with cost saving than their peers in other EU countries surveyed: for 100% of companies low costs are the Number One factor that will influence their choice of outsourcing location in the future.

A decent ITO partner – How to find one?

When asked to evaluate factors that will be driving their choice of a future IT outsourcing partner, almost 60% of German companies said they would consider a vendor with a certain level of quality certification, cumulative 70% of Swedish companies would consider positive references from peers and vendor’s sound experience in similar projects and almost 70% of Norwegians pointed to vendor’s expertise with similar projects.

To find an outsourcing partner in the future, more than 80% of the UK, 55% of German, almost 70% of Danish and almost 85% of Norwegian companies will do their own online research, while almost 80% of Swedish companies will ask their peers for vendor references. Only slightly more than 20% of Swedish, 25% of Danish and less than 20% of German companies would hire a consultancy to help them determine the partner.

More outsourcing journeys in 2013?

Asked directly whether they plan to outsource at least any element of their IT / software development function in 2013 and / or years to come, cumulative 39% of companies answered with “yes”. This suggests that outsourcing is here to stay for a while no matter how much it will change and what it will be called in the future.


Author: Evgenia Kutsa, Marketing Associate at Ciklum, Source: Ciklum Blog, Ciklum is Knowledge Partner and Member of the German Outsourcing Association (Deutscher Outsourcing Verband e.V.). , Picture: IT Sourcing Europe – IT Outsourcing Intelligence Reports 2012