openPR Logo
Press release

Smartsourcing in Eastern Europe

10-01-2008 01:18 PM CET | IT, New Media & Software

Press release from: TEAM International

/ PR Agency: TEAM International
TEAM International

TEAM International

In 2008 the outsourcing business of Eastern Europe was estimated at nearly $2 billion, representing just a tiny fraction of the global IT outsourcing market, estimated at about $386 billion. According to the Gartner Dataquest predictions, in the next four years Eastern Europe is expected to outstrip the rest of the offshore market concentrated mainly in the “classical” locations like India. By 2010 Eastern Europe’s IT outsourcing market share is predicted to expand up to 30%, while the global market share is anticipated to grow by 25% only.
The secret of Eastern Europe’s success may in part be due to a potent mix of attributes that no other rival region can offer: a multilingual and highly educated talent pool and an abundant, yet undiscovered consumer market.

Outsourcing is booming as Eastern Europe moves more rapidly to integrate economically in its more successful western neighbors. This process reflects the progress consisting in reduced unemployment rates and increasing development of a real estate business offering high-rise office space. The outsourcing boom is also fueled by the fact that Western Europe currently experiences significant labor shortages in some of the extremely important occupations. To ease the strain, Western Europe has no other choice than to turn to its eastern neighbor. So, the chain of interdependencies between two Europes is self-evident.

And how is it going with outsourcing in the traditional destinations? A recent Forbes publication sheds some light on the actual state of affairs in India, once the hottest offshore outsourcing spot. Although India is commonly believed to be riding high on outsourcing with 4 million people involved in IT-enabled services in 2008 that account for 7% of GDP, Forbes points out that the reality is far from a perfect picture. The wages are rising in India. In 2007 the Indian salaries rose 15.1% from 14.4% in 2006. This year the analysts expect them to rise 15.2%. Today’s cost advantage for IT outsourcing to India is assessed to be 1:3 at its best. Attrition rates are scary, too.

According to Forbes, India is still the world’s back office whose tech industry is, in fact, a services industry. India’s greatest oversight is that it never did the thinking, it only executed. As a result of this, India did not learn how to invent technology products of its own. Tech-sector venture capitalists that once chased India are now unable to deploy their capital and have to divert it to other industries such as real estate and hotel, retail and non-tech sectors.
Another huge difference between India and Eastern Europe is attitude towards customers. Forbes says that the “Indians are complacent and will not take risks”, they simply outsourced the thinking to their clients. Eastern Europe is hungry for more business contacts with the rest of the world, integration in the global IT market, improving their living conditions etc. The Eastern European companies, using their local resources and talents, strive to supply their customers with innovative, sophisticated and smart solutions; they are ready to take the whole burden of the client’s problems on their own shoulders. They are creators rather than executors.

According to the Gartner’s Hype Cycle for Emerging Technologies, in the next ten years only companies that dedicate all their resources to learning and mastering new trends and technologies will be able to “keep the head above the water”. With today’s cost structure 1:3 India still attracts US companies. But what will happen when this structure becomes 1:1.5? There will be no reason for the US companies to use India as their back office that does not generate any bright ideas. Enough executors can be found in Georgia, Oklahoma or British Columbia. Today Eastern Europe with its great technology potential has all the chances to become more compelling than India or any other classical outsourcing destination.

They say that the next stage of IT outsourcing will be smartsourcing. Smartsourcing suggests that the processes be executed and the ideas be generated jointly by all the parties involved. Today Eastern Europe seems to be ready to follow this new model of outsourcing. Locations like Ukraine have a great potential to open a new page in the history of the outsourced business development.
Sources: Forbes (, The New York Times (, Gartner (

TEAM International is a U.S.-owned and managed IT outsourcing firm that provides offshore software development and configuration, as well as IT staffing and Recruitment Process Outsourcing (RPO) solutions.

TEAM International
11-a Novgorodskaya Str.,
Kharkov, 61166, Ukraine
ext. 6355

This release was published on openPR.

Permanent link to this press release:

Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release Smartsourcing in Eastern Europe here

News-ID: 55429 • Views: 2559

More Releases from TEAM International

TEAM International Attends at the 2009 IAOP Summit
Joe Chiovarou, Vice President of Business Development, will be attending the IAOP Conference in Carlsbad, CA February 15 – 18, 2009. This year TEAM International will be represented at the 2009 World Outsourcing Summit by Joe Chiovarou, VP of Business Development. The Summit will be held by the International Association of Outsourcing Professionals (IAOP) on February 16-18 in Carlsbad, California. TEAM considers this well-known outsourcing event as a great
TEAM International attends an international HR Conference to improve its staffin …
In today’s highly competitive IT world Human Resource Management is one of the most critical tasks. For organizations to establish positive customer relationships, to improve customer satisfaction and the quality of project deliverables, smart HR management and monitoring techniques should be developed in order to find, hire and attract IT talent. Permanent struggle over a scarce Human Resource pool makes IT outsourcing companies become more inventive and draw new information

More Releases for India

Medical Tour India | Affordable Treatment In India
We at MedCredible look after the well being of the patients seeking treatment in India. Our support staff support is well trained in handling various situations arising due to cross border differences. All the patients can avail of high-quality treatment at an extremely affordable cost in a compassionate environment combined with ethical practices. With options of over 100 + Hospitals and Institutions, we at Medcredible ensure that we connect the
01-17-2011 | Health & Medicine
IVF India, Test Tube baby India
The aim of setting up KJIVF is to help infertile couples in achieving conception through modern diagnostic and treatment methods. KJIVF Centre has given the best results by blessing infertile couples of advanced age with children, these couples could never dream of becoming parents. Thousands of babies are conceived through in-vitro fertilization (IVF) each year; In-Vitro Fertilization (IVF) means fertilization outside the body. A baby developed from an egg that
Beach Holiday India- Best Beaches in India
The natural beauty, exotic locations and rich heritage has helped India to stand as the most visited and most popular tourist spot in the world. The status of “Incredible India”, is defined by an incredible range of nature’s blessings on the Indian subcontinent and this incredibility is doubled by one of the most fabulous tourism option available in the country that are the brilliant and majestic beaches in India.
ISO 27001 India, 27001 training India ISO
Coral eSecure is information Risk Management advisory with specific focus on Information Security (ISO 27001, ISO 17799, PCI, COBIT, HIPAA, GLBA, and DPA), Business Continuity (BS25999) and ITIL/ IT Service Management (ISO 20000). Coral is the FIRST Indian consulting organization which provides an Integrated Management System Consulting, Consisting of ISO 27001, ISO 20000 and BS25999 – ALL THREE IN ONE! Coral provides Consulting, Assurance audit and Training to address these
Interior Designers India, Designers and Architects India
Today, we have recognized ourselves as a booming beauty interior designing firm, offering services that include interior designing. We are a winning firm, which is based on the strong foundation of innovative and original ideas for interior, architectural and landscaping designing services. Synergy Corporate Interior Design Association has more corporate members. Who provide Products and services. We support Interior Designers India, Designers and Architects India. We are committed to the
Domain Registration India, Web Hosting India, Payment Gateway India is a Quality Web Hosting Company India, provide all web related support and Web hosting services like linux web hosting, windows web hosting, web hosting packages, domain registration in india, Corporate email solution, business email hosting, payment gateway integration, SSL with supports like free php, cgi, asp, free msaccess, free cdonts, free webmail, web based control panel, unlimited ftp access, unlimited data transfer. During the domain registration process, you will