By PSL Corp on Tuesday, 29 September 2015
Category: Outsourcing

Top 10 advantages of IT outsourcing to Latin America (Part 2)

This is the second part of the Top 10 advantages of IT Outsourcing to Latin America. If you havent read the first part, you can do it here.

6. IT Outsourcing to Latin America, Tip # 6: Superior strength in the Agile world. More than any other region outside of the United States, Latin American IT outsourcing has adopted the agile standard in Software Development. We have spoken extensively about the advantages of agile in other blog posts (please see here) –but in a nutshell, when it comes the time to deliver software faster, cheaper and with a lower risk of project failure, agile is hard to beat. In our experience, Indian IT outsourcing tends to deliver under traditional methodologies, especially because agile does not work well with large time-zone differences. Furthermore, because of the US's academic influence on Latin American universities, most have begun to push agile as the preferred way to develop software. Concomitantly, Latin America IT outsourcing firms have adopted, and currently deploy, world-class agile IT outsourcing services (do a quick search for "agile development Latin America" in google and find out for yourself!)

7. IT Outsourcing to Latin America, Tip # 7: The larger Latin American companies have learned to make good software the hard way. For many years, Latin America was a closed economy to software imports. This meant that large local players had to develop their own banking cores, their own ERPs, their own CRMs and—in general—their own robust products with which to run their businesses. This experience profoundly marked Latin American players, making them highly savvy with the end-customer. In Asia, one finds many IT outsourcing firms that are technically strong (as one does in LATAM) but it is rare to find Asian companies that could be considered "product oriented" or "end customer oriented". Solving a technical problem is not the purpose of software. The purpose of software is to understand the context within which a technology solution can create a paradigm shift for the user, and this necessitates having an eye for understanding client needs. It is hard to beat Latin American IT when it comes the time to outsource software-based product development.

8. IT Outsourcing to Latin America, Tip # 8: Latin America exhibits significantly less employee churn rates than Asia. Today, it is not uncommon for employee churn in India to hit 25 to 30% per annum. In Latin America, churn is, on average, 5 to 9% per annum. Think about it: you have a team of 6 people working from Asia and you invest in their learning curve. By the end of the year, you have a statistically very high probability that only 4 will remain with your team. What is the hidden cost of this? Much more than the couple of bucks you save with Asian rates. Because it is a relatively nascent location for bilingual IT outsourcing, Latin America offers significantly more stability (3 to 4 orders of magnitude more), which translates into better leverage of the nearshore team, greater productivity and significant savings. This might not be a permanent advantage, but we believe it will still last several years (much longer if the Asian labor markets remain burning hot…)

9. IT Outsourcing to Latin America, Tip # 9: A note on safety. It used to be the case that Latin America was considered unsafe. Not any more. Take the case of Colombia. A nation that epitomized drug violence in the 80's and 90's, is now considered Latin America's rising star, receiving the second largest foreign investment in 2011 after much larger Brazil, with inbound tourism growing in leaps and bouds. With Colombia reaching safety levels that compare with Buenos Aires and Sao Paolo, all nations with 40+ million inhabitants in Latin America are now worth a visit. Sure, when visiting any developing nation you have to be careful of petty theft, but you need not fear for your life. Like Colombia's tourism office says, when outsourcing IT to Latin America "the only risk is wanting to stay".

10. IT Outsourcing to Latin America, Tip # 10: Latin America exhibits a strong work ethic. Yes, Latin Americans like to party hard. But they also like to work hard. When dealing with Latin America for an IT outsourcing project, you will notice the deployed team will have no problem burning the midnight oil to meet a deadline. It is part of our culture to create a strong sense of loyalty, purpose and pride to our work and our clients. This can often prove invaluable when the going gets rough in a demanding project.

Regarding PSL: With more than 30 years of experience, PSL specializes on outsourcing and nearshoring software development projects as well as Team Augmentation. Based in Colombia, Mexico and the US, PSL is an agile SCRUM development shop focused on high quality services. 

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