Time for a quick geography quiz. Which is closer to Miami: New York or Cartagena, Colombia?
The answer is the latter, as I found out flying down here yesterday. I am attending the Latin American Outsourcing Summit, where leading outsourcing firms in the world pick up new trends and meet with each other along with their major customers, such as Johnson & Johnson, Proctor and Gamble, Microsoft and Miller Beer.
Colombia has a “very positive business climate, one of the best in the Americas, and very unique in the region,” says Lalo Steinmann, a Microsoft Enterprise Technology Strategist and an Argentine working in their south Florida office for the past six years. The perception of Colombia as a drug-sodden collection of warring cartel gangs doesn’t match with Steinmann’s own reality, having traveled frequently to the area over the past several years. “Colombia does have to deal with fighting these security perceptions, but the government here is doing a great job.”
Another asset for Colombia, as I learned: it has a similar working day to the US, on Central Time during the winter for example. This has a lot of appeal for American corporations that are pursuing agile projects and want more interaction with their outsourcing partners. Google, for example, picked an Argentine partner for one of their projects for precisely this reason. “Colombia also has the Internet bandwidth and legal infrastructure here and a very mature management too,” said Steinmann. According to statistics cited by President Santos of Colombia, it also has a very vibrant entrepreneurial climate too, with 100,000 new jobs being created in the past few years by new businesses. Indeed, my escort who picked me up at the airport told me that he had started his own Web site and iPhone app development firm and now employs half a dozen programmers and engineers.
At the conference, I heard from Michael Corbett, president of International Association of Outsourcing Professionals. He spoke about how his industry stands at “a threshold moment,” thanks to cloud computing. “The new outsourcing industry in Latin America will be much more sophisticated. It isn’t just good business policy but good social policy. Cloud computing is the first truly disruptive technology to hit our industry.”
Corbett spoke about how outsourcing has evolved from merely providing cheap labor to becoming more of a business partner and the cloud will better cement this relationship going forward. However, cloud adoption in the outsourcing market is currently low: About half the audience was familiar with the term and in a poll that Corbett’s association conducted earlier this year, 40% of the respondents have no plans to implement cloud computing anytime soon.
Nevertheless, outsourcing providers have become more global in their own right: “The average service provider now has operations in 11 different countries,” said Corbett. .