Reasons for Outsourcing your Software Project to Colombia
In 2014 TECNA (Technology Councils of North America), together with the University of Phoenix and Apollo Education Group, pursued a research of technology industry in more than 29 US states and 3 Canadian provinces to gain broad insight into software development talent acquisition. 83% respondents admitted that there is a shortage of software development professionals and according to U.S. Bureau of Labor Statistics (BLS) by 2020 employment in all computer-related works will increase by 22%, while Information Communications Technology Council (ICTC) in Canada states that the country will have to fill 182,000 IT-related positions by 2019. Such shortage of in-house IT professionals enlarges the number of companies that decide to outsource their IT projects and often turning to nearshore vendors is likely to become the best option.
Outsourcing, both nearshore and offshore, can ensure significant savings and help to fill the gaps in IT professionals pool. However, there are numerous advantages that can be provided by nearshore outsourcing model and they are:
- No time difference, same time zone
- Cultural affinity
- Low turnover
- Ease of management
- Better collaboration
- Keeping to advanced practices
In the last five years, Colombia has moved to the top lists of IT outsourcing providers thanks to such factors as enhanced security, attractive business environment, highly-skilled labor force, controlled inflation and good international flight connectivity. Such economic stability and loyal government policy are already turning Colombia into regional tech and business hub, attracting more and more multinationals to the market. The capital city, Bogota, holds the position of the largest outsourcing destination, but Medellin, 2nd largest city, follows hard on heels.
Top Reasons to Outsource to Colombia
· Colombia is located in the middle of five time zones and it shares a time zone with such important business centers as Toronto, New York, Miami, LAX, Buenos Aires, Mexico City and others.
· Colombian talent pool numbers more than 340,000 IT professionals (Systems Engineering and other IT-related careers), graduated over the 2001 to 2013 period.
· Colombia is named the 3rd country with most IT services sales in Latin America, after Brazil and Mexico, and according to Gartner, compound ratio of industry growth will reach 13%.
· With 48.4 million inhabitants Colombia is the 2nd largest Spanish-speaking country in the world and there are around 70 languages that are spoken in the country these days.
· The list of universities in Colombia numbers more than 50 universities with public and private ones among them. 7 Colombian universities are amongst the best in the world.
· In 2015 Index of Economic Freedom ranking Colombia was named 28th globally and it is the highest score ever. The country improved 6 of the 10 economic freedoms, namely: investment freedom, freedom from corruption, trade freedom, etc.
· World Bank ranked Colombian economy 32nd globally (out of 214 economies) in the List of Countries by GDP (nominal) 2015.
· In “Doing Business 2015: Economy Ranking” Colombia is 54th globally and #3 in Latin America & Caribbean region.
· In Global Competitiveness Index 2015–2016 by World Economic Forum Colombia has gone up 5 positions and now it is ranked #61 out of 140 economies in the annual ranking of countries’ productivity levels. Moreover, Colombia is included in the Top 5 countries in Latin America and Caribbean region. The country improved its ranking thanks to the enhancements in financial market development, business sophistication, and good macroeconomic environment results.
· Colombia is named one of the six countries with the largest share in global economic growth by Economist magazine. Among the leaders, there are such globalized giants as United States, Japan, Mexico, Brazil, etc.
· Colombian economy was ranked as the 27th largest economy worldwide in 2014 and it is one of the largest economies within the non-OECD (Organisation for Economic Co-operation and Development) economies.
· In “Doing Business 2015: Going Beyond Efficiency” report the World Bank Group ranked Colombia as the #1 country in the Latin American and Caribbean region in the “ease of doing business” ranking and #34 globally (out of 189 economies).
· Colombia is listed in Gartner “Top 30 Destination Countries for Offshore Services” for three years in a row. The countries are ranked according to such criteria as language, labor pool, infrastructure, government support, educational system, cultural compatibility, cost, political & economic environment, global & legal maturity, and data & intellectual property privacy and security.
· Launch of “Colombia Bring IT On” campaign in 2014 boosted Colombian IT sector and in 2014 it was ranked the 3rd largest in Latin America. In a nutshell, the campaign was aimed at growth promotion of the country’s technology sector in the global market and increase of awareness around Colombia’s competitive strengths in the IT industry.
· The National Service of Learning (SENA) is a Colombian public institution that offers free education and technical trainings to every citizen. This governmental initiative is oriented to develop education and invoke further employment. This program is also known as “university for all” and it offers around 250 programs for all Colombians. Offering professional training courses, SENA invests in technical and social development and ensures Colombians’ contribution to the country’s economic, social and technological growth.
· Over 200,000 Colombians graduate every year from higher education institutions. The number of graduates in engineering and business administration in 2012 comes to over 130,000, according to Employment Observatory, Ministry of Education.
· According to IMD 2014, Colombia has the 2nd largest growing labor force in the region.
· The Productive Transformation Program (PTP) is a governmental initiative aimed to facilitate and support Colombian services sector, and to promote the strategy of development and growth. PTP is recognized as an efficient tool for industry transformation, promotion and increase of productivity, growth, and competitiveness of Colombian companies in such strategic sectors, as Manufacturing (Editorial and Graphic Communication Industry, Auto Parts and Vehicles, Fashion industry, etc.), Services (BPO&O, Software & IT, Electric Energy and Services, etc.), and Agribusiness (Aquaculture, Dairy, Beef and Cattle, etc.)
· Created back in 2010 by The Ministry of ICT (Information and Communication Technologies), Vive Digital Plan is aimed at supporting IT and technological development by bringing Internet to public and by driving digital platforms and their 4 main components: infrastructure, IT services, software, and users. Since that time the statistics show that 99.8% of businesses in Colombia have gone digital, in 2014 4G connections increased by 26% (from 215,218 to 808,762), 51.7% of Colombians and over 50% of homes are connected and in 2012 the Vive Digital Plan gain an award during the Mobile World Congress in Barcelona.
These days, Colombia is seen as an attractive investment destination and such technology leaders, as Google, Microsoft, HP and others are already opening innovative centers there. The BPO (Business process outsourcing) industry has already created over 246,000 job places, according to IDC 2014, and these numbers continue to grow. Find out more about outsourcing options with TEAM International and dedicated development centers in Colombia.