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ATI Alternatives to India

Outsourcing Institute Roadshow June 9, 2011

Sponsored by: The Outsourcing Institutes Road Show Events Produced & Presented by: The Outsourcing Institute

Panelists

Judy Arteche-Carr Arteche Global Group judy@artechecarr.com

Janet-Lee Hatt The C&L Group jlhatt@theclgrp.com

Marty Pine Moderator mpine2@gmail.com

Lance Paglierani Spi-global Lance.Paglierani@spi-global.com


ATI Alternatives to India

Luis Saldana Dextratech lsaldana @dextratech.com

Maykol Lopez Procomer mlopez@procomer.com

Offshore/Nearshore Sources
India the Leader
Market Maturing (WSJ April 2011, Bloomberg May 2011))
Wage Inflation (+12% Bloomberg) Attrition (17% Average Nasscom, 55% Call center) Shortage of Skilled Workers (25-30% wage jump for experienced workers) Regional/Language Differences Workforce Management Profitability ( 10-12% down from 35% ) Offshore Insights Clients Resist Paying More - Contracts Maturing - ReNegotiations

Alternatives Growing - 56+ Nations Providing Services


Europe / Africa
Ireland, Northern Ireland, Poland, Czech Republic, Romania, Bulgaria, Egypt, Israel, Ukraine, Russian Federation, South Africa, East Africa

Asia / Far East


South Korea, Philippines, Vietnam, Thailand, China, India, Pakistan, Singapore, Malaysia

The Americas (Nearshore)


Brazil, Venezuela, Argentina, Mexico, Canada, Chile, Caribbean, Domestic/Rural US
ATI Alternatives to India

Recent Article
Outsourcing customers should stop looking for the next India because it doesnt exist. Instead they should look to leverage the unique strengths of different geographies (such as location, culture, and skills) to create the right portfolio of outsourcing sites for themselves.

India is unique
Sheer size of labor pool Low labor costs Maturity of the outsourcing industry which comparatively easy and low-risk Good English skills and cultural compatibility with North America and Western Europe

Compared to India
Mexico, Brazil and China all fall short in one or more dimensions

May 18, 2011 Stop Looking for the Next India The Delivery Report

ATI Alternatives to India

Global Shoring Ecosystem


Nearshore: Canada

Offshore: Ireland

Offshore: Russia

Onsite/ Offsite Nearshore: Mexico Nearshore: Caribbean

Offshore: China Offshore: Philippines Offshore: India

Nearshore: Easier travel Cultural similarities Time zone Security

Offshore: Lower costs Time to market Resources Quality Scale


Current Priorities Mature options

ATI Alternatives to India

Longer-Term Prospects

Indicative Global Annual Wages & Benefits

BPO Examples India - $ 7,779 China - $ 7,634 Philippines - $ 9,844 Romania - $ 12,691 Mexico - $ 17,899 Costa Rica $17,420 Brazil - $ 13,163
Domestic Sourcing (Example) ITO - $51,687 BPO - $31,423

Source: NEOIT

ATI Alternatives to India

Nearshore/Offshore Realities No One Wakes Up In The Morning and Says


We Can Solve ALL Our Problems by Going Offshore

While Cost is Important


No One Ever Admits to Buying From the Low Cost Provider (Hyundai) The Goal is To Get More Done for the Same or Less Budget The Amount of Savings Can Be Mitigated by Perceived Risk & Comfort

Note: If You Save 25% Vs 40% ==== You Still Saved 25% Note: Changing Question Why Does It Cost So Much? vs. How Much Can We Save?

ATI Alternatives to India

Risks/Values to be Considered-Managed
Vendor/Location Geopolitical Risk Socioeconomic Risks shareholders and local community Country Factors location differences Vendor Landscape quality, maturity, domain expertise, technologies Cultural Differences Legal/Contractual regulations and standards, compliance Processes Knowledge Transfer what is best way Change Management requires methodology and accountability Problem Escalation BCP/DRP security, privacy, ISO17799/BS7799, CoBIT, Safe Harbor, Patriot, SOX,EAR,ITAR End of Term what happens if it doesnt work/when its over Financial Total Cost of Ownership (TCO/ROI) Workforce Management inflation, attrition, resource pool, time to hire, . Pricing currency fluctuations and scope creep Treasury exchange rate, COLA, inflation, interest rates, etc Government Incentives
ATI Alternatives to India

Questions?

mpine2@gmail.com 732-735-7200 732- 735-

ATI Alternatives to India

Judy Arteche-Carr
Judy Arteche-Carr is a strategic advisor to global companies, CXOs, and governments focused on business strategies, global sourcing and emerging technologies. She has worked with management teams in the transformation of organizations and business alignment to IT at Salomon Brothers (Citigroup), JP Morgan , EDS, and Unisys. Judy focuses on resource management, energy management/green IT and sustainability. Judy serves on the Boards of the Society for Information Management (SIM) International and SIM New York Metro, CIO Without Borders and the Philippine BPO/IT Advisory Council. She is a frequent speaker in New York and global conferences.

judy@artechecarr.com

ATI Alternatives to India

Janet-Lee Hatt
Vice President Outsourcing & Delivery The C&L Group Janet-Lee is a highly accomplished senior executive with over 30 years of experience directing technology practices with a focus on outsourcing/ rural sourcing strategies. Janet-Lee manages the C&L rural sourcing facility in Reading, PA and is responsible for the development of all processes to support Enterprise Application solutions, QA testing practice, and all outsourcing initiatives. jlhatt@theclgrp.com Janet-Lees thirty-year career includes senior management positions at Computer Horizons Corp., Kaiser Permanente, and Wells Fargo Bank. As Sr. VP at Computer Horizons, Janet-Lee was responsible for the management of the Montreal outsourcing center and the development of Computer Horizons robust sourcing strategy. This strategy includes a flexible delivery model, detailed transition and knowledge transfer plans, sourcing financial models, SLAs, and development, production support, and QA testing methodologies.

ATI Alternatives to India

Maykol Lpez
Director of The Foreign Trader Corporation of Costa Rica PROCOMER He is an outstanding economist with a Master Degree in Economy and with more than 11 years of experience studying market opportunities and promoting Costa Rican companies and industries through several markets among Central America, the Caribbean and United States. He was the Director of PROCOMER in Puerto Rico for almost six year, and during 2008 he was posted to oversee the CARICOM market. He developed commercial and marketing strategies for industries like the food processing companies, the fresh produce, and providers for the medical device industry; and to lobby through government entities to allow entrance for some products to their territory. Maykol was chosen to lead the commercial strategy to introduce Costa Rica and PROCOMER in China with the reestablished Diplomatic Relations between Costa Rica and China. He had participated in multiple market studies to evaluate the feasibility and potentiality of wide range of products and services abroad. He worked as analyst for the Research Institute of the University of Costa Rica. He taught economics and mathematics in several universities in Costa Rica and Puerto Rico.

mlopez@procomer.com

ATI Alternatives to India

Lance Paglierani
Lance Paglierani is recognized for having 12 plus years experience in business development/marketing within the Outsourcing, telecom and healthcare industries. Lance currently works for SPi Global as a Senior Manager for North America and consults with fortune 1000 companies on providing outsourcing services in the BPO and contact center sector. Experienced in end to end outsourcing solutions from contracting to delivery in areas such as contact center, technical support, customer service, marketing, social media and back office, among others. Global experience in the Asia markets such as the Philippines and Latin America where Lance has helped transition multi-national Fortune 500 companies. Lances experience in Telecommunications and Healthcare has given him a versatile background having worked for major Fortune 500 companies in various positions such as business development, marketing and consulting. Including experience with AT&T and Reliance Communications focusing on providing a variety of technologies which helped enable and enhance business processes. While at Bayer and Sanofi-Aventis, Lance served marketing positions working with hospitals and healthcare organizations out of the Boston and Rhode Island areas. Lance is a graduate of the State University of New York at Brockport in 1996 with a Bachelor of Arts and is currently very active in the outsourcing industry participating in a number of organizations and co-chair of Life Sciences Chapter out of NYC. LinkedIn Profile: http://www.linkedin.com/profile/view?id=18547508&trk=tab_pro Social Media Bitac Panel in Puerto Rico: ://www.linkedin.com/share?viewLink=&sid=s374796069&url=http%3A%2F%2Flnk d%2Ein%2FGty4ze&urlhash=NQoj&uid=5472600749433171968&trk=NUS_UNIU _SHARE-lnk ATI Alternatives to India Lance.Paglierani @spi-global.com

Marty Pine
Marty Pine is a recognized thought leader and an internationally known Global Business Services Professional who has worked as a senior executive in customer, provider and advisor companies. A foremost outsourcing expert for the last 20 years, Marty has deep experience and contacts in India, the Philippines, China, Russia, Eastern Europe, Brazil, Latin America, and domestically. Before Outsourcing was called Outsourcing, Marty was the US President responsible for sales and project management of three (3) joint ventures from India. Marty created and executed the strategy to sell project based work versus body shopping. As an expert in BPO / ITO / KPO and the Office of the Future, Marty has been an innovator in the use of internal and external providers to achieve operational process improvements, increased efficiency/productivity, and to drive operating units to meet cost management objectives. Leveraging an expert knowledge of multiple Outsourcing Models, Pricing Models, Shared Service Centers, Utility Computing and M&A activities, Marty is an accomplished Senior Executive with a proven track record of success in Operations, Delivery, Development and Sales/Marketing. Marty has held a number of Senior Management and Advisory positions: As the SVP Global Strategic Sourcing, at a major Property & Casualty Insurance & Re-Insurance Company, he outsourced over 2,200 resources in ITO / BPO / KPO while reducing costs by more than $170 million year over year. As President of his own Sourcing Advisory firm, GO!-Global Outsourcing, which he eventually sold, Marty worked with Client s, vendors and venture capital firms. For Client s, he was the US advisor for an outsourcing deal worth $5.2 Billion, re-transitioned an outsourced deal to in-sourced, helped identify M&A target and integrate M&A activities, and set up shared service centers. For Provider firms, Marty helped create strategies to differentiate them, rolled out Global Delivery Models, and trained and hired sales teams. For venture capital firms, Marty helped to reduce run rates and allow their products/services to come to market, while reducing burn rates for startup investments. While at a Global Multi-National Provider Marty was the Account Executive responsible for Applications only Outsourcing worth $1.2 billion while re-badging 1,800 employees. Part of his responsibility was to move 15% of the contracted work offshore, when no one else had ever been offshore. Marty also built a Remote Work Management practice and created/ran a cost center with multiple shared service centers (US, Canada, Northern Ireland) and offshore vendor partnerships, which resulted in competitive consulting rates and increased margins. Prior to his success in outsourcing; Marty also owned and took a software development firm public and was named CEO/Chairman of the Board. He had worldwide development, manufacturing and sales P&L responsibility for the system that precedes the PC into the marketplace . As part of this effort, Marty hired and trained a dedicated sales force and created one-to-many marketing programs. Marty is a frequent speaker at Outsource World, World BPO / ITO Conference, World Sourcing Forum and other conferences. He also enjoys teaching MIS and Outsourcing as an adjunct faculty member at multiple universities MBA programs. Marty has also developed a web blog for the NYTimes and Outsourcing.About.Com ATI Alternatives to India

Thought Leader, Outsourcing, Delivery, Innovation


mpine2@gmail.com

Luis Saldana
Luis was appointed on business development responsibilities in 2008. Prior to that he served as VP of Operations; he has been instrumental in defining Dextra Technologies operational practices. Luis is responsible of technological strategy, the creation of business partnerships to increase company value proposition and the development of new business. He has served Dextra Technologies since 1998. Luis holds a BS degree in Electronic Systems and an MBA from the ITESM. He is a member of the International Association of Outsourcing Professionals and OneMBA alumni.

lsaldana @dextratech.com

ATI Alternatives to India