Vietnam poised to build on IT outsourcing gains
Apart from skills and adaptability, low staff turnover in the sector makes the country more attractive to tech giants.
Vietnam continues to be a favored outsourcing destination for multinational companies even as the current leader, India, experiences some hiccups.
A recent article in the Forbes magazine said in its title that Vietnam was a “small but mighty powerhouse” for IT outsourcing.
It said giant technology companies like Intel, IBM, Samsung Display, Nokia, and Microsoft continue to invest in Vietnam’s growing tech workforce.
The author of the article, Anna Frazzetto, Chief Digital Officer and Senior Vice President at Harvey Nash, which has a decade plus of outsourcing experience in Vietnam, said, “technology specialists in Vietnam are comfortable with quickly becoming a natural extension of global clients, ready to challenge norms and bring innovative ideas to the table.”
Another major factor that makes Vietnam attractive is the tendency of people to stay on in the country, unlike IT professionals in India, Malaysia and other countries who are ready to move to other countries for jobs that pay well.
While the relative lack of fluency in English is a growth constraining factor, Vietnam’s investment in education, and the extra attention it pays to nurturing knowledge and talent in science and math is a positive aspect that will help Vietnam build on its outsourcing potential, she said.
These positive factors have meant that business process outsourcing (BPO) is growing fast in Vietnam. In 2017, consulting firm PricewaterhouseCoopers (PwC)’s “Spotlight on Vietnam” report also indicated that BPO was among the country’s most five promising sectors to invest in.
Also last year, the Vietnam Software and IT Services Association (VINASA) said the country’s BPO industry has grown 20 to 35 percent annually over a decade.
A Global Services Location Index report in 2017 by A.T Kearney consulting firm said Vietnam has jumped five places to sixth for countries with great financial attractiveness, availability of highly skilled people and good business environment. The five countries above Vietnam were India, China, Malaysia, Indonesia and Brazil.
Dinh Thi Quynh Van, general director of PwC Vietnam, said in a Voice of Vietnam report earlier this year that Vietnam’s BPO was following a similar growth trajectory to that of India and the Philippines.
But she said Vietnam’s BPO workforce should stay innovative to meet ever-increasing demand in the market.