FlexDev Predicts a Shift in Offshoring to Nearshoring Due to COVID-19

 Polish-based award-winning outsourcing firm FlexDev predicts a shift in outsourcing IT and Finance functions, due to the COVID-19 pandemic, forcing business leaders to rethink their outsourcing destinations. The change could see jobs being brought back in-house locally or see companies leveraging a nearshore delivery function to gain more control and reduce risk. During this downtime for businesses, created by the world COVID-19 pandemic, business execs are starting to re-evaluate and are rethinking their outsourcing strategy including models, and destinations, according to FlexDev's Executive Vice President, Graham Fell.
Multiple reports on CE business services show Poland is often measured on the number of employees, which is relevant for transactional processing but not for companies delivering high value-adding services and solutions such as software development. Poland should no longer be viewed as a cheaper alternative for services outside of transactional processing, but more of a centre of excellence for delivering high value-added services and solutions. Polish developers are ranked third in the world at Hackerrank.

"Companies need to not just focus on a cheaper workforce, but more on quality of services. Poland is transitioning to a destination of best-in-class business professionals which ultimately improves the quality of services, ultimately drives down the cost, ensures tighter compliance, and ensures UK companies can re-gain more control while reducing the risk," confirmed Graham Fell.

Elias van Herwaarden, Founder of "Locationperspectives" and visiting professor at the Faculty of Business and Economics, commented: "Nearshoring will gain a bit of momentum, indeed. But given the wage cost differences with far-shoring and the nature of the work sent to e.g. India or the Philippines, I do not expect a one-on-one transfer-back. Nearshore wage costs and employee aspirations simply are prohibitive to re-shoring the very transactional work that was sent to low cost countries across the globe AI and RPA as the more likely response. GBS and SSCs will very likely bring the processes back home - on-shore and nearshore. They will increasingly opt for distributed, networked service delivery models. Locations with mature shared services/delivery ecosystems could benefit from this. At least if they can adequately respond to an accelerated need for digitally educated and STEM talent."

"Polish people have a strong educational background. According to the New York Times, almost 40% of Polish people aged 25-34 have university degrees which thrusts the country into the top rankings in Europe when it comes to education. This is good news when looking for top talent," added Mr Fell.

Poland focuses on leveraging cutting-edge technologies that are up-to-date with the latest trends and technologies. Polish people are also experts when it comes to agile and scrum methodologies for software development. This is very appealing to companies that want to outsource as Poland is ahead of the game when it comes to keeping up with technology shifts.

"Culturally there is very little difference between Poland, the US and other European countries. This contrasts with the top outsourcing software destinations – China and India. Poland also boasts excellent language skills ranking ninth in the world in the EF English Proficiency index 2015 and 10th in the 2016 edition, getting ahead of most Eastern European countries. Poland offers a stable and healthy economy, a highly skilled workforce, a dynamically growing IT market and US and EU standards in IP protection and data security," confirmed Mr Fell.