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Successful outsourcing requires many different strategies and tactics for survival. One such method involves making the most of different locations for service delivery. In this article, we take a closer look at how Capgemini optimised nearshore and offshore procurement to acquire talent and deliver its services more efficiently.
Featured in a leading study on Nearshore Americas, Capgemini’s VP of Client Engagement for the Americas, Steve Rudderham finds that:
As a new wave of emerging countries enter the global outsourcing business, the challenge is getting people comfortable with destinations like Africa, Russia and some Latin American countries like Colombia. For Capgemini’s Americas Business Process Outsourcing business unit, part of the answer is hiring English-speaking workers in Guatemala, a country that is unknown to many Americans but is on the same time zone and just a few hours away by plane from Houston, Dallas, New York or Atlanta.
Capgemini has had operations in Latin America for several years but its BPO segment in Chile, Argentina and Brazil (São Paolo and Campinas cities) has “taken off” only recently. 
According to Rudderham,
“Capgemini serves the rest of Latin America from Chile and its Portuguese- speaking clients from Brazil, but there is potential for these countries to serve U.S. clients as well if they invest more in English language training”.
 Guatemala is key to Capgemini’s operations in the region because labour is less expensive and more people speak English there than in Chile. Moreover, the Guatemalan government, in conjunction with MNCs like Capgemini, is promoting English courses in local universities. Capgemini also offers its employees flexible shifts so they can start building their careers while studying and later move up into better positions.
When it comes to skilled professionals such as accountants, India is still less expensive
“The cost differences get a lot bigger when you go up the scale and India is much cheaper, they are pumping out 3-4 million graduates a year,” says Rudderham. It is therefore not surprising that India is also a major delivery centre for Capgemini, and several of its key Accounts and IT operations are sourced from there. Capgemini calls this kind of selective outsourcing ‘rightshoring’. “We have to go after different markets because of the language… we’re trying to leverage where the talent is to put the BPO centers,” he adds. To reach U.S. clients, countries like Chile, Argentina and Brazil need to have “this second wave of educated, bilingual people fuelled and ready to go,” says Rudderham. For e.g., Chile offers good incentives and a conducive business environment, but the main benefit to Capgemini is the increased productivity it helps achieve, rather than lower labour costs.
Such subtle differences that exist between countries like Guatemala, Chile and Brazil are the reason MNC outsourcing bigwigs including Capgemini, IBM and Accenture have centers in various countries and regions, thus allowing providers to tap into the right talent in the right region.
Capgemini is a leading outsourcing services and consultancy provider which operates in 40 countries worldwide. It has copyrighted its deliver mechanism as Rightshoring®’, and calls this a mix of engaging multiple locations for delivering different services.
- Runa Mookerjee, Analyst,
ValueNotes Sourcing Practice
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- The Indian BPO Industry: Battling the Economic Downturn
- Global BPO: threat or extended opportunity?
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