Advances from 29th position in 2007 to 16th position in 2009
The consulting giant, A.T. Kerney’s Global Services Location Index (GSLI) index identifies the top 50 countries for outsourcing globally. The Global Services Location Index (GSLI), first established in 2004, analyzes and ranks top 50 countries worldwide as the best destinations for providing outsourcing services, including IT services and support, contact centers, and back-office support. Each countries score is composed of a weighted combination of relative scores on 43 measurements, which are grouped in to three categories: financial attractiveness, people skills and ability and business environment.
Sri Lanka is ranked number 16 in the index in 2009 comparing to the number 29 position held in 2007. This is a significant jump of 13 positions and only one or two other countries that this level of upgrade of the ranking. The report was complied with 2008 data prior to the war ending. With war situation behind Sri Lanka the actual ranking would be even higher now. The report positively stated that Sri Lanka has been promoted the ranks assisted by low costs compared to the rest of the destinations. The combination of high people skills, favorable business environment and low cost enables India, China and Malaysia to be in the top three slots.
“AT Kearney Index outlines clearly the potential of the IT/BPO industry in Sri Lanka. As the global economy begins to bounce back, we will have a tremendous opportunity to a share of the global IT/BPO market which is estimated to be over $ 350 billion.” said Ranjit Fernando, Chairman of SLASSCOM.
Commenting on the Index, ICT Agency’s Chief Operating Officer, Reshan Dewapura mentioned that “the latest AT Kearny Index is a clear indication that Sri Lanka is on the correct path to realizing the vision of making the IT/BPO sector the number one foreign exchange earner for the country. The great strides taken by the Industry backed by the government’s support and commitment have been major contributory factors in this achievement”
Weakening cost advantages and enhanced labor quality are driving a dramatic shift in the geography of outsourcing according to the latest edition of global management consulting firm. The report prepared in 2008 analyzes Sri Lanka taking off as a global outsourcing destination, steadily since 2005. The A.T. Kearney report points out Sri Lanka as a outsourcing destination is advantages considering proximity to India, and the increase supply of the number of UK qualified Accounting and Finance professionals, allowing the country to function as a backup to Indian outsourcing centers.
The geography of the outsourcing is changing fast. Countries that were a safe bet few years ago, and still attract large investment in the industry may already have peaked and be in decline as future destinations. Relatively unknown locations today may be important destinations tomorrow. The number of counties competing for the outsourcing business steadily expands and the different niche markets that countries serve multiply. Location decisions are not as straight forward as they used to be.
In addition, the economic crisis is creating further volatility as it reshapes the outsourcing landscape. In the short term, the recent decline in growth will continue, and the crisis will likely shake up the current outsourcing geography as countries deal with the volatility with varying degree of success. Over the long term, the crisis may trigger further globalization of services.