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Vietnam in the Global Indexes of Software Development Outsourcing

 

Introduction

When it comes to global outsourcing services, there are some popular places to look at, like Asia/Pacific, EMEA, Latin America. Of course, the dominant positions for the best offshore software development belong to India and China. However, according to several pieces of research from Gartner, Inc., the investments in these traditional outsourcing countries have declined and shifted to the emerging alternative countries to diversify the sourcing strategies which meet the needs of multinational corporations. The IT buyers, for now, go beyond the cost reduction but also focus more on local-language skills, cultural compatibility, travel-time decrease, and same-working-day communications. With diverse choices for qualified offshore service providers, businesses could support their broader geographic footprints and establish their global delivery services wherever they are.

Among different offshore outsourcing choices, Vietnam is proven as a dynamic and productive environment for offshore software development in the APAC region. This country is where IT buyers who look for qualified and cost-effective talent pool. Let’s discover some quick facts about Vietnam rankings in different reports of global software outsourcing:

 

Vietnam's Rankings in Global Software Outsourcing Reports

  • Vietnam is ranked #5th in 2019 Kearney Global Services Location Index

2019 Kearney Global Services Location Index

 

  • Vietnam is one of nascent countries for digital maturity and high levels of cybersecurity protection (according to Kearney's 2019 report)

cybersecurity protection - Kearney's 2019 report

 

  • Vietnam is ranked #13th in TSGI Top 50 Digital Nations all over the world, according to Tholons Services Globalization Index 2019

TSGI Top 50 Digital Nations

 

  • Vietnam ranked #18th in the Tholons Top 100 Outsourcing Destination 2016

Tholons Top 100 Outsourcing Destination 2016

 

Vietnam as a Potential Offshore Software Development Hub

  • According to the Vietnam Software and IT Services Association, Vietnam software outsourcing has gained traction over the last decade with a revenue of US$8.8 billion in 2018, turning Vietnam into an emerging competitor of India and China.
  • Annually, more than 40,000 technical engineers graduated from universities entering the job market (2014 Vietnam Information and Communication Whitebook).
  • Several continuous investments in tech education, like US$55 million for Vietnam’s education technology (Edtech) in 2018 or US$4 million investment from a Hong Kong-based equity firm was given to Vietnamese startup Everest Education.
  • Some tech giants have outsourced to Vietnam, both in manufacturing and R&D: Intel, Samsung, Microsoft, Fujitsu, Foxconn, Panasonic, Bosch, Alcatel-Lucent, Amdocs, Avaya, Cisco, Juniper Networks NEC, Toshiba, Hitachi, LG, HP…
  • Ha Noi and Ho Chi Minh are always in the Top outsourcing of Tholons indexes, but Da Nang city, which is located in the center of Vietnam, also appearing to be an ideal and potential hub for ICT in general. The city was ranked first in the VietNam ICT Index 2016 (from the Ministry of Information and Communications of Vietnam).

Final Thoughts

As tech firms worldwide continue to use IT outsourcing as a part of cost optimization practices, you could choose Vietnam as a reliable nation for extending your technology capability with the most effective cost while mitigating the risk of sophisticated cyber threats.

 

CTA Enlab

 


References

The 2019 Kearney Global Services Location Index, 2019, kearney.com.

Tholon Services Globalization Index, 2019, tholons.com.

Tholons 2016 Top 100 Outsourcing Destinations - Rankings & Executive Summary, 2016, tholons.com

Pritesh Samuel, Vietnam’s IT Sector: 5 Industries to Watch, 2019, vietnam-briefing.com.

Gartner Says Alternative Offshore Locations for IT Services Are Emerging as Global Delivery Models Evolve, 2012, itone.lu.

Spotlight on Vietnam, the Leading Emerging Market, 2017, pwc.com

About the author

Nhu Nguyen

The intersection of marketing and technology has created the sweet spot to discover my Ikigai, either in my professional or personal life. Spending much of my career in tech, my passion is building elegant brands and data-driven marketing techniques tailored for the tech community.

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