Traditionally, offshore outsourcing has favoured low-cost Asian destinations, but, with the growth of the industry, more companies are now turning their eyes to the much nearer, both geographically and culturally, East: namely, Eastern Europe. It’s this part of the world which manages to forge the fortunate mix of affordability and top-class talent, with one particular country seeming to have it all, and more.
Nestled at the crossroads of central and eastern Europe – a strategic hotspot throughout history – lies Romania, your solid anchor of stability in a quite turbulent region. Romania has been labelled by investors an “outsourcing valley” for BPO, ITO, software development and research programs, knowledge process outsourcing (KPO), as well as for shared service centers (SSCs).
According to the 2016 A.T. Kearney’s Service Location Index quoted by Telus, Romania ranks as third most attractive outsourcing hub and patently steals the limelight when it comes to ITO –1st in Europe and 6th in the world by number of certified IT specialists. Romania is also the fastest growing market in the European Union in terms of IT outsourcing services.
Over 60,000 of Romania’s employees work in the local outsourcing sector, which is estimated at 1.2 billion Euros and increasing by at least 20 percent every year.
Now, just what makes Romania such a magnet for foreign investors? And why would you choose Romania over any other outsourcing destinations? Here are 9 decisive reasons:
1. A perfect balance between cost and quality
Previously, outsourcing meant simply picking the lowest wage locations and dealing with the inevitable flaws later. The truth is that cheap work comes with cheap results and today outsourcing is no longer about (just) cutting costs – it is about getting stuff done faster and more proficiently, it is about innovation, not replication. Companies are now looking to outsource their services to places that offer above all quality work, nevertheless at reasonable prices. Outsourcing to Romania allows companies to achieve the perfect quality/cost ratio.
Romanian hourly rates are still low compared with western countries, but higher than those in India for example. What makes Romanian costs extremely competitive is the workers’ multilingual, technical and soft skill proficiency. For instance, when outsourcing software development to Romania, a western company will reduce costs by 30 to 50 percent while at the same time benefiting from Romanian developers’ superior level of seniority and execution as compared with Indian counterparts.
2. Raw, sparkling, highly-educated IT talent
As we mentioned earlier, Romania boasts the first place in Europe and the sixth in the world for number of certified IT specialists.
A flourishing technology hub, Romania hosts around 50 offshore centres owned by large international IT vendors – Microsoft, IBM, HP, Oracle, Wipro, S&T, Accenture, WNS, Intel, Ubisoft and Amazon, to name only a few. Over half of these are BPO centres, 30% are IT services-related centers and less than 20% are R & D facilities.
A generous pool of more than 100,000 people is working in various ITO-related fields, from which around 60,000 are highly qualified specialists: programmers, developers, software engineers. Web and software development outsourcing, as well as web design outsourcing are continually on the rise, thanks to a consistent offer of talented professionals able to easily adjust to their clients’ demands.
This human potential has impressed, among many others, Darren Overby, an American entrepreneur, who learned about Romania after posting a small project on vworker.com. Here’s an excerpt from one of his blog posts evoking the businessman’s exquisite Romanian experience: “The following day I was truly amazed at how quickly they got to work. It’s the first time I’ve ever witnessed programming in parallel. Everyone immediately checked out the framework and initial code base from the SVN server and got to work. Within the course of 12 days, we rebuilt the hostel front desk system and got everything mostly done.”
And the IT sector is becoming more and more paramount for the Romanian economy – this year has seen a 15,3% growth over the first quarter 2016, resulting in a contribution to the GDP of 6,2%.
3. A polyglot workforce
Romanians are reputed internationally for their strong foreign language competences. Almost all Romanian pupils (95.2%) study at least 2 foreign languages, according to Eurostat, placing Romania in top 5 European countries in this category. As per the latest Eurobarometer report, 31% of the entire Romanian population speaks English, 17% speaks French and 7% Italian.
Brainspotting IT & C Talent Map 2015-2016 states that all IT & C professionals in Romania are proficient in the following five main languages:
English – 98.38%
French – 27.45%
Spanish – 12.95%
German – 9.92%
Italian – 6.90%
And, if you happen to hail from another language speaking country, fluency in several other foreign languages is also available: from Portuguese and Hungarian to Czech, Slovak, Bulgarian or Russian. This diverse linguistic profile makes Romania especially attractive for BPO operations which require tons of customer interaction.
4. Cultural compatibility
A country with 100% European mindset, where you won’t need to worry about business etiquette or getting across your more sophisticated messages. Your average Romanian employee is a cosmopolitan, multilingual and perfectly adaptable individual, with a high commitment to projects and client relationships. While the more traditional outsourcing providers in Asia are known for saying “yes” to a customer’s requests without questioning, Romanian business professionals will challenge you with their innovative approaches to achieve shared goals. What you get in the end is flawless communication, true partnership and more value than you bargained for.
5. Great ITC infrastructure
According to reports, Romania enjoys the fastest broadband internet in Europe, with a peak speed of 58.7 Mbps, which is also the 7th fastest speed in the world. US Senator Bernie Sanders is famous for his “envious” tweet about this Romanian performance: “Today, people living in Bucharest, Romania have access to much faster Internet than most of the US. That’s unacceptable and must change.”
6. Ever new investing opportunities
Romania has the advantage of being a developing country, with a huge unexplored business potential, talents eagerly waiting to be discovered and willing to sacrifice anything to see an idea through until fruition. The country is luring in more and more foreign direct investments in outsourcing, manufacturing, and services – during the first two months of 2017, FDI in Romania sky-rocketed by 85%.
7. Smaller cities getting in the outsourcing game
From a total of 1.2 billion Euros, the value of the outsourcing sector in 2016, 63% is accounted for by Bucharest. However, Romanian outsourcing is no longer restricted to the capital and, since many of the BPO companies present in Romania have expansion plans for the following years, next in line are the so-called Tier 2 cities – such as Cluj, Iasi, Timisoara, Sibiu, Brasov, Craiova – but also third hubs like Suceava, Galati, Constanta, Pitesti or Ploiesti. These come with a good infrastructure and real estate offer, universities and surprising skill levels coupled with genuine passion (see Darren Overby’s account about Cluj at point 2).
8. Political and economic stability
According to Eurostat, Romania is the 16th largest economy in the European Union by total nominal GDP and the 13th largest based on purchasing power parity – and growth prospects are more promising than in the rest of the region. Our country offers a stable macroeconomic environment and monetary policy – the exchange rate has remained largely stable with a fluctuation of maximum 2% over the last couple of years. This along with delaying Euro adoption turns Romania into a strong magnet for foreign investments.
9. Brexit blowing wind in Romania’s sails
Brexit has opened a window of opportunity for the CEE region, which is already preparing to accommodate foreign businesses that are currently based in the UK. On the other hand, British companies will still want to capitalize on outsourcing, since the lack of IT specialists migrating from Europe could lead to a talent shortage. Romania is readier than ever to take on your outsourcing needs!
Romania is quickly becoming the outsourcing destination of choice for companies from all over the world seeking a highly-educated, multilingual, hard-working, easily adaptable and cost-effective talent pool in a stable economic and political environment. Move to Romania and upgrade your outsourcing!