ANALYSIS
concerns and enhanced
data protection laws
(particularly within the
EU), may put pressure
on outsourcing activities
there.
Countries with educated
workforces, stable governance,
solid currencies and good
technological infrastructure are
also projected to see growth.
The Deloitte survey
found that corporate
clients cared more
about outsourcing partner performance than their cost. A full 72% of respondents said offshore supplier performance was their main
outsourcing-related consideration. Cost advantage was
the second major factor, at 44%. Customer perception and time zone considerations were rated equally
important, at 28%, while social beliefs came in at 17%.
Particularly interesting for Macedonia – which has
played up heavily government incentives and assistance
in its promotional campaigns – was the finding that
government incentives were seen as the least important
factor in corporate outsourcing decision-making (11%).
Globally, Finance and Accounting outsourcing is
expected to increase in coming years, especially in
‘non-traditional locations.’ In Legal Services, meanwhile,
E-Discovery, Billing and Research and Analysis are the
sub-sectors most likely to become more outsourced.
Meanwhile, traditional HR sub-sectors such as Call
Centers (something from which Macedonia has particularly benefited) should also increase, with
Administration and other HR sub-sectors
expected to increase even more, with
between 20-40% of global respondents anticipating to step up their outsourcing ventures
in separate Administrative sectors. Tier 1
Customer Service is expected to grow at an
even higher rate, according to Deloitte.
The IT Sector – traditionally, one of the
Macedonian economy’s strongest beneficiaries of outsourcing – is also expected
to rise. IT is “typically the single largest
administrative cost for companies,” notes
Deloitte, and labor costs have always been
a main consideration
for foreign companies
outsourcing software
development and other
IT services to developing economies like
Macedonia. However,
increased demand for
Macedonian “computer
programming, consultancy and related
activities” already caused a 47% increase in the average
monthly net wage per employee between 2010-14. This
would suggest that the country’s labor cost advantage is
under serious pressure.
This is a real cause for concern, given the extremely
small size of the local industry. According to the Macedonian ICT Chamber of Commerce, in 2013 there
were just 539 active companies here with a total of
2,586 employees. Today, there are less than 15 outsourcing providers located in Macedonia advertising
their services online. They appear to have teams of
10-40 employees and largely focus on IT services,
though at least a few are also offering business process
outsourcing services.
However, the small size of local companies can actually
work to Macedonia’s advantage. In fact, the current
trend of large corporations moving away from “megadeals” towards a more “portfolio-driven” approach
reflects the more sophisticated and variegated nature of
the IT field today. To make up for a lack of large organizational capacity, small startups can concentrate on very
specific products and services to find their niche in the
larger sectoral ecosystem.
In the absence of any national statistics on local usage
of outsourcing services, AmCham Macedonia gathered
feedback from 16 of its members – which are larger and
more competitive than average companies – about their
use of outsourcing. The survey found that the majority
of respondents (62.5%) have long-term outsourcing
contracts with local suppliers, whereas the other 37.5%
reported that they occasionally outsource work locally.
Increased demand for Macedonian “computer
programming, consultancy and related activities”
already caused a 47% increase in the average monthly
net wage per employee between 2010-14.
Continued on page 23
Fall 2015
Issue 47 7