Jose A. Diaz Infante
Want to know how to convince your boss that Mexico is an outstanding destination for IT services? Want to know how to win a debate against intelligent, experienced and eloquent individuals representing Eastern Europe and Asia?
I did just that at the recent International Association of Outsourcing Professionals (IAOP) meeting that was held last Tuesday, May 6th in New York City.
The event was centered around the theme, Battle of the Service Delivery Destinations. I was part of a 
panel entitled Why my location is best for outsourcing. It was moderated by Deloitte Consulting, and I joined panelists from Luxoft (representing Eastern Europe), Insigma (representing China and East Asia), and from Merck (representing the client-buy side).
With the advantage of being the last person to speak, I was able touch on the arguments made by representatives from Eastern Europe and Asia, and complement with my experience working with clients that have reaped benefits out of Nearshore.
Here are the arguments I made:
1. Nearshore Provides the Agility American Companies Need In Their Digital Transformation Journey
Proximity enables agility. Agility is the number one priority for digital projects. Most companies today are at some stage of their journey towards digital transformation. They require faster times to market than ever before. This requires agility from their outsourcing vendor, which means solving problems quickly, working in the same time zone, and being available for frequent and close collaboration.
Hiring an outsourcing partner with operations with locations in Mexico or other Latin American locations, enables a company to transform rapidly because they share the same time zones as their clients, making it easy to react quickly and work on an agile basis.
Let’s take an application bug for example. How much does it cost a company in any industry to wait up to 24 hours for somebody to rewrite the code and send the correction to production? That’s how long you may have to wait if your outsourcing provider is on the other side of the planet. You send the spec at the end of your work day, you get the code in the morning, but there is a bug, you send it over for correction –but it’s night time in China; finally, you get the bug-free code the next day in the morning, a 24-hour cycle.
But the time zone advantages of Nearhsore makes it easy to fix a bug and improve a page, test code quickly and easily; if you discover a bug in the morning, your Nearshore provider can solve it that morning.
2. Nearshore Provides the ‘Right Place’
Right-placing: The work should be located wherever makes the most sense for the specific engagement. Sometimes India, Russia or China are the right locations, but many times they are not. If your company is based in New York or anywhere in the U.S., it’s much easier to support operations from a company in the Americas. Beyond cost, there are other factors to consider.
New York City is only a four-hour flight to Mexico City, and cities like Houston, Dallas and Phoenix are only two hours away, making it easy to visit your outsourcing provider.
And if you need somebody to work onsite for a while, trade agreements between Mexico and the U.S. make it very easy to obtain the free trade NAFTA work permits to make this happen
3. Nearshore Offers True Cultural Affinity
Some of the panelists argued that their region had greater cultural affinity with the United States. Culture can be a tricky subject, because it is intangible, and countries like India have done a great job in attenuating differences in terms of customs and traditions. So let’s focus on the more tangible aspects of affinity.
México is the third largest trading partner of the US. Mexico buys more products and services from the US than all the BRIC countries combined. Furthermore, Mexico and the US have the most connections through air travel than any other two countries in the world.
Finally, Mexico and the U.S. are inextricably linked by more than a century of shared history, a common border, and cross-migration. That’s a lot of cultural affinity, which makes for better understanding, a better working relationship, and similar ways of thinking.
4. More Engineering Students as a Percentage of Population Available Just a Short Plane Ride Away
One last point by a panelist was that time zone was not enough, that you need the skill set to serve your customer. I totally agree! As a percentage of population, Mexico has more engineering graduates than the US. My company, Softtek, has played an important role in supporting STEM education with robust training and university linkage programs to create this talent. That’s a lot of talent available just a quick plane ride away!
Conclusion
While representatives from each location had their own unique points of view and presented advantages for their regions, I think Mexico won the debate. I believe I made the point that Mexican Nearshore offers the most advantages for American companies. The agility, the right placing of talent, the cultural affinity and talent of the region can be strategic for American companies in the journey of their digital transformation strategy.
If you need to convince your boss about the advantages of Nearshore, use the arguments above – and let me know how it worked! Value through technology ! Value from your outsourcing partner.
Jose Antonio Diaz Infante is the MD Financial Services & Insurance for Softtek North America. He has over 15 years of experience outsourcing IT, Procurement & HR work to different locations of the world.
