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Nordic firms to continue investing in IT outsourcing

posted onDecember 10, 2019
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Nordic companies are ready to spend more on IT outsourcing, a study conducted by Whitelane Research in cooperation with PA Consulting Group has found. Examining more than 1000 unique IT outsourcing relationships held by over 330 of the top IT spending organisations across all industry sectors in Denmark, Finland, Norway and Sweden, the study found that outsourcing will continue to increase over the next two years with 72 per cent of  companies planning to outsource at the same rate or more. 

Across the four Nordic countries, most outsourcing growth is expected in Denmark with 38% of organisations surveyed citing that they plan to outsource more. In contrast, most insourcing is 
expected to be highest in Sweden with almost 1 in 5 clients planning to outsource less.

The top three reasons for IT outsourcing from a client perspective in the Nordics are focus on core business, cost reduction and access to resources.  

On the overall ranking for general satisfaction, Indian outsourcing giant TCS and the US-based Amazon Web Services  received the joint highest score with 77%, followed by Norway’s Basefarm and US outsourcer Salesforce.com (both at 76%), Norway's Telenor and India's LTI (both at 75%). New entrant Paris-based Sopra Steria enjoyed 74%. 

Although Indian outsourcing is booming in the Nordics,  Hackernoon reports that “nearshoring” IT services to neighbours in Central and Eastern Europe  (CEE) gains momentum, given their high scores in terms of programming proficiency and level of English.

“And, according to the extensive report by Hacker Rank, developers from CEE are among the very best ones, with Poland securing the 3rd place — outscoring not only India but also United States, Japan and all of the Nordic countries” the independent tech media site writes.

“Although Eastern Europe doesn’t offer costs that are as low as those found in India or China, (…) it can argue that it provides better product quality, a proximity to Western Europe, cultural affinity, a better business environment, and high-level skills” Andrada Fiscutean from ZDNet told Hackernoon.

Not to mention that software developer salaries in the Nordics are skyrocketing. 

The Whitelane report also finds that new technologies focused on more efficiently and effectively delivering services such as robotics and artificial intelligence (AI) are becoming increasingly more important. 59 percent of all organisations are already using these new technologies and another 30 percent is planning to make use of this in the near future. While the use of technologies in Robotics and/or AI is widespread across the Nordics, Sweden is lagging behind the other Nordic countries.