Wednesday, August 04, 2004

IBM outsources to South Africa

This Computer Weekly news item says that IBM is using its operation in South Africa as a place to outsource to as a back-up to India. The skill sets and native English are every bit as good as in India, and the cost of that skilled labor is currently comparable.

The added advantage is that it is in the same time zone (more or less) as Europe, so communication is easier. (At least in theory -- the Internet infrastructure is nowhere near as developed as in India, as anyone who has ever waited minutes for a South African Web page to load will verify). An obstacle to any large-scale outsourcing to SA down the line may be the small size of the qualified workforce compared with India, which graduates 170,000 engineers a year (70 percent more than the US!).

But with recent government moves within South Africa to "partner with" India and Brazil in fields like e-learning, there may be some telecoms infrastructure progress in the pipeline, and maybe even some accelerated government investment in technology training. There's an interesting article on this in's archive, but irritatingly you can't get to it unless you are a paying subscriber (didn't that business model disappear years ago?).

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