Egypt is a Finalist for the Outsourcing Destination of the Year 2016 Award

European Outsourcing Association, EOA, unveils its 2016 shortlist.

Abundant multilingual talent supply, competitive operational cost, attractive business environment, entrepreneurship and innovation, together with government support, qualified Egypt to compete for the prestigious European award.

CAIRO, Sept. 8, 2016 - Egypt has been shortlisted as the Outsourcing Destination of the Year 2016 for the European Outsourcing Association (EOA) Awards, one of the most prestigious outsourcing industry awards. The EOA is the center of excellence for outsourcing in Europe. It is committed to advancing the outsourcing profession and the outsourcing industry by driving awareness, education, standards and thought leadership. Winners will be announced next October, following the EOA Leadership Summit in Bulgaria, which gathers the global sourcing leaders and influencers.

Recent years witnessed a shift in the outsourcing landscape in Egypt from low-value to high-value services. BPO, IT and R&D outsourcing services have mushroomed over the last four years, with employees doubling to reach around 50,000 FTE. The contribution of Egypt's ICT industry to GDP grew by 13% in the last two years, reaching 4.1% of total GDP. In 2015, the Egyptian Information Technology Industry Development Agency, ITIDA, created 6,000 new jobs through expansion agreements with MNCs.

This year, ITIDA features the innovative and collaborative environment in Egypt through its investment in the newly established company, Silicon Waha, for establishing science and technology parks across second-tier cities. This countrywide initiative encompasses a collaborative ecosystem of government, ICT companies, academia and entrepreneurs and creates 500,000 jobs. By the end of 2016, two parks will be operational under the name We Parks, one within Alexandria city, covering the coastal area, and the other within Assiut city, covering Upper Egypt. We Parks complement the portfolio of the successful Smart Village and Maadi Technology Park in the capital. Moreover, ITIDA's affiliate, the Technology Innovation and Entrepreneurship Center, has launched the Innovation Clusters Initiative to develop an Innovator-friendly environment in Egyptian cities based on a Public Private Partnership.

The country has an abundant talent pool, with 500,000 annual graduates from more than 35 universities and 100 institutes, 50,000 of which are IT-related, while 220,000 are BPO-related. Its peerless multi-lingual labor is able to serve more than 20 languages across 100 countries.

Compared to other outsourcing destinations in Europe and Asia, Egypt enjoys an exceptionally low attrition rate. Against this background, the country is heavily investing in skills development and talent management. The Next Technology Leaders, NTL, is an initiative to qualify 16,000 Egyptian youths in the ICT field through online and interactive training in collaboration with MNCs, Egyptian universities, and learning institutions.

Egypt's enhanced position is reflected in recent influencers' reports, including Gartner, where Egypt was identified as a primary destination for sourcing and IT services in EMEA. Everest Group's "Putting Egypt Back on Your Location Radar" evaluated the current global services delivery landscape in Egypt. Oxford Business Group cited Egypt's outsourcing industry as going from strength to strength while Forbes ranked Egypt among top 10 countries to launch start-ups. Raconteur ranked it among top 10 emerging countries for outsourcing, and the IMF revealed Egypt as the second largest economy in Africa, ahead of South Africa.

Egypt received the EOA Offshoring Destination of the Year Award in 2010, surpassing Philippines, Colombia, and Sri Lanka. The award recognized Egypt's growing position in the global market and highlighted its competitive advantages. This year, Egypt is competing with Belarus, Fiji, and Sri Lanka; solid strategies, flagship projects, and positive indicators make it a strong candidate for the 2016 award.

AbdelRahman El-Mawawi
Senior Media Researcher
ITIDA
+202 3534 5210
@ITIDA

Growing beyond manpower outsourcing - Arab News

Growing beyond manpower outsourcing - Arab News

Bassem Bouzid has been appointed to the position of regional VP and GM for HP Enterprise Services for the Middle East, Mediterranean and Africa (MEMA) region. In his new role, Bouzid will provide leadership for HP’s Enterprise Services business in Greece, Turkey, the Middle-East and all of Africa. HP stated that Bouzid’s appointment is a “clear demonstration of HP’s strategic focus to develop its Enterprise Services business in this important growth region and to become the recognized leader in services.”

Prior to this appointment, Bouzid was sales VP for the Energy and Distribution Industry (EDI) within HP Enterprise Business, Europe, Middle East and Africa(EMEA). According to HP, Bouzid’s focus will be on growing the IT outsourcing and application services business throughout the region, targeting the energy, financial services and telecommunication sectors as well as digital health solutions. In an interview with Arab News, Bouzid added that he hopes to be working with the government and education sectors as well.
Asked how Greece was added to the Middle East/Africa grouping that usually only includes Turkey from outside the immediate regions, Bouzid advised that HP felt there was some potential to increase the sharing of resources.

“The issue is the critical mass that each market would require on its own,” Bouzid remarked. “Everyone is aware of the financial crisis and the situation in Greece. There are more commonalities between Greece, Turkey and the Middle East, than between Greece and some of the Western European countries and we want to cover Greece because there is still a good market there. The requirements, the cost base, the type of solutions needed in Greece are more those of growing markets than mature markets.”

Bouzid believes that his appointment is another incremental move in the massive corporate transformation that HP has undertaken over the last four years.

“We have greatly expanded our sales coverage related to global enterprise accounts,” he said. “Now we have more dedicated coverage on what we call the Global 2000 accounts. These are the 2000 largest IT spenders globally. In the Middle East and Africa there are a few of those and in Saudi Arabia, it’s one of the highest concentrations of those clients that we have.”

With Bouzid’s focus on enterprise services, it immediately comes to mind that he will be HP’s regional team leader for outsourcing, encouraging local enterprises to contract HP to take over some or all of their IT operations. Bouzid immediately clarified that for HP, enterprise services are not just manpower outsourcing. Their offerings span requirements from helping companies set up their technology - be it hardware, software or business applications - to running their operations.

“Outsourcing, in the definition of outsourcing in Western Europe, is shifting workload. There are usually just a few items you can play with when you are going into outsourcing to generate savings and improvement,” Bouzid said. “Of the items you can play with or the levers you have in the outsourcing world, the first one is labor arbitrage. This one has been used extensively in the region by bringing to the region the offshore resources that are used in Europe remotely. So there was already a shift of the low level commoditized activities. That’s the first level. Usually, that is not sustainable because markets grow, economies grow, salary base grows and quickly your business case falls apart.”

He continued, “The second level that you use, which is more sustainable, is transformation. You take an operation and you transform it so you require less technology. You automate more intelligently. You need staff with higher skill levels in order to operate such an environment. Usually this is more sustainable because you are really changing an environment long term. Rather than taking jobs away, in fact it creates space for those highly skilled people in order to be able to operate these environments. Low cost people aren’t brought into the region because certain operations run remotely.”

HP is investing in offshore centers to run remote operations cost effectively. They already have a large operation in Egypt and some resources in Tunisia and Morocco, as well as a significant resource base in Saudi Arabia. Bouzid stressed that the way HP is approaching outsourcing should create space for local engineers who are returning to the region after education abroad.

“Ours is a really different approach to enterprise services,” said Bouzid. “The new Saudi graduates are very skilled. Many are returning from having their education in Western Europe or North America. They are keen to get back into their home country and show what they can do. The Indians, the Egyptians and other workforce that have been employed in the region have really been on the low cost end. They haven’t been on the transformation end, and that’s our focus.”

Egypt could become the top outsourcing destination worldwide, says expert

Egypt could become the top outsourcing destination worldwide, says expert

By Christopher Le Coq /Daily News Egypt

CAIRO: Worldwide demand for outsourcing is tilting towards Egypt as Europe now spends more on outsourcing than North America. According to Denise D’Elia, a Vodafone representative, outsourcing as an industry was valued at $13 billion last year.

Egypt has the third-largest talent pool in the EMEA region. This is largely due to the country's rich pool of young talent — 50 percent of the population is under 25.

Although this is a positive development, for Egypt to play a major outsourcing role worldwide, it needs to build its capacity in several areas, D’Elia said.

Moreover, a provider must ensure that it is a reliable supplier and provides certification. Reducing “churn” — an industry term for lowering the rate of customer loss — is also critical.

D’Elia also highlighted the importance of education, which in Egypt is an area with promise. Indeed, the representative indicated that Egypt pumps out 330,000 university graduates per year — the third largest in the region — which will provide a steady flow of job seekers to the sector.

She noted that firms such as Vodafone, which have substantial outsourcing operations in the country, seek young graduates with specializations in engineering, commerce, and industry.

As it so happens, Egypt currently has a significant number of students whose studies focus on these three areas.

Furthermore, as an outsourcing center for Europe, D’Elia emphasized the importance for Egypt to maintain the population’s strong European language skills.

She said that it is the only country in the world that boasts an aptitude in various European languages — including some less widely-known languages, such as Polish — which thereby give Egypt a competitive edge.
A key area that must remain a focus is controlling cost, she said. According to D’Elia, firms are looking for increased revenue per customer, and this is an area where off-shoring can play a role.

However, in terms of cost, Egypt performs well in relation to other outsourcing destinations; Egypt even performs well in comparison to India and the Philippines, which are currently the two top choices for outsourcing worldwide.

D’Elia stated that cost in Egypt is competitive from both a personnel and non-personnel perspective (which includes infrastructure), according to data gathered by ITIDA and various consultancy firms.
She highlighted the efforts taken by the government to drive the sector, noting reforms in the areas of taxation and customs simplification. In addition, the financial sector has gradually become more privatized, and legislative and institutional frameworks fostered through “one-stop shops” have been established. Many of these legislative and institutional frameworks have even been implemented within 72 hours, which is quite faster than in previous years.

In terms of infrastructure, strides have also been made.

Smart Village was initially established to serve as a concentration of businesses specializing in information technology, yet due to its strong success it quickly became a headquarters for a variety of multi-national corporations.

Following its example, the new IT Maadi Park will be ready for operation in 2012. It is slated to house approximately 300,000 employees in over 40 buildings.

Last year, Egypt was ranked 13th in the field of global service delivery, according to an AT Kearny survey. Thanks to governmental efforts and the positive market dynamics already inherent to Egypt, the country was ranked sixth this year.

“Many countries would like to be in that position,” D’Elia said.