Nordic fin firms look to move tech jobs to India
BANGALORE: Nordea, a leading financial services group in the Nordic and Baltic region, along with peers Svenska Handelsbanken and SEB, are among a new set of customers planning to offshore technology work to India. These players aim to bring down operational costs by up to 30% and cope with the slump more effectively.
Indian tech vendors like TCS, HCL, L&T Infotech, Wipro, Infosys and Cognizant are in discussion with Nordic customers for outsourcing contracts potentially worth around $100 million each over the next few years.
Outsourcing advisory firm EquaTerra recently analysed around 370 outsourcing contracts signed by over 200 Nordic customers, and concluded that Indian service providers scored better than European vendors such as TietoEnator and Capgemini, when it came to customer satisfaction. EquaTerra analysed almost $4.3 billion worth of outsourcing contracts signed by these customers.
“Many Nordic firms are looking at some of the successful offshoring case studies in their region such as Ericsson and Ikea, and are now beginning to explore similar opportunities,” said Sridhar Vedala, managing director of offshoring advisory firm Quantam Step.
Most Nordic countries, especially Sweden, have high cost structures. This is putting pressure on local customers to seek low-cost resources in locations like India, which will help them tighten belts by up to 30-40%. For instance, when Handelsbanken was seeking suppliers for a new outsourcing contract, it shortlisted six vendors, including Logica, TietoEnator, TCS, L&T Infotech, HCL Technologies and Hexaware. However, despite the presence of European outsourcers, the firm finally decided to go ahead with pure offshore vendors such as HCL and L&T Infotech.
“India remains the dominant offshore destination for Nordic firms. 61% of the respondents are using India to fulfil at least some of their global sourcing needs,” EquaTerra said in a recent report. When contacted by ET, Indian tech vendors declined to comment on any potential outsourcing contract being pursued by them.
