MexicoIT’s Success Story•MexicoIT / CANIETI•Partnership between Federal Government and the private sector•Mission: To increase awareness and value of Mexico as a leading global sourcing destination 2
Action Elements Investment Positioning Exports States Government/Industry Companies Potential Analyst Potential Clients Firms Clients
Offer Pitch Elements Media Strategic Marketing Information International promotion of Mexico Training Support Focus on objective Audience
Background2002 Mexican scenario - Exports for less than 200M USD annually in ITServices - IT Domestic Market – Negative growth rate - Low Human Capital volume availability - Less than 25 IT companies with some kind of qualityor process certification, such as CMM, CMMI and/orMoProSoft
Recent history2012 Mexican scenario - Exports for almost 5 Billion USD annually in ITServices; Proven leader in LATAM - IT Domestic Market – Double digit growth rate forthe last 5 years - Human Capital availability +90,000 Engineersannualy - IT companies that have achieved a quality orprocess certification, such as CMM, CMMI and/orMoProSoft (More than 400)
HighlightsIn an absolute comparison ofman/hr rates, Mexico may bemore expensive than othersourcing destinations, but totalcost of engagement (TCE)tends to be lower.
Achievements1.According to Gartner, Mexico ranked as the 4th global IT Services provider2.Among Top 5 global IT Services Providers in Forrester’s list3.Ranked 6th in 2011 Global Services Location Index of A.T. Kearney4.Most competitive option - Localization of several IT Services, according to KPMG
Alternative locations are required for a number ofreasons Time• The importance of concurrent work • Cost savings compared to USA Lower Costs Zone• Seamless interactions • Lower tariffs, infrastructure and tax costs Lower TCE (Total Cost of Engagement) • Practical resolution of tasks • Higher offshore leverage(85%-95%) • Lower overhead than offshoreProximity• The importance of being close • Lower indirect costs than India • Easier relationship management • Project tracking with no surprises Diversification • Support diversification strategies NAFTA •Simplified immigration regulations • The Americas hub for offshore •More visa types: E, TN, L, H1 • Key component in the global strategy of •Mitigated impact of new regulations global organization •Sound infrastructure •Strong Intellectual Property protection Foreign and • Macroeconomic discipline / stability Economic • Designed for globalization (# of free Policy trade agreements) Cultural •Similar business culture Affinity •Cultural affinity eases team integration in • Compatible exchange rates • Grants and incentives: MexicoIT, Prosoft, the day-to-day MexicoFirst and other programsHispanic •Supporting the Hispanic market Talent Market •Bilingual services: English and Spanish Pool • 90,000 graduates per year •For supporting the US Hispanic market • Attrition rates Reasons NOT to overlook Mexico Plus, most companies that try nearshore, never leave
MexicoIT Events for Global Promotion• Potential Clients Recognition Gartner, Forrester, Global Services & WITSA events have permitted the private and public sectors -via MexicoIT-, to present their offers to thousands of decision makers interested in outsourcing their IT services.
MexicoIT Events for GlobalPromotion• Potential Investors Recognition – Participating at events have permitted to raise the awareness of the benefits of investing in our country. • MexicoIT has received several questions, acknowledgements, and business proposals.• Raising the awareness of the country brand – Through the membership of strong and solid companies and the support of the federal and several state governments. i.e. Neoris, Softtek, Quarksoft, Dextra, Praxis, Vangtel and States like Sonora, Sinaloa, Mé xico, Jalisco, Queré taro y Nuevo Leó n.
What’s next forMexicoIT ?- Continue to work with the Government- Go for # 3 as a global IT Services Provider- Diversification strategy vs. India y/o China- Take advantage of a growing US Hispanic market- Mexican domestic Market- Focus on verticals