Watch the recording of this session and learn why nearshore outsourcing is the next big thing and why a lot of companies are looking into Costa Rica in particular.

1. 1
Eric Liebross
Senior Managing Director,
Business Transformation
Janelle Souza
Controller
November 11, 2020
10:00 - 10:50am ET
The Rise of Nearshore Outsourcing in a Post-COVID Era
Why CFO’s Are More Open to Nearshoring in 2021
Enrique Martinez
Managing Director,
Finance Transformation

2. Sources:
- PwC CFO Pulse Survey
- Gartner
- U.S. Bureau of Economic Analysis
The Need to Optimize Costs & Increase Operational
Resiliency Became even More Relevant after COVID
80% of CFOs are
implementing cost
containment initiatives in
response to COVID
Cash and liquidity is the
current top concern for
71% of CFOs
74% of organizations
plan to make remote
work a permanent part of
their model
The U.S. economy suffered its
worst period ever in Q2 2020,
with GDP falling 9%
(projected to -33% annually)

3. 3The Adoption of Outsourcing and Automation is
accelerating in response to these needs…
Sources:
- SSON HR Shared Services Poll Survey
- Forrester: The Future of Work – A Pandemic Spotlight
61% of Shared
Services plan to
outsource more in
response to the new
future of work model,
while 84.6% plan to
increase automation
Nearly 50% of the organizations will increase
RPA spent over the next year due to COVID-19.
The main goals for the RPA investment are:
83% - Increase agility, diversity, & resilience in their
supply chain operations
80% - Address extraordinary cost pressures by
automating back-office and operational tasks
75% - Support remote workforces

4. 5
The question is…How to make
outsourcing right?

5. 6
Leading Regions for Shared Services & Outsourcing
Location Strategy
Latin America
Eastern Europe
North America
South and East Asia
 Lowest cost in the globe
 Most common global
destination for low-value,
transactional processes
 Significant time-zone and
cultural differences with the
Americas
 Pan-Regional solution for
Americas
 30% to 60% labor arbitrage
compared to US
 Used for both low and high
value activities
 Regional solution for US
and Canada
 High cost – not convenient
for a global solution
 Nearshore solution for Europe• Geographic Proximity
• Time Zone
• Low Cost
• Large and Strong Workforce
• Cultural Affinity
• Language Skills
• Lower Turnover than Asia
• Infrastructure
Primary Drivers
Latin America represents 28% of
the “Top 25” Global Outsourcing
Destinations (Tholons 2018)

6. 7Demand for Greater Collaboration and Value Add Services
has driven the rise in Nearshoring
• Cost savings is a given but is not the sole
driver
• Outsourcer brings best-in-class
technologies and best practices to drive
innovation and high performance
• Nearshore enables a collaborative
approach where outsourcer serves as an
extension of your team
• Close to home with similar work schedules
and cultural affinity
VS
• Driven by labor arbitrage
• “Black Box”- lack of control and
visibility over the operation
• Quality concerns - Hard to
collaborate and drive innovation and
continuous improvement
• Significant time zone &
geographical differences with
language and cultural barriers (Asia-
based)
Traditional Outsourcing Outsourcing that works!

7. 8
The True Nearshore Destinations in the Americas
Costa Rica, Colombia & Mexico
• #1 LatAm Destination
• Maturity of the Services Sector &
experience supporting the US
• Multi-lingual skills
• Gov’t Support/Ease of Doing
Business
• Higher cost than Mexico
and Colombia
• High Concentration of
Captive Shared Services
• Smaller Labor Market
• 2nd Largest Labor Pool in
LatAm
• Low Costs
• Multinational Experience
• Political stability
• Ease of doing business
• Gov’t support
• Labor Force Quality
Challenges
• Low Costs
• Labor Force Quality
• Gov’t Support
• Emerging/growing
destination
• Multi-lingual capabilities
• Labor Flexibility
• More limited SSC experience
supporting the US
Highlights
Costa Rica ColombiaMexico

8. 9Polling Question 2
Do you agree with the advantages of nearshoring vs. offshoring?
Agree
Neutral
Strongly Agree
Disagree
46%
38%
17%
0%
Strongly Disagree 0%

9. 10
So…Why
Costa Rica?

10. 11
• #1 English proficiency in Latin America
• #1 Education System in Latin America with the highest literacy rate (98%)
• Strong services sector with consistent growth year over year
• Central Time Zone with quick direct flights to most major U.S. Cities
• Strong Cultural Affinity to the US
• #1 Country in Innovation in LatAm by Global Innovation Index (2017)
• No Army! It was abolished in 1948
• Safest City in Latin America - recognized worldwide for its politically stability and peace.
• Solid Infrastructure & Utilities with 100% power and Telecom redundancy
Costa Rica has been consistently
ranked as the #1 nearshore
destination in Latin America

11. 2000 2018
1,061
65,904
2000 2018
6
172
62x 28x
Compared to 2000, employment is 62x and the number of
multinational companies is 28x
Costa Rica is the #1 Exporter of
high value added services in Latin America
Source: CINDE, 2019

12. 1.4%
7.3%
8.6%
4.8%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Exports of selected industries as a % of GDP
Telecommunications, computer, and information services; and other business services Agriculture
Telecommunications, IT services, and other business services exports represent over 7% of the GDP
From Agriculture to an Industry &
Services Based Economy
Source: CINDE based on data from BCCR and PROCOMER, 2019

13. Over 170 World-Renowned Multinationals
have established Services Operations in the country

14. Contact Centers Shared Services Other Digital Services
Finance &
Accounting
P2P, O2C, R2R
• Accounts
Payable
• Billing & Billing
Adjustments
• Accounts
Receivable,
Invoicing &
Collections
• Cash Application
• Credit Verification
• Fraud Control
• Auditing
• Reconciliation
• Cost Accounting
• Financial Reports
• Financial Planning
& Analysis
• Fixed Assets
• General Ledger
• Revenue Cycle
• Tax Filing &
Analysis
• Treasury
• Controlling
• Transfer Pricing
Supply Chain/
Procurement
• Procurement-
to-Pay
• Bidding
• Strategic
Sourcing &
Purchasing
• Transportation
planning and
execution
• Suppliers &
Vendor
management
• Inventory
allocation and
management
• Planning
• Forecasting/
Seasonality
• Customer
order tracking
(credit hold,
order
processing and
management
claims)
Human
Resources
• Payroll
• Regional
Recruitment
• Screening &
Staffing
services
• Talent
Management
• HR Planning &
Reporting
• Employee
Administration
• Expat
Relocations &
Training
• Travel &
Expenses
• Benefits &
compensation
• Hire to retire
Other
• Business
Knowledge
Analysis
• Business
Intelligence
• Organization
Analytics
• Data Entry &
Processing
• Master Data
Management
• Research & Data
Analysis
• R&D
• Business
Presentation
Design
• Portfolio Analysis,
Investment
Research
• Project, Process,
Contract & Product
Management
• Change
Management
• Risk Management
• Clinical data
reporting
• Contract reviewing
• Sales & Marketing
Digital Marketing
• Digital production:
multimedia, art
direction, graphic
design, storyboard
illustration, web
microsites, and
banner design
• Content & SEO
• Paid Ads
• Email Marketing
• Social Media
management
• Video production
• Gaming
• E-commerce
• Web Design,
Development &
Production
• User interface
design: UX / UI
• Mobile app
development (iOS
and Android)
• Consumer behavior
IT
• IT Global
Helpdesk
• IT Infrastructure
Operations –
Data Center &
Network Ops
• Cloud
Transformation
• Database
administration
• Cybersecurity
• Software
Development &
Maintenance
• DevOps
• Quality Assurance
& Testing
• Reporting &
Analytics
• Advanced
Analytics
• Big Data
• Robotic Process
Automation
• Customer
Service/Care (via
phone, e-mail &
chat)
• Technical Support
(Tier 1-4)
• Collections/legal
collections
• Simultaneous
Interpretation
• Video remote
interpreting
• Sales/B2B sales
• Billing
• Insurance validation
• Supply chain
support
• Seller/Vendor
support
• Marketing support
• Cloud support
Engineering &
Design
• Application
Engineering
• Orthopedic
Reconstruction &
Design
• Orthodontic 3D
Design
• Hardware design,
development,
testing &
validation
• Architecture
drawing & design
• CAD - CAM
Technology
support
• R&D+i
Service Companies have Become
Multi-Functional Centers

15. 16
What savings can
you expect from
nearshoring to
Costa Rica?

16. 17
It’s not just about labor arbitrage
Savings Opportunity Roadmap
One to one comparison of the
total labor cost of a resource in
US vs. a Nearshore Location
Most times the org structure can
be releveled to achieve better
span of control
Efficiencies gained from
centralization, process
improvement and automation (e.g.
RPA, Operational Analytics, etc.)
30%-50% 10%-20%
ONE TO ONE LABOR
SAVINGS
ORGANIZATIONAL
RESTRUCTURING
PRODUCTIVITY
EFFICIENCIES
10%-20%

17. 18
Savings as high as 50%+ for transactional roles across AP, AR and R2R
Auxis 2019 Labor Savings Report for Finance & Accounting

18. 19
Savings as high as 50%+ for transactional roles across AP, AR and R2R
Auxis 2019 Labor Savings Report for Finance & Accounting
Link to download full report
for both F&A and IT positions:
www.auxis.com/2019-US-finance-labor-report-
outsourcing-costa-rica

19. 20Polling Question 3
What would be your main driver for considering outsourcing?
Increasing operational flexibility, agility & business continuity
Reduce costs
Accelerate digital transformation & performance improvement
36%
21%
18%
18%
7%
Increase my team’s focus on higher value activities
Access to talent

20. 21
Panel Discussion

21. 22
A Nearshore Example:
Pandora Jewelers

22. 23
Comparing and Contrasting
Nearshore vs. Offshore

23. 24
What to look for in your
outsourcing provider

24. 25
Automation & Continuous Improvement:
The Role of Your Outsourcer

25. 26Polling Question 4
Given what you have learned today, what do you now believe to be the
most positive aspect of nearshoring?
Communications in real time, all the time / easy for short visits
Lower cost
Agility & quality of the talent
35%
26%
22%
13%
4%
Cultural similarities
Separation of work for business continuity/disaster recovery

26. 27
Lessons Learned

27. 29
Q&A

28. 30
Thank you for
joining us today!
Eric Liebross
Sr. Managing Director, Auxis
Eric.Liebross@auxis.com
Janelle Souza
Controller, Pandora Jewelers
JSouza@Pandora.net
Enrique Martinez
Managing Director, Auxis
Enrique.martinez@auxis.com