Offshoring a growing option

European companies are increasingly keen on offshoring business processes to cut costs, and British companies are even keener.

Almost half of the top 500 European companies plan to move more jobs offshore in the next few years. But Britain and Europe are also a destination for European companies looking to relocate certain services.

Thomas Eichelmann, senior partner at Roland Berger, which carried out the survey, said: "Companies in Europe seem to fall into two categories: a significant portion have already offshored in the past and is planning on further activities, whereas others have no experience in offshoring and are not considering it for the near future."

British companies were the source of 61 per cent of the jobs sent overseas. India gets 37 per cent of those jobs, western Europe gets 29 per cent and eastern Europe 22 per cent.

The UK, Ireland, Spain and Portugal were top destinations for western Europe. More than half of projects take place within Europe but those moving to India tend to be bigger projects with a higher headcount.

Cost savings are the main driver for offshoring and projects typically reduce costs by 20 to 40 per cent. 80 per cent of companies questioned said their projects had been successful.

About 60 per cent of projects involve back office functions like accounts, human resources or IT support. But about a third of projects, or planned projects, involve customer call centres or other customer-facing function.

The survey was carried out on behalf of the United Nations Conference on Trade and Development by Roland Berger Strategy Consultants. ®

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