2. 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
3. Action Elements
Investment Positioning Exports
States Government/Industry Companies
Potential Analyst Potential
Clients Firms Clients
4. Offer Pitch Elements
Media
Strategic
Marketing Information
International
promotion of
Mexico
Training Support
Focus on
objective
Audience
6. Background
2002 Mexican scenario
- Exports for less than 200M USD annually in IT
Services
- IT Domestic Market – Negative growth rate
- Low Human Capital volume availability
- Less than 25 IT companies with some kind of quality
or process certification, such as CMM, CMMI and/or
MoProSoft
8. Recent history
2012 Mexican scenario
- Exports for almost 5 Billion USD annually in IT
Services; Proven leader in LATAM
- IT Domestic Market – Double digit growth rate for
the last 5 years
- Human Capital availability +90,000 Engineers
annualy
- IT companies that have achieved a quality or
process certification, such as CMM, CMMI and/or
MoProSoft (More than 400)
9. Highlights
In an absolute comparison of
man/hr rates, Mexico may be
more expensive than other
sourcing destinations, but total
cost of engagement (TCE)
tends to be lower.
10. Achievements
1.According to Gartner, Mexico ranked as the 4th
global IT Services provider
2.Among Top 5 global IT Services Providers in
Forrester’s list
3.Ranked 6th in 2011 Global Services Location Index
of A.T. Kearney
4.Most competitive option - Localization of several IT
Services, according to KPMG
11. Alternative locations are required for a number of
reasons
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 offshore
Proximity• 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 programs
Hispanic •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
12. 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.
13. MexicoIT Events for Global
Promotion
• 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.
14. What’s next for
MexicoIT ?
- 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
MexicoIT is a private and public sector partnership created in order to raise the awareness of the country brand as a leading global sourcing destination. MexicoIT is owned and managed by the Mexican Chamber of Electronics, Telecomm and IT Industries. –CANIETI-. MexicoIT is funded by the Government and it’s public policy, called PROSOFT.
MexicoIT has three sets of action elements that constitutes its backbone. The main one is to position the country brand, that’s why this one is at the center. The other two are the investments and the exports. This is why we work with the analyst firms, the media and the potential clients.
The support of the MexicoIT program is backed up by 6 main elements: marketing, events, training, government support, strategic info access and media. This is what the MexicoIT campaign centers at.
The two thousand two Mexican Scenario looked like this: Exports for less than two hundred million dollars per year. A negative growing IT domestic market. Low human capital availability. And a very low number of companies with some kind of quality or process certification.
And now, this is the Mexican Scenario: The exports have multiplied by twenty five and now they’re around the 5 billion figure. An IT domestic market growing at a double digit rate for the las five years. More than ninety thousand IT related professionals coming out of school annually,. This figure is higher than Brazil and the US for example. According to the leading analyst firm Gartner, Mexico has the highest proportion of companies that have some kind of quality or process certification such as CMM, CMMI and/or MoProSoft.
If you compare hourly rates, Mexico is more expensive than countries like India or China. But when you add up all the different related costs, and measure the Total Cost of Engagement, Mexico has very competitive costs and several advantages.
The leading analyst firms already see Mexico as a key global player……Gartner, Forrester, AT Kearney, KPMG…..
I’m not going to talk about all the different benefits and advantages of doing business with Mexico, but here are a few good examples: time zone, proximity, NAFTA, cultural affinity, hispanic market, low – competitive costs, diversification, strong and agressive public policy, talent pool, IP protection, etc….
The main idea of participating at global events like this is to definitely continue to raise the awareness of Mexico as a leading IT services provider. And this is not something that happens overnight, this is something that you have to continue doing for a long time and foster a trust worthy relationship with all the main actors.
The support of the Government and the main Mexican companies has been crucial for the success of MexicoIT. Because we all understand that is not only the set of messages that I’m saying here. It’s the support of a strong and ever groing Industry that makes the difference and positions a country as a leader.
