Source: Media Outreach
- Eight Asia Pacific countries place in the top 15 as the most attractive destinations for offshore services globally.
- 2023 Index focuses on talent regeneration and digital skills, bringing Singapore into the limelight as APAC’s emerging technology destination for establishing innovation hubs.
< >SINGAPORE – Media OutReach – 8 August 2023 – Global management consultancy Kearney has published its 2023 Global Services Location Index (GSLI) that studies the critical factors that make countries attractive as potential locations for offshore services.
In an era of rapidly evolving global business landscapes, business services like information technology, business process outsourcing (BPO), and engineering are increasingly being delivered across borders as companies seek to reduce costs, scale talent, and increase efficiency by utilizing the global talent base. In the current climate, Asia Pacific (APAC) markets shine as potential offshore service destinations, with India, China and Malaysia continuing to lead the index as the top three destinations respectively.
The GSLI ranks 78 countries based on 52 metrics that cover four dimensions including financial attractiveness, people skill and availability, business environment, and digital resonance.
Strong outlook for APAC
Continuing their strong showing in GSLI 2021, APAC countries lead this year’s Index, with India, China and Malaysia in the top three largely due to cost advantage, talent availability, and strong skills. Meanwhile, Indonesia, Vietnam, Thailand, the Philippines, and Singapore are ranked among the top 15. Singapore jumps 24 ranks from 38th to 14th in this year’s rank, the highest leap by any country.
A breakdown of the performance of APAC countries within the GSLI, namely India, China, Malaysia, Indonesia, Vietnam, Thailand, the Philippines, and Singapore can be found in the appendix.
< >“Geopolitical, economic, and technological forces have spurred significant changes in the global labor market. Therefore, a country’s ability to reskill and redeploy its workforce in response to changing market demands and technological disruptions is key to improving its attractiveness as an offshore location for business services,” says Arjun Sethi, Kearney’s Global Vice Chair of Digital Transformation, Regional Head and Chairman of Kearney’s APAC Region, and co-author of the 2023 GSLI report. “Talent regeneration will be the most crucial gamechanger as Industry 4.0 continues to reshape the demand for future skills and jobs. And this is what has kept the top three countries – India, China and Malaysia – solid in the Index for a few years now, while the rest have been fairly fluid in their positions.” Adding on he said, “So in a nutshell, while building regenerative talent pools, everything, everywhere, all at once, is what a country should seek to achieve – to consistently stay ahead of the curve.”
Talent regeneration key for continued attraction
A key trend emphasized in this year’s report is the importance of talent regeneration – a country’s ability to rapidly reskill and redeploy its workforce in response to changing market demands and technological disruptions to maintain and enhance its attractiveness as an offshore location.
With the emergence and adoption of digital technologies, cost-centric service locations are at risk of losing their competitiveness to more developed and technologically advanced countries as more work and processes will be automated. Talent regeneration, therefore, will serve as the backbone of this shift.
Through a talent regeneration matrix, this year’s report shows the talent regeneration capacity and maturity of countries. Singapore shines as APAC and Southeast Asia’s premier emerging technology destination and innovation hub. India and China also exhibit strong talent regeneration and are projected to lead the world in terms of the availability of a tech-enabled workforce. Additionally, traditional offshoring leaders in the region such as India, China, Malaysia, Indonesia, Vietnam and Thailand will need to invest heavily in talent regeneration as the labor cost advantage becomes less relevant given the technological disruptions and socioeconomic factors.
About the 2023 Kearney Global Service Locations Index
The 78 countries in the 2023 Global Services Location Index were selected based on corporate input, current remote services activity, and government initiatives to promote the sector. They were evaluated against 52 metrics across four major categories: financial attractiveness, people skills and availability, business environment, and digital resonance. This year, Kearney refocused the Index to be more forward-looking and captured digital resonance and talent regenerative capabilities and availability. In the process, a few metrics were dropped from the people skills availability and digital resonance pillars that were focusing on traditional IT, and new digitally focused parameters were added. This along with global trends and key local disruptors led to marked differences in some countries’ rankings.
To access the report, click here< >
Hashtag: #Kearney #GlobalServicesLocationIndex
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