Vietnam is fast becoming a center for software development companies to set-up their offshore operations. Despite of the huge market share of India, Vietnam is quickly emerging as a software outsourcing destination. Recent reports (A.T. Kearney and KPMG) have named Vietnam’s Ho Chi Minh City among the top 5 outsourcing cities in the world.
Rasmus Andersen, An Mai and Martin Dommerby
I had the opportunity to speak to An Mai, President of IMT Solutions. IMT is a software development company based in Ho Chi Minh City, Vietnam. With an MBA from Asian Institute of Technology , coupled with 15 years of industry and software development experience, he offers unique insight into Vietnam’s economic growth and change.
MD: Vietnam is playing a growing role in outsourcing and has been named “the new India”. Can you describe the outsourcing market in Vietnam?
AM: Sure, we see that the cost benefits, lower attrition and government support is positioning Vietnam as an alternative to India. IT salaries in Vietnam are the lowest among offshore destinations and 40% lower than in India and China. We have a young and highly motivated workforce, and low staff turnover rates of about 5%. Vietnam is a natural offshore location and has all the ingredients to become the leading market choice in the next few years.
MD: How is the government supporting the outsourcing industry?
AM: The Government of Vietnam is promoting its economy for more foreign investment. It offers tax benefit for companies setting up software development operations. Also the government has created special enterprise zones and software parks. In recent year there have been made huge investments in infrastructure and telecom which supports the software outsourcing business.
The nation plan for human resource development means that the number of technical graduates increases. Each year more than 25,000 technical engineers graduate from the universities.
MD: Please describe the software workforce, what can we expect?
AM: Vietnam has a young generation of skilled workers that are highly dedicated and technologically skilled. This dynamic generation provides a great pool of skilled software developers required to meet the growing demand of offshore development.
The English level is rapidly improving and unlike many Asian languages, Vietnamese uses the Latin alphabet, which makes it relatively easy for Vietnamese speakers to learn English.
MD: Why is Vietnam attractive for European software development companies?
AN: I would mention 3 important factors for why Vietnam is interesting:
1. Cost: The rates are very competitive
2. You will get access to a large pool of talent
3. Vietnam has a good business environment and offers a stable political system
MD: What advise can you give for companies that want to do business with Vietnamese companies?
AN: There is a cultural gap between Vietnam and Europe. Even though our people generally have an open mindset towards foreigners I would suggest you to find a good local partner. The partner will help you understand the cultural gaps and local business requirements – and not least help you grow the business!