Vietnam outsourcing companies re-positioning as BPM service providers

Vietnam which has firmed its position in the global outsourcing market as an important hub for software development and IT outsourcing is now moving up the value chain to position themselves as business partners who will manage the business processes of their clients.

The outsourcing companies in Vietnam which are well known for IT services have now started offering other high end business process management services like R&D services, integrated customer support services, high end IT function management services, knowledge processing management services and even complicated production process management for OEMs and electronics manufacturers. The new outlook of process managers and a favorable geographical location of the country are resulting in a huge opportunity for the new sector to move to new heights.

BPM in Vietnam. Image source

The new generation BPM service providers in the country have succeeded in attracting new investments to the business process management sector.  As per the reports from Foreign Investment Department under the Ministry of Planning and Investment (MoPI), the new outlook developed by the service providers as business process managers or business partners for the clients have attracted a total of 672 new deals worth US $5.52 billion in the outsourcing sector of the country. The figure released, is up by 56.5% when compared to last year deal values.

According to industry experts, there are few prominent factors that prompt global companies to seek the services of the BPM providers in the country to manage their business process; such as:

  • Quality of the services delivered.
  • Capability of the service providers to act as the business partners rather than a mere third party service provider by managing the clients’ core business process, and
  • Socio-economic stability, political stability and a favorable business environment.

It is forecasted that the new focus of the industry on business process management will earn them deals from global companies to manage their software development process, high tech IT functions and to carry out R&D activities in the IT sector. It is said that majority of global manufacturing companies that has deployed services of providers from China and Thailand will turn to the new generation business process management service providers in Vietnam to manage their core production process as a result of increasing cost in China and recent political instability in Thailand.

The initiatives adopted by the government like exemption of tax for outsourcing companies in the country can be considered as a key reason for the transformation of BPO companies to BPM companies. Initiatives like tax incentives and subsidies for the BPO companies have given them the opportunity to invest further to develop in-depth capabilities which have helped them to position as business partners for their clients.

It is expected that the re-positioning of the industry as BPM service providers is likely to play a key role, in fact a bigger role in the economy of the Vietnam in future years to come.

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