LONGMONT — Longmont is listed among a number of midsize U.S. cities that make attractive alternatives to offshore locations in India and elsewhere for information technology and business process services, according to research released Friday.
The study was done by The Hackett Group (NASDAQ: HCKT), a Miami-based intellectual-property-based strategic consultancy and best-practices implementation firm.
Longmont made the study’s Top 10 list, along with Syracuse, N.Y.; Jacksonville and Tampa, Fla.; Lansing and Grand Rapids, Mich.; Allentown, Pa.; Green Bay, Wis.; Richmond, Va.; and Atlanta.
The Hackett Group used the same 39 key indicators it relies on to evaluate offshore business services locations in more than 40 countries to evaluate the domestic options. The scores for each city were weighted based on the primary factors that buyers of IT and business process outsourcing typically consider: economic considerations such as labor and office-space costs (60 percent), workforce quality (20 percent), infrastructure availability and quality (10 percent), overall risk (5 percent), and business environment quality (5 percent).
“Wage increases in certain offshore countries has shrunk the cost gaps with many U.S. cities,” said Mark Peacock, principal and IT transformation-practice leader at The Hackett Group.
In addition, according to the study, IT and business leaders seeking proximity to headquarters or customers, specific industry or company knowledge, strong local language skills and cultural affinity are increasingly considering lower-cost domestic sources of IT services in lieu of sending the work abroad.
“Customer-facing activities are most typically brought onshore, (such as) service-desk and end-user support, business analysis, agile development groups, user acceptance testing, infrastructure engineering and operations work,” said Peacock, who noted that application support still tends to be offshored.
The United States ranks 25th among 42 countries in attractiveness for global business services delivery, according to The Hackett Group.
Each city has its specific strengths, typically around industry or functional capabilities, said Jim O’Connor, principal with The Hackett Group.