satyamopens.jpgSatyam Computer Services, a leading Indian software outsourcing firm, has opened a nearshoring centre in Guangzhou to serve customers in Japan and HK.

The new 100-seat centre in Guangzhou Software Park, strengthens
Satyam's presence in China, which already includes operations in
Shanghai, Beijing and Dalian. The new Guangzhou facility will be able
to accomodate up to 1,000 employees by 2008.

Satyam claims it was one of the first foreign outsourcing companies
to enter the Chinese market and it set up its first development centre
in Shanghai in 2002 with just 10 people. Today, it employs around 400
people in China, 97% of which are Chinese workers.

While the Indian company believes that local Chinese businesses will
also one day turn to outsourcing, its main focus today is on using
China as a nearshoring centre to to serve the better developed software
markets of HK and, most importantly, Japan. Its expansion plan in China
calls for two more more nearshore centres in Dalian and Beijing, and a
total workforce of around 3,000 people.

Like other Indian outsourcers, Satyam is looking to “de-risk” its
traditional outsourcing model. . By setting up nearshoring centres in
countries are physically closer to their customers in the west and
Japan, Indian firms hope to reduce their traditional heavy dependence
on India, where labour costs are rising and skilled worker are
increasingly hard to retain.

Nearshoring also reduces the project management issues that can
arise if the only point of contact for a customer is many time-zones
away in India.

More on China's attractions for Indian outsourcing firms in this EngagingChina story.

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