Nearshoring increasingly valuable for U.S. firms, confirms Nexus 2015

If you saw the recent announcement about our invitation to participate in Nexus 2015, the nearshore industry conference offered by Nearshore Americas, you may wonder how the event turned out. At Nexus 2015, I connected with many interesting people and organizations to get a wide perspective on today’s nearshore industry. Participating in the Mexico Leadership Panel, facilitated by MexicoIT, gave me an opportunity to exchange experiences with other panel members and the audience. My takeaway: For North American companies, Mexico is the most rewarding nearshore outsourcing location. The IT industry and nearshoring advance positive social change, and I am delighted that Tiempo contributes to it.

This was the fifth Nexus event held by Nearshore Americas, a strong voice on behalf of the nearshore business model. Tiempo Development participated in a Nearshore Americas conference in Mexico close to the end of 2014, and I was able to continue some conversations that began then. Participants in Nexus 2015 came from many different companies that span across countries’ borders in North and Latin America. Most of them were organizations that take advantage of nearshoring, contract to have manufacturing or assembly performed, or outsource some of their business activities.

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Expanding Latin America’s middle class

It was remarkable to hear how strong the momentum is for business and investment in most of Latin America, how much the governments do to help IT and other industries grow, and how effectively the region’s universities are graduating people with valuable degrees. As a result, in many countries a vibrant middle class is growing as more and more professionals find worthwhile employment at home and a trend of many years of talent drain to North America and Europe is slowly being reversed. At Tiempo, we do our part to bring this about by creating software engineering and other technology jobs that pay far above average and drive economic benefits into regional economies. In Hermosillo, we are the largest nearshore development provider and well known as a good place to work. In Guadalajara and Monterrey Tiempo is growing quickly. In all three locations, we are deeply involved in the development and civic communities. We are following our vision of making lives better, and it’s great to know that we are not alone—there are other companies achieving similar results, even if they don’t describe them in the same words.

There is a high urgency to this aspect of nearshoring, because individual and development needs in the Latin American countries are still immense. Keynote speaker Francisco Palmieri, Deputy Assistant Secretary for Central America and the Caribbean, at the U.S. Department of State, reminded us of the resulting immigration pressures, which brought close to 65,000 children to the U.S. border in 2014 alone. As Palmieri explained, the Obama administration engages in a number of initiatives to assist people in their home countries and is expanding the trade and business opportunities within NAFTA. Together, Mexico and other Latin American countries are the strongest trading partners for the U.S., and Mexico by itself is the third-largest behind Canada and China.

Mexican leadership for the hemisphere

For most of the business leaders and nearshore industry experts I heard from, Mexicois the clear leader in these developments. Companies shared success stories from their outsourcing experience that would have been almost unthinkable just a few years ago. Mexican software developers, for example, have long passed out of earlier stages of gaining experience, absorbing methodologies and best practices, writing functional software tools, and establishing a high-caliber talent pool. Today, they are using their expertise to help companies in North America resolve their most complex technical and business challenges. Executives see that they are no longer compelled to engage with high-end resources in India or the U.S. in order to accomplish that.

The quality of talent available in Mexico equals the best of what you find in the developed countries and offshore outsourcing locations, and more outstanding people graduate with technical degrees or make early career decisions favorable to IT all the time. MexicoFirst, a government initiative whose mission is advancing the quality and quantity of human capital in the country, is making a huge contribution to remedying the global shortage of engineering talent by moving more than 80,000 people through globally recognized IT and professional certifications.

Transcending competition

What I particularly enjoyed at Nexus 2015 was the collaborative spirit of many participants. Some of the best conversations were with my peers at companies that compete with Tiempo Development. With one of them, we agreed that our strengths and weaknesses in creating mobile apps and enterprise solutions are complementary. It wastes ours and our customers’ time and resources if we continue to compete for the same business and poach talent from each other. Instead, we began planning a more synergistic approach that can deliver each company’s best development work in their respective disciplines to customers, and where we attract and nurture talent along the same lines.

In talking with another outsource company’s CEO, it turned out that they have minimal overlap with us, but are hoping to build or partner with development operations in Mexico. Together, we can fill that gap and meet more customers’ needs without huge investments on either side.

New relationships with Mexican government initiatives

The Mexican government maintains a number of initiatives to support and advance the IT industry, high tech, and technical education. Some of them, such as MexicoIT and MexicoFIRST, we know well and have worked with for years. At Nexus 2015, I also met with a representative from ProMéxico’s New York office who may help us connect with financial services companies. The organization appreciates that Tiempo is creating quality jobs in multiple Mexican locations.

My conversation with IJALTI, which is a private, nonprofit organization that helps foster technology in the state of Jalisco, lead to many resources to help with our new facility expansion in Guadalajara. I expect there will be many other opportunities and exchanges with both IJALTI and ProMéxico.

If you would like to find out more about nearshoring opportunities and what Tiempo Development can help you accomplish, please get in touch with me at cschertz@tiempodevelopment.comor send a note to contact@tiempodevelopment.com. You might also find our case studies and services interesting.

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