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The Warsaw Voice » Business » September 30, 2013
Business & Economy
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Powerhouse in Business Services
September 30, 2013   
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Poland is the favorite destination for companies operating in the business services outsourcing sector in Central and Eastern Europe, according to a recent report.

Poland accounts for 3.4 percent of all global outsourcing/offshoring jobs, ranking first in CEE, second in Europe as a whole and sixth worldwide, according to fDi Markets, a cross-border investment monitor from the Financial Times. Poland is also third, after China and India, on the Hackett Group’s ranking of destinations for global service centers.
Moreover, in a recent report by the Everest Group, Poland was the only CEE country to be described as a mature market, together with Brazil, China and India.

According to the BPOland Potential and Prospects report drawn up by consulting firm CBRE, together with recruiting experts Hays and the Polish Information and Foreign Investment Agency (PAIiIZ), Poland is the destination of choice for companies operating in the business services outsourcing sector in Central and Eastern Europe. Over the past year, Poland has outpaced India in terms of the rate of job creation and project expansions in the BPO sector, the report says, while the number of people employed in it has been growing steadily by over 20 percent annually since 2008.

Sławomir Majman, president of the Polish Information and Foreign Investment Agency, says, “Statistics comparing the pace of BPO growth in Poland and India, where the number of new establishments is decreasing, show that companies are increasingly choosing CEE and above all Poland as the destination for their investment projects. The successful track record of companies that have invested in Poland also encourages others to enter the market. The key attraction is, however, the availability of a well-educated and qualified work force, the best incentive to invest in Poland.”

Real estate services company Jones Lang LaSalle recently released a report entitled Onshore, Nearshore, Offshore: Unsure?, focusing on the development opportunities offered by the Polish market to foreign investors in the modern business services sector.

According to Patricia Lannoije, Head of Research and Consultancy at Jones Lang LaSalle, the prominent position occupied by Poland on the global business services map has been achieved thanks to a blend of features including a broad pool of highly-qualified and experienced employees, state aid, and a favorable business environment for foreign investors.

The developed infrastructure, including the availability of modern office space that meets the specific requirements of business services companies and the depth and maturity of the sector itself have also been crucial factors, Lannoije says, adding that Poland’s central location in Europe, combined with its favorable time zone for global communication and fast access to all major cities on the continent within two to three hours by plane are also important.

Poland’s modern business services sector continues to grow unabated. According to ABSL, an organization that brings together companies from the SSC/BPO/ITO/R&D (Shared Service Centers, Business Process Outsourcing, Information Technology Outsourcing, Research and Development) sector, Poland is home to more than 400 business services centers with foreign capital that employ more than 110,000 people and constitute around 40 percent of total employment in the modern business services sector in Central and Eastern Europe. That number is expected by ABSL to reach between 115,000 and 120,000 by the end of 2013. What is particularly important, the level, scope and complexity of the processes handled by business services centers in Poland are changing significantly in favor of advanced services, thus creating many new opportunities for development.

Jacek Levernes, president of ABSL, says: “Centers operating in Poland are now competing for contracts in the highly-advanced services sector. This process started several years ago when these units began to expand their service portfolios to include tasks that required experience, knowledge and foreign language proficiency. At the moment, we are aiming at a wide range of middle-office processes, with a particular focus on services for investment funds. In addition, we are targeting contracts concerning financial analysis, financial instruments, tax services, transfer pricing, and financial risk management. Within the next few years, Poland will have the opportunity to attract a considerable number of financial services from Western Europe. This may generate another 100,000 well-paid jobs for specialists.”

The common feature of all the centers is that they look for employees who speak a foreign language, preferably English. Young people in Poland are improving their foreign language skills. Today, more than half of the population say they speak at least one foreign language. Moreover, the number of engineering and advanced technology students has grown since 2011. This is the result of factors including the introduction of a range of special courses prioritized by the Ministry of Education. The initiative aims to increase the number of science and engineering graduates. According to experts, this is vital for the Polish economy to continue to grow.

Małgorzata Jasińska, Corporate Accounts Director, CEE, at Hays Specialist Recruitment, says, “We are witnessing an evolution in higher education and increased interest in technology degrees. Today there are nearly 2 million students in higher education in Poland and the number of engineering and technology graduates is growing with each year. We are also seeing successful cooperation between employers and universities, which allows graduates to develop the knowledge and skills required by employers. This is an excellent recommendation for the future and also an opportunity for companies offering more advanced business services such as knowledge process outsourcing (KPO) and research and development (R&D).”

The CBRE report shows that often when a company reviews potential locations for a BPO site, the long list starts with 75 percent of the cities in Poland and the remaining 25 percent in other countries in the CEE region. The largest Polish regional cities such as Wrocław, Cracow, Poznań and the Gdańsk-Sopot-Gdynia Tricity area attract the largest numbers of investors. Over the past 10 years, employment in the business services sector has increased as a result of the expansion of existing centers by companies such as State Street, Hewlett Packard and HSBC, and the appearance of new market players.
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