Look Out World Here Comes China

Gary P. Nowak, Director, KPMG LLP Management Consulting

Traveling 25,000 miles around the world with my client to see proposed service delivery locations throughout the world was eye opening.  We visited Poland, Romania, India and China and saw 15 different delivery sites.  Having been to all countries except China, I knew what to expect.  Poland, Romania and India have all been in the BPO market for years and their capabilities are very strong and have been growing stronger over the years.  These countries continue to move up the value chain to knowledge process outsourcing.  This was my first trip to China to see their capabilities and it was very impressive.

Dalian China really surprised me with the level of talent, quality of the infrastructure, commitment from the government and overall city appeal.  Located in northeastern China on a peninsula with a population of approximately 6.7 million people, Dalian has built very strong BPO capabilities and is committed to significant growth over the years.  We visited two service providers that are each involved with planned communities that will have the capability to support hundreds of thousands of jobs.  Picture a community where you can work, live and shop, that is what Dalian is doing.

 The Chinese government through the Ministry of Commerce (MOFCOM) is highly engaged in growing BPO.  There is significant commitment to build the necessary infrastructure and provide the proper business and tax incentives to make China as appealing as possible.  Not surprisingly, Dalian has an extremely disciplined, regimented culture, and is friendly to westerners, typically creating American names. Dalian has over 22 universities with more than 70,000 students.  Service providers utilize students through internship programs and are developing specific university classes around BPO.  Regimented processes and smart people is a recipe for BPO success.

Our client was also impressed with the quality of the individuals, scope of work being performed and the overall culture.  We met with over 100 individuals and learned about the work being performed for 7 different clients.  Dalian currently supports those countries with specific language requirement i.e. China, Korea and Japan, therefore the size of their centers tends to be smaller than other countries providing BPO services.  Once English speaking countries understand the capabilities being built, they will consider China as a very viable BPO option.

So, Dalian isn’t just a city of squares, fountains, beaches and gardens; it’s city that holds a tremendous value for the future and could become more than just a city to support Asian countries.  Look out world, here comes China.

Visit the KPMG Institutes to get more from KPMG on China and on outsourcing.

One Response to “Look Out World Here Comes China”

  1. Gary, excellent post on Dalian, China. A coastal city, Dalian is beautiful. However, there is outstanding outsourcing infrastructure built in just about all of China’s tier 1 and tier 2 cities, and many tier 3 cities. I’m based in China, and when on vacation in a particular city, I always take time to scope out the local ‘software park’. They truly are dream business communities!

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