IT Sourcing Europe compares and contrasts the key findings of its Swedish, Norwegian and Danish IT Outsourcing surveys 2010.

IT Sourcing Europe, a UK-based nearshore IT outsourcing (ITO) research and advisory company, has surveyed ITO companies in Denmark, Sweden and Norway between June and October 2010 in order to identify this year’s key trends in Scandinavian software development (SD) outsourcing. Overall, the 697 Scandinavian companies took part in the surveys and anonymously shared their ITO experience with a broader European business audience.

According to the survey findings, in 2010 more Scandinavian companies outsource their software development function nearshore (within or close to the same time zone) than offshore (at least 2 time zones away from the home country), and namely: 34% versus 19% of Danish companies; 37% versus 25% of Swedish companies and 32% versus 27% of Norwegian companies. Regarding the future outsourcing destination, the following percentages of companies plan to outsource nearshore and offshore: in Denmark – 25% versus 19%, in Sweden – 43% versus 21% and in Norway – 42% versus 12% of companies.

Regarding the major pressures driving Scandinavian corporate decisions to outsource software development in 2010, cumulative 27% of companies outsource to reduce operating costs, while 21% of companies outsource due to a shortage of domestic IT resources and specific skills. Additionally, cumulative 17% of Danish and Swedish companies outsource to accelerate time to market via scalability and flexibility, while 15% of Norwegian companies outsource to improve their business development strategy.

Regarding the volume of the outsourced software development, most of Swedish companies (31%) outsource 90% to 100% of their SD function, while most of Danish companies (25% of respondents) outsource 60% – 89% and most of Norwegian companies (39%) outsource 40% – 59% of their SD function.

Regarding the actual savings from the outsourced development, cumulative 37.5% of Danish and Swedish companies save 40%-59%, while 37% of Norwegian outsourcers save 10%-24% of operating costs.

Regarding the actual incurred annual costs of outsourcing compared to the expected (contracted) ones, 53.5% of Danish and Swedish companies said their actual and contacted costs were about the same, while 40% of Norwegian companies said their actual costs were up to 25% higher than expected.

More findings will be available in the European IT Outsourcing Intelligence Report 2010 to be released in November 2010.

(Data courtesy of IT Sourcing Europe. Any reprint requires a link to IT Sourcing Europe’s website)

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