Technology

Meet new Egypt – a service delivery hub for global companies

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Meet new Egypt – a service delivery hub for global companies

The world today is becoming a global village with companies investing in different nations to remain afloat and competitive. Consequently, demand for offshoring IT services has risen dramatically in an effort to explore the ripe opportunities (financial attractiveness or skilled labor) that many offshoring destinations promise to offer.

Nevertheless, mitigating operational risk in today’s dynamic and disruptive world has become more and more challenging for businesses striving to achieve global presence, agility & responsiveness. In the light of the pandemic, natural disasters, unstable economies and political turbulence taking place, businesses are looking to put their eggs in different baskets as a way to strengthen their business’s resilience. With the increased pressure firms are facing in relation to managing operational risks, expanding their business and providing high-value services, more are looking to achieve the delicate equilibrium for reducing cost while driving innovation. With a spotlight shining on destinations that can equally provide cost-effective & innovative models, business leaders can now breathe a sigh of relief.

Egypt, famously known for its ancient history and rich diverse culture, continues to grow as a service delivery hub for global companies in Europe, North America and Asia. This has come as a result of Egypt’s ability to offer business leaders the opportunity to expand their global footprint and offer high-value services without weighing down budgets.

RESILIENCE & AGILITY

With its recent performance in The Economist’s Normalcy Index, Egypt was ranked 4th among the top 10 countries showing resilience during COVID-19 pandemic in March 2020, sector companies were able to successfully migrate 50-80% of their workforce to WFH within two weeks only without services disruption. In addition, owing to the country’s political stability and absence of natural disasters, the socio-economic risk factors for Egypt have significantly become non-existent over the past few years, with the government showing ultimate commitment to its 2030 national agenda and the United Nations Sustainable Development Goals (SDGs). This has contributed to a welcoming environment with foreign investments growing significantly into the country. According to IMF, Egypt could see foreign direct investment jump this year as much as 60% this fiscal year compared to last year.

TALENT

With its young, dynamic & multi-lingual talents reaching 550K graduates annually, Egypt offers the largest pool of calibers in the Arab speaking world and second largest in EMEA region. According to Ernst & Young (EY) findings, 80% of the working population speaks English & other European languages vs. 20-65% peer Eastern European offshore centers. Furthermore, digital transformation initiatives among government entities and private enterprises has propelled Egyptians to learn and acquire new technological skills to increase their IT competence. Today, such tech talents contribute to the global success of multinational companies such as Ericsson, Vodafone and Dell Technologies by providing their customers worldwide with innovative tech solutions powered by AI, Analytics, IoT & Big Data.

The quality of the human capital in this country is pretty much second to none and as a leader of a large organization, we desperately want to attract that talent into our business – says Gary Adey, Vodafone Shared Services’ Group Director.

Vodafone Shared Services has continued to grow in Egypt reaching 8000+ employees serving Vodafone Group worldwide with edge-cutting solutions & services powered by emerging technologies such as AI, IoT, Analytics etc.

Taking advantage of a rich multilingual pool of talents well versed in 20+ languages, multinational Webhelp entered Egypt.

As put by Phillipe Broutin, Webhelp’s General Manager of Africa Development and Alaa El Khishen, CEO at Webhelp – You don’t need to hire ex-pats and import them because the talent pool is rich and mature enough to develop an incredible CX team domestically. The level of expertise and qualifications we see from middle, senior, and junior management teams are impressive.

Interestingly, this unique talent comes with a competitive advantage. As per EY, cost arbitrage for Egyptian talents are up to 60% vis-à-vis other leading regional offshoring hubs in Eastern Europe & South Africa.

IT & INNOVATION

Home to 500 Fortune companies with the likes of Amazon, Microsoft, IBM, Uber as well as tech-powered startups like Instabug, Vezeeta & Swvl, Egypt is leading the innovation scene in MENA region attracting business leaders on the hunt for innovations and tech-powered solutions to today’s global challenges. In 2009, Dell Technologies Center of Excellence was established with an expert network of resources offering technical support and consulting services while working on research and product innovation for the group. Today, the COE provides world-class technologies and innovations powered by AI, RPA, IoT, Analytics and Big Data to serve markets across the Middle East, Africa, Europe, US, and Asia in 14+ languages helping customers accelerate their digital transformation and IT processes.

In 2020, Ericsson’s new AI & Analytics Hub in Egypt achieved a key milestone by shipping its first Cognitive Software to be used by Ericsson customers worldwide to design and optimize networks.

Egypt has been heavily prioritizing digital transformation by setting ambitious goals through Egypt Vision 2030. To achieve the targets of Vision 2030, the country has further created the ICT 2030 strategy and the Digital Egypt initiative with objectives of developing ICT infrastructure; fostering digital inclusion and encouraging innovation to aid the nation’s transformation into a knowledge-based economy Eva Andrén, Ericsson Vice President and Head of Managed Services.

Valeo Internal Automotive Software Center employs over 2000 engineers developing cutting-edge R&D software solutions and intuitive driving technologies for automotive companies

globally.

 – Offshore centers’ competitive advantage is usually related to cost efficiency. In Valeo Egypt, we have achieved the extra miles, not only as a cost-oriented center, but also as an innovation hub – Motaz Agamawi, Head of Research and Innovation at Valeo Egypt.

Egyptian-grown startup Instabug, now helps global clients like PayPal, eBay, Samsung, Phillips, and Shopify collect real-time contextual insights as well as enhance user experience quality for mobile apps reaching more than 25 thousand other companies worldwide.

INFRASTRUCTURE & GOVERNMENT INITIATIVES

In line with its 2030 Vision and Digital Transformation, the Egyptian Government has invested $2bn in internet infrastructure upgrades which has aided in supporting the surge in demand for ICT services for remote work, digital payments and e-commerce platforms during the pandemic. To further accelerate the transformation of Egypt into a regional digital hub, Ministry of Communication & Information Technology (MCIT) focuses mainly on promoting and developing: Digital Transformation, Digital Skills & Jobs, Digital Innovation, Digital Infrastructure and Legislative & Regulatory Framework.

To boost its position as a provider to world-class ICT & outsourcing services, the Egyptian government has undertaken several nation-wide projects to promote technological innovation, empowerment of young talents, creation and growth of new IT & tech-enabled local companies. It has established science and technology parks across the country, a new Applied Innovation Center to boost R&D, and innovation clusters. Furthermore, MCIT is investing EGP 600 million in Creativa Innovation Hubs, where hubs reside inside the universities with external access to support students as well as start-ups.

To empower young talents and promote digital skills, MCIT and its affiliate, ITIDA (IT Industry Development Agency), launched several governmental initiatives such as Egypt Future Work is Digital (FWD) and Digital Egypt Builders Initiatives (DEBI). Launched in May 2020, Egypt Future Work is Digital initiative avails fully funded online training in Data Analytics, Web Development, and Digital Marketing to 100,000 youths through Udacity e-learning platform. To date, 52,000 graduated with more than 10,600 active free- lancers on Freelancer.com, Upwork, and other leading platforms. Digital Egypt Builders Initiative launched by MCIT in September 2020, seeks to empower the next generation of engineering and computer science graduates preparing qualified leaders to work in the entities responsible for transforming Egypt into a first-class digital state. Moreover, in June 2020, MCIT signed 4 MoUs with Dell Technologies, Vodafone, Kaspersky, and Huawei to develop technology skills incl. AI, Cybersecurity, data science, and cloud computing.

CONCLUSION

Key success factors of overseas expansions will always be attributed to regional location, competent talents, unique & innovative products/services and cost-competitiveness. Business leaders looking to grow their global footprint and provide client-centric solutions & services will find that Egypt as a destination offers high-tier capabilities such as business continuity, digitally skilled multilingual workforce, high-value services as well as a rapidly evolving business & IT environment.

Author: Yara El Ashram, Information Technology Industry Development Agency (ITIDA)