Outsourcing Risks - 25 Most Dangerous cities

After an eventful year that saw terrorist attacks in Mumbai, kidnapping for profit in Mexico, and the unexpected meltdown of Satyam, one of India's biggest IT services firms, the corporate cries to get things done "better, faster, cheaper" and offshore, may begin to be drowned out by the more moderate mantra of today's outsourcing customer: "safer, more stable and definitely more secure."

Interruptions to business customers have upset the sense of security that made Indian offshore outsourcing an uncomplicated buying decision. Companies are putting on hold the offshore projects that were routine just a year ago, puting more effort into investigating and analysing alternatives that help mitigate unresolved risks.

Promising locations like South Africa, Columbia, Malaysia, Thailand and Mexico have done little in terms of government initiatives or social change to allay client fears about their safety, as an outsourcing destination. Some countries with more established IT export businesses e.g. the Philippines and Brazil, have progressed slower than expected.

India's "tier II" cities, once poised to take business away from the cities like Bangalore, do not have the infrastructure and social improvements necessary to compete. India's track record does not bode well for fast development. This making other locations such as Latin America and central and eastern Europe more appealing to corporate organisations.

A number of emerging offshore locations have made great strides in mitigating risks inherent to their countries, while still keeping their costs and overheads low, e.g. Poland, the Czech Republic, Chile, Egypt, etc.

The risk factors involved in offshore outsourcing e.g. terrorism, potential war, disaster, network breaks, environmental disregards, crime and epidemic disease, make contingency plans a greater necessity. The emerging trend currently, is for IT outsourcing customers to seek out solutions closer to home, nearer their own shores or in the same country, where potential problems can be more readily understood, predicted and better managed.

The 25 Riskiest Outsourcing Cities in the World

Rankings based on mean scores in ten areas of risk as reported by The Brown-Wilson Group's "2009: The Year of Outsourcing Dangerously"

1. Bogota, Columbia
2. Bangkok, Thailand
3. Johannesburg, South Africa
4. Kuala Lumpur, Malaysia
5. Kingston, Jamaica
6. Delhi/Noida/Gurgaon, India
7. Manila/Cebu/Makita, Philippines
8. Rio de Janeiro, Brazil
9. Mumbai, India
10. Jerusalem, Israel
11. Curitiba, Brazil
12. Dalian, China
13. Juarez, Mexico
14. Brasilia, Brazil
15. Chandigarh, India
16. Colombo, Sri Lanka
17. Ho Chi Minh City, Vietnam
18. Quezon City, Philippines
19. Accra, Ghana
20. Pune, India
21. Chennai, India
22. Hanoi, Vietnam
23. Bangalore, India
24. Hyderabad, India
25. Kolkata, India

The Worst Three Cities for;

Corruption & Organized Crime

1. Bogota, Colombia
2. Juarez, Mexico
3. Johannesburg, South Africa

Heightening Trans-national & Geopolitical Issues

1. Delhi/Noida/Gurgaon, India
2. Jerusalem, Israel
3. Colombo, Sri Lanka

Unsecured or Unprotected Networks and Infrastructure

1. Bogota, Colombia
2. Bangkok, Thailand
3. Kingston, Jamaica

Unstable Currency

1. Bangkok, Thailand
2. Bogota, Colombia
3. Johannesburg, South Africa

Personal Crime Rate/Police-to-Citizen Ratio

1. Bangkok, Thailand
2. Johannesburg, South Africa
3. Rio de Janeiro, Brazil

Environmental Waste & Pollution

1. Bangalore, India
2. Chandigarh, India
3. Kuala Lumpur, Malaysia

High Terrorism/Insurrection Threat

1. Mumbai, India
2. Delhi/Noida/Gurgaon, India
3. Jerusalem, Israel

Legal System Immaturity

1. Bangkok, Thailand
2. Bogota, Colombia
3. Kingston, Jamaica

Weather/Climate Threats

1. Kingston, Jamaica
2. Manila/Cebu/ Makati, Philippines
3. Bangkok, Thailand