Whereas India, China, Eastern Europe, and Russia get the most attention when it comes to outsourcing IT work, Brazil is fast becoming a competitive destination, offering top-quality IT talent in an intriguing location, business-wise.

Of course, every location and workforce, including here in the States, has pluses and minuses — be it wage scale, time zone, professionalism, or understanding of business requirements. With that in mind, Brazil offers a workforce of IT professionals worth considering for your next outsourcing endeavor.

For tips on landing an IT job in Brazil and beyond, see InfoWorld's guide to offshoring yourself.

I spoke with Antonio Moreira, CEO of Stefanini IT Solutions' North American operations. Stefanini is a Brazilian IT service provider with 7,000 employees specializing in IT consulting, software development, and integration.

Brazil: an alternative to India and China
First off, Moreira doesn't believe that choosing between, say, India and Brazil as your outsourcing location necessarily has to be an either/or proposition. Rather, he believes companies may want to mitigate risk by using alternative sites.

That said, Moreira does promote Brazil as a place with a lower turnover rate than India, and as a place where IT professionals have a high degree of technical skills and business savvy. Stefanini, for example, experiences an average of 15 percent employee turnover, Moreira says.

As for technical skills, São Paulo has the second-largest community of Java programmers outside of the United States.

Brazil also has what Moreira calls a "western" business culture, including a large financial and banking industry footprint. This means the Brazil IT workforce includes a great many mainframe programmers as well.

"Brazil has a fabulous infrastructure to support the banking industry, and it is leveraged for other industries," Moreira says.

Moreira also says that if you have a Brazilian team on a project and there is a problem that would jeopardize the delivery deadline, Brazilian IT culture is such that Brazilians will share that information with the team back in the United States immediately.

"Brazilians are more proactive," Moreria says. "If they see they are not able to meet the deadline, they do something. They won't wait until the last minute and then say they can't meet the deadline."

I spoke with two U.S. companies about their experiences working with the Brazilian outsourcer.

HNI Corp., in Muscatine, Iowa, and Idera, based in Houston, turned south to Stefanini rather than east to augment their IT staffs.

HNI, a large office furniture manufacturer, and Idera, a software company that creates tools for managing and securing Microsoft Windows Server, first turned to outsourcing because the available local talent pool in their respective areas was tight.

Rural Iowa isn't the easiest place to find IT talent or attract young, upwardly mobile IT professionals, says Mike Roelf, applications manager at HNI. Moreover, Roelf adds, HNI competes for the available talent pool with local giants such as Monsanto and John Deere.

Competition is what keeps Idera from finding sufficient IT talent in local Houston, as it draws from the same pool as do the giant oil and gas companies.

"We compete with the energy industry here, so anyone that can write code, even poorly, is hired by those companies," says Rick Pleczko, Idera's CEO.

Those are the companies' rationales for outsourcing. But why Brazil, I asked Pleczko and Roelf?

Brazil's advantage No. 1: Synchronized business hours
Time-zone overlap proved key to both HNI's and Idera's decisions to outsource to Brazil.

Idera's Plezco says that trying to manage an outsource development team across an 18- to 24-hour time difference would be a daunting task that would have to change the way Idera's teams work.

"If we had a time-zone difference, we would have to write amazingly detailed specs and hand them over and wait for a period of time for feedback and agreement before we let them build. That's not the way we work," says Plezco. Idera's development teams work iteratively. The teams are "exploring and learning as they go."

"What we needed was an outsource team that could provide us with remote people but who could embed themselves in our teams rather than having a separate team," Plezco says.

São Paulo is never more than three hours ahead of the Eastern time zone in the United States, giving Stefanini the ability to adjust hours locally to suit the customer.

For HNI's Roelf, the biggest internal barrier to a successful outsourcing partnership is developing the kind of documents, aka "artifacts," that work well with the outsourcer's environment.

With a decade's work with outsourcers in India, and having traveled to Beijing, Shanghai, and Hong Kong, Roelf has come to realize that outsourcing venues such as Brazil offer much fewer hurdles to collaboration in terms of the culture of IT here and abroad.

Brazil's advantage No. 2: Cultural alignment of IT
Plezco adds yet another plus to working with a near-shore country that shares many of the same cultural values.

"We didn't want the culture of 'You tell me what to build, and I will build it, even if I think it is the wrong thing to build,'" says Plezco.

Working with IT staff in Brazil has provided a different experience for Plezco. In Plezco's experience, a Brazilian team will say something like, "We understand what you are trying to do, but we think you will be better off to do this another way."

"This approach is prevalent in the Brazilian workforce," Plezco says.

Cost savings over U.S.-based talent is about two to one, says Plezco.

Both companies believe they could not have developed the number of applications they have completed if they didn't outsource.

"Brazilians embrace the opportunity to work long hours without saying a word, and the next day they are right back first thing in the morning," Plezco says.

Softex with the support of APEX, is once more sponsoring for the 5th time the Brazil IT initiative at the Gartner ITXpo 2008. The event will take Place at the Dolphin Hotel in Orlando, FL from 12th to 17th of October.

The Brazil IT pavilion is an opportunity for Brazilian IT providers to market services to US buyers and technology partners. Together with the show floor pavilion, the initiative is also sponsoring company specific boardroom presentations for C-level executives. These presentations have a success track record of actual contract deals in the past events and are the perfect environment for business.

Brazilian companies interested in being part of this event, may email fernando@cariello-usa.net or directly SOFTEX at psi-eventos@nac.softex.br for further details. US companies interested in attending the ITXpo 2008 show floor only can also contact the same addresses for a complimentary invitation. Space is limited; please contact us as early as possible to guarantee your participation.

May 20 (Bloomberg) — When Catarina Delboni traded in her generic computer for a new system from Hewlett-Packard? Co., she joined the ranks of Brazilian consumers taking advantage of lower prices and payment plans to buy from the top U.S. brands.
Her old machine was a lumbering Frankenstein pieced together with parts from different companies, said Delboni, a 22-year-old engineering student in Sao Bernardo do Campo. The new one, bought in March for 1,800 reais ($1,084) with her father's credit card, is faster. Spreading the cost over 10 payments ``definitely made my life easier,'' she said.
Brazil ranked as the fifth-largest PC market last year as bank credit offers, installment plans and growing prosperity fueled purchases, especially among low-income consumers. The shift is a boon to Hewlett-Packard? and Dell Inc., the world's top PC makers. A tax break for PC makers has allowed them to cut prices and compete with unregulated sellers whose so-called gray- market machines dominated the market.
``You have a consumer market that's exploding as people have more access to credit, said Mario Anseloni, managing director of Hewlett-Packard's Brazil division. ``That's transforming the whole economy.
Demand in Brazil is helping PC makers expand revenue as U.S. spending slows. Hewlett-Packard?, which generates two-thirds of its sales outside the U.S., may disclose fresh evidence of the trend today when it reports second-quarter results. Sales grew 11 percent to $28.3 billion in the period, according to a preliminary report last week.
Overtaking TVs
Total Brazilian PC shipments rose 38 percent to 10.7 million units last year, according to research firm IDC in Framingham, Massachusetts. That marked the first time that shoppers bought more PCs than television sets in the country. Brazil's PC market, which ranked seventh in 2006, is poised to take third place by 2010, behind the U.S. and China. Japan and the U.K. are now third and fourth, IDC said.
Palo Alto, California-based Hewlett-Packard? fell 58 cents to $46.71 yesterday in New York Stock Exchange trading. The shares have declined 7.5 percent this year, dragged down last week by concern that its $13.2 billion acquisition of Electronic Data Systems Corp. is too costly. Round Rock, Texas-based Dell, down 14 percent this year, declined 11 cents to $21.20. 5
Brazil's economy last year grew at the fastest pace since 2004 and should be able to maintain annual growth of as much as 4.5 percent, Standard & Poor's said in April after raising the country's debt rating to investment grade for the first time. The upgrade will spur foreign investment, furthering economic growth.

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According to IDC, IT in Latin America will create 630 thousand new jobs until 2010. Brazil, as the largest pool with 892 thousand IT workers today representing 47% of total IT positions, will benefit the most. The new jobs will be created on the software segment, which represents today 69% of the Latin America IT sector, which totals 1.3 million jobs. IDC also predicts that by 2009, software will grow to 74% of an 1.8 million jobs market.

No single nation dominates the IT and business process outsourcing industry in the Western Hemisphere, and Brazil is eager to claim the title. It ultimately wants to compete with India, and industry promoters say proximity and cultural similarities to the U.S. make it a better fit than India or other outsourcing nations in Asia.

An arcane tax system and the lack of a qualified workforce have so far stifled Brazil’s ambitions to become a force in the global business process and IT outsourcing market. But that’s changing, as Latin America’s most populous nation attempts to claim a bigger portion of an outsourcing market annually worth some $45 billion, according to McKinsey? & Co.
In 2007, Brazil hopes to tally $800 million in outsourcing revenue, compared with $600 million in 2006. Its goal for 2010 is $5 billion, says Antonio Gil, chairman of the Brazilian Association of Software and Services Export Companies, a trade organization in Sao Paulo.

No single nation dominates the outsourcing industry in the Western Hemisphere, and Brazil is eager to claim the title. It ultimately wants to compete with India, which claims 70 percent of the international business process outsourcing market.
Brazil is making important gains, drawing Whirlpool Corp. and Gap Inc. as outsourcing clients for tasks ranging from IT services to back-office work. Meanwhile, IBM, Accenture and Electronic Data Systems are expanding and hiring more employees in Brazil to accommodate projected growth.

Gil says Brazil has several advantages over India. For one, it is in similar time zones and in closer geographic proximity to North American companies that offshore their operations. The U.S. also shares more cultural similarities with Brazil than India or other outsourcing nations in Asia, he says.
"The countries share many cultural references—music, movies, television shows, etc.," says Carlos Diaz, vice president of Pan-America? and global accounts officer for Meta4 and an expert of HR issues in Latin America. "You wouldn’t have to explain who Mickey Mouse is to a Brazilian, but that may not necessarily the case when it comes to somebody from India."
"Outsourcing is not just about completing a project; it is also about having a relationship with a vendor that you know and trust," Gil says. "This becomes much trickier when your outsourcing partner has different cultural sensibilities and is on the other side of the world."

Outsourcing to Brazil is costlier, given high taxes and a relatively strong national currency. Still, the expenses may be offset by relatively low turnover rates, ensuring project consistency and cutting the risk of mistakes. Gil says Brazil’s turnover in the outsourcing industry is roughly 20 percent, compared with India’s rate of about 40 percent.
Outsourcing to Brazil makes sense, according to Alexandre Brandao, manager of business support center for Exxon Mobil in Sao Paulo. He says Brazil is particularly strong in IT and business processing. However, handling customer support services via domestic call centers may be a challenge because of a lack of English speakers in the field.
Brazil faces a major hurdle in its need to produce a sufficient number of workers who have both the appropriate language skills and the technical training to keep the country’s outsourcing plan on pace for 2010. Gil estimates that 100,000 additional workers will be needed. Currently, there are 10,000 Brazilians working in the outsourcing industry.
Gaining ground on competing nations won’t come easy, says Bruno Laskowsky, a partner at consultancy A.T. Kearney in Sao Paulo. "This is not a game for kids," he says. "Brazil is going to have to invest significant resources if it is going to achieve its goals." What’s more, the private sector and the government will have to work in tandem.
It appears that this is already taking place. Government officials and the Brazilian Association of Software and Services Export Companies, which includes 29 companies, meet regularly. They retained A.T. Kearney to deepen their fundamental knowledge of the global outsourcing industry and to create a plan, Laskowsky says.

The association, the Ministry of Labor and the Ministry of Sciences and Technology are funding several initiatives, including a pilot program that includes six months of e-learning and classroom technical training to be followed by intensive English-language studies. Some 8,000 individuals in 14 cities are enrolled in the pilot program, Gil says.
Gil also is meeting with government officials to lobby for lower taxes for multinationals.
"An increasing number of people realize the country needs to modernize its tax system in order to compete effectively in the global marketplace," Gil says. "There is growing momentum and I think we can succeed."



Gina Ruiz is a Workforce Management staff writer based in Los Angeles. E-mail editors@workforce.com to comment.

With the motto “We do Business As You Do”, Brazil IT, the cooperative initiative, partly sponsored by SOFTEX (Association for Promoting the Brazilian Software Excellence) and APEX (Trade and Investment Promotion Agency), is sponsoring the Gartner Symposium / ITXpo event. The 2007 edition will be held at the Dolphin Hotel in Orlando, Fl, from 7 to 12 of October.

With a one trillion dollars economy, Brazil is called home by 95% of SP500 companies. The market demands created a pro active IT services industry, creating solutions with emphasis in the western culture affinity and cultural plurality, praising customer service and efficiencies. As stated by Djalma Petit, Softex Export Coordinator, Brazilians are rich in “Resolutiveness”, which is translated as the capacity to effectively deliver solutions to resolve problems.

For the 2007 edition of ITXpo, Brazil IT is bringing the following top software and services provider:


www.actminds.com
A Global IT services provider led by a team of highly qualified and certified professionals with CMMI-5 and PMI. Actminds strengths are methodology and process, with an in-depth understanding of technology and business, as well as flexibility and adaptability to our client's needs.

With Clients such as Yahoo, Johnson & Johnson, BankBoston?, Goldman Sachs, Lucent Technologies, General Motors and Volkswagen, Actminds' development centers are in a compatible time zone with the US East Cost, only one time zone east of New York.

www.lightinfocom.com.br

Lightinfocom is the creator of LightBase?, a full text-retrieval database with RAD - Rapid Application Development, a "programming by form designing", withof multimedia - sound and images -, Internet access functionalities and full-text-retrieval capabilities. Lightbase has received 5 Brazilian Productivity Awards and was selected as Editors Choice by PC World Spain.
Lightinfocom provides full customization services and support for lightbase and has implemented its products for the Spanish National Police, Interpol, Ministry of Defense (Brazil and Spain), ISTIC (China), Barclays Bank, Brazilian Ministry of Health, Infraero (Brazilian Airport Agency), Bradesco (Brazilian Bank) and GOL (Low Cost Brazilian Airline)

www.modulo.com

Successfully implementing over 4,000 security projects in more than 1000 clients, Modulo Security is Latin America’s market leader for IT governance, risk and compliance management. The company was founded in 1985, currently employing 300 people. Modulo Security received the first Certified ISO 27001 in the World, which sets the standards for Information Security Management System.

Modulo’s Risk Manager™ is a product that automates the processes required for assessing and eliminating security vulnerabilities and attaining regulatory compliance. The product is a result of a seven year of development process, becoming a mature and well proved product, being used by over 50 consulting firms and is implemented in 200+ companies worldwide, such as: IBM, Schlumberger, Santander Bank, Microsoft, Xerox, FMC Technologies,VisaNet? ( VISA ), Redecard ( Mastercard ), and New York University Hospital.

www.politec.com

Brazil, United States, Germany, Belgium, China, France, India, the UK, and Japan. For nearly 40 years the world has come to know and respect Politec's capabilities, which are also available for your company. Politec offers world-class services throughout Brazil, with 15 technology centers strategically positioned throughout the country, and innovative solutions that are recognized worldwide.

As a leader in the sector, Politec always stands behind its clients. After all, IT intelligence means thinking ahead. So far ahead that when you're thinking about the long term, Politec will be ready to take you there. Politec has more than 6,500 trained professionals who deliver consistent results for our clients and whose work has made Politec the most highly trained private-sector Brazilian company in Information Technology services.

Here are a few examples of recognition by the international community:
- World Economic Forum New Champion Global Growth Companies Founding Member (Sep/2007);
- Included in the Global Services GS100, a prestigious annual list of the world's 100 most innovative service providers, as well as named a South of the Border Leader (Global Services magazine, Feb/2007);
- Top 10 Best Performing IT Services Provider (Global Services magazine, Feb/2007);
- 2nd in Gartner’s top 15 “Emerging Outsourcing Players" (BusinessWeek magazine, Jan/2006)

www.stefanini-usa.com

Stefanini IT Solutions has been ranked among the top ten End to End Global Outsourcing Vendor in a survey by the Brown & Wilson Group, publishers of the best-selling book The Black Book of Outsourcing. Ranked #9 in 2006, Stefanini IT Solutions is the first South American company to enter the ranking.

Founded in 1987, with over 5,000 employees in 32 offices in 14 countries in South America, North America, Europe, Africa, and India, Stefanini has over 1000 clients worldwide. With ONSHORE, NEARSHORE and OFFSHORE Capabilities, Stefanini offers Professional Services, Managed Services, Staff Augmentation, and BPO. Stefanini was the first Brazilian company to achieve CMMI 5 certification.

The company is in the USA since 2001 with offices in Ft Lauderdale, Atlanta and New York and has more than 40american clients, including top Fortune 100 companies.

ABOUT SOFTEX (www.softex.br) - Society for the Promotion of Excellence in Brazilian Software - SOFTEX - is a non-profit organization that promotes the Brazilian software and related services industry's competitiveness. SOFTEX has more than 1,300 members.

ABOUT APEX-BRASIL (www.apex.org.br) The Brazilian Export and Investments Promotion Agency - APEX - is a government agency focused on promoting Brazilian products and the country image.

For more information on Brazil IT or on how to participate on the event, contact fernando@cariello-usa.net.

For the fourth year, Brazil IT, the Brazilian IT services technology initiative supported by SOFTEX (Society for the Promotion of Excellence in Brazilian Software) and APEX-Brasil (Brazilian Export and Investments Promotion Agency) is sponsoring the Gartner Symposium / ITXpo event. The 2007 edition will be held at the Dolphin Hotel in Orlando, Fl, from 7 to 12 of October.

Gartner Symposium/ITxpo is the industry's largest and most strategic conference for senior IT and business professions. More than 6,000 senior business and IT strategists from virtually all major industries will gather to gain the latest advice on the biggest challenge: Driving profits and performance with IT.

Based on previous feedback from Clients, the Brazilian companies attending the event have high expectations. Brazil has become the most researched location for outsourcing outside India, . With a highly skilled workforce, and deep knowledge of western business models, Brazilians offer an excellent cost benefit ratio, producing creative solutions with quality and supported by industry best practices. Global providers have a presence in Brazil for a very long time. IBM for instance opened the Brazil office in 1917 and never closed, says Christine Studart from the Brazil Information Center in Washington, DC. Four years ago, according to a MIT research Brazil was the hidden jewel of IT services. Now with the presence of all global provides in the country, including the big Indian players, Brazil is mainstream, as remarked Gartner analysts at the 2006 Symposium opening section.

The Brazil IT outsourcing initiative grew from the local companies’ maturity achieved on the internal market. With many years of experience serving a 18 billion dollars industry, the presence of Brazilian companies represented a fresh breath on the offshore outsourcing market, as it was accompanied by the country's low geopolitical risk, modern telecom infrastructure, favorable business environment, and tax benefits. Brazil IT segment has growing a steady 15% a year, positioning Brazil as one of the most important technology markets in the world.


ABOUT SOFTEX (www.softex.br) - Society for the Promotion of Excellence in Brazilian Software - SOFTEX - is a non-profit organization that promotes the Brazilian software and related services industry's competitiveness. SOFTEX has more than 1,300 members.

ABOUT APEX-BRASIL (www.apex.org.br) The Brazilian Export and Investments Promotion Agency - APEX - is a government agency focused on promoting Brazilian products and the country image.

For more information on Brazil IT or on how to participate on the event, contact fernando@cariello-usa.net.

In a the recent Conference, Gartner Analysts unveiled the 10 most disruptive technologies for the next 5 years. From multicore processors to web mashups there are points to be exploited everywhere. The beauty of the unleashed Gartner hype cycle analyses is that the core of these technologies are location free user experience.

For instance one of the listed trends is social software. From Orkut to Wikis, the power of these communities relies on the quality and trustworthy of the people collaborating on the development of the social environment. There is no geographic segregation on online communities, although some countries have more presence on providing server technologies on others users, no one has ever asked where the server is located, or the developers reside, nor the users, they all are online.

Gartner outlines that multiple core chips will go mainstream by 2012. Intel Tera-scale computing is a worldwide program in 11 cities, involving more than 80 projects. The goal of Intel is to produce energy efficient multicore processors achieving teraflops of computing capacity, that will be need to handle the future applications of 3D design and video.

This processing power, as disruptive as it is by itself, will also enable the enhancements of others disruptive technologies. Web based platforms attached to social software with a pinch of virtual communities are already in the hype for software companies. Online virtual worlds like Second Life or the massive social games (the Brazilian Taikodom is the newcomer) congregate millions of users, generating unforeseen business opportunities for companies. As an example a Belgium company has created a Second life real estate company that “builds” houses on the virtual environment, charging actual dollars. Companies are already accessing the possibility of establishing complete online offices. The cost of development of corporative virtual environments are offset by the savings with real estate, energy, maintenance and others real world costs.

As a final world, recognizing Brazilians as the second biggest community on Second Life, Intel celebrated its 20 years in Brazil throwing a party at the virtual environment, distributing freebies, and with the presence of celebrities and online reporters. The Brazilian Airline TAM has also launched the airline on Second Life, accruing mileage points for users that use the airline’s aircrafts to visit the virtual representation of the company’s actual destinations.

Executives at Fotolog Inc. cheered in 2002 when they saw a surge in the number of people using their photo-sharing and social-networking Web site. Then they scratched their heads: The explosive growth was in Brazil.

Yesterday, New York-based Fotolog was acquired by Hi-Media Group, an Internet advertising firm based in Paris, for about $90 million, making it the latest acquisition of a social-networking Web site and the first one with a user base largely outside the U.S.

Social-networking sites, where users post profiles, chat or join communities, have become some of the hottest properties on the Internet, making up nearly half of the world's top 10 most-visited sites.
In the U.S., Facebook.com and Myspace.com are the best-known sites, drawing tens of millions of daily visitors. Now, with the U.S. market getting crowded, attention is turning overseas, particularly to emerging markets such as Latin America, where Internet use is increasing rapidly and competition is less intense.

The deal for Fotolog also is shedding light on Brazil's role as an arbiter of Internet success. With some of the world's most enthusiastic Internet users, the South American country is acting "as a leading indicator of future trends," said John Borthwick, Fotolog's chief executive officer and a former top technology executive at Time Warner Inc. and AOL.

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Offshore outsourcing managers used to traveling back and forth to Bangalore may be trading in those frequent flier miles for tickets to São Paulo or Rio. And not for any much-needed R&R.

Some IT organizations experienced in offshoring are looking to Brazil as an emerging option for software development and maintenance services. In most cases, the move is part of a diversification strategy as demand continues to put upward pressure on wages in India.

In addition, some companies may be looking for a way to bring offshore work a bit closer to home in the Western hemisphere. “There are instances where Brazil is used instead of India because of its closer proximity and similar time zones to the U.S.,” says Eugene M. Kublanov, COO and managing director for offshoring outsourcing advisor NeoIT

Brazilian IT services companies are eager for the international business. The domestic market for IT work is growing at a decent 17 percent a year, according to Jair Ribeiro, president of São Paulo–based CPM Braxis, Brazil’s largest IT services company with $500 million in annual revenue. But CPM Braxis and other local market leaders, such as Brasilia-based Politec and Rio de Janeiro–based DBA, are ravenous for a piece of the offshore outsourcing market, which is growing at more than twice that rate.

These companies are contending with some much larger competitors. Most multinational outsourcers, including IBM, EDS, HP, Unisys and Accenture, have set up shop in Brazil. IBM, for example, is using Brazil as a hub for infrastructure management, employing more than 9,000 people in Campinas, 90 minutes outside of São Paolo, says Kublanov. Tier-1 Indian players, including TCS, Satyam, Infosys and Wipro, and larger Mexican IT services companies including Neoris and Softek, have moved in as well.