Why Romania cannot be called „India of Europe”

3 ianuarie 2008, 16 comentarii

In their search for efficiency and high profit, multinational companies or international giants- draw new outsourcing locations or extensions of their own business on the world map, economical mirages in which at comparatively lower costs than in their native country- imposing qualities and aptitudes can be found. 

 North America has discovered a few years ago the benefits of outsourcing in Bangalore or Delhi (India), Philippines, Costa Rica or China. Europe had Dublin in Ireland, the Czech Republic, Poland – I am using the past tense as these locations have already moved over to make room for new cost effective stars in the area: Romania, Egypt, Ukraine, Estonia.

  Lately, there is a more frequent comparison made between India and Romania based on which of the two is a more cost effective location. From my point of view there is only one common criteria of comparison: we are still cost effective. Besides, there is a series of differences through which either us or them define ourselves as being special: 

– Romania is the only place in the world that can deliver outsourcing services in this moment, in 22-25 foreign languages, at an advanced quality level and at no additional investment in training. In India, English is the base language but there are vehement reactions coming from European or American clients on the strong Indian accent that stands out from every conversation and makes communication difficult. From this standpoint Romania is SPECIAL! 

– From the costs point of view, Romania was in 2005 a strong competition for India on the “marvelous” destinations map. I said “was” because there is an increase in the salary trend, the labor market offer level has increased, the competition on resources is increasingly high, so being the costs of retaining employees and the inferring of a higher and higher attrition rate. All these weaken Romania’s image as Europe’s aspirant leader of the outsourcing market. At the other pole, India is still a leader to where cost efficiency is concerned, taking into consideration that the employee attrition is higher than 24%/ year. Imagine, the salary costs of an American employee located in the US can be used to hire 4 similar specialists in Bangalore. From this standpoint, India is SPECIAL! 

– Romania’s culture is an European one, we are very flexible and easily adaptable to other foreign investor’s cultures and our culture is characterized by not interfering in the most favorable course of a business, on the contrary, we are creative, inventive and open for an outright expression of our feedback, either positive or not. Aspects such as values, religion, dress code do not discord with any normal business environment. From this standpoint, Romania has a normal regime and is a SPECIAL location. In India though, the cast system comes through and appears in the business environment, young leaders are intimidated by elderly employees- because in the Indian culture, elderly people are treated with more respect and their decisions are respected. The decision making process is somewhat affected by the fear of not offending or coming in contradiction with the leader’s (from across the ocean) wishes and strategy. Any leader that wishes to transfer business in Bangalore India has to make great efforts so that the new local employees would successfully embrace the organizational culture of the company in such a way that the customers on the other part of the ocean would not sense any major differences in services. 

– As for the quality of the infrastructure, India has enormously invested in efficient business systems, networks, communications and processes and is a power in coordinating impressive volumes of business with a minimum downtime. From this standpoint, India is SPECIAL! Romania has a lot of work to do where this is concerned-  the informatisation of Romania and making the internal processes effective needs a more pragmatic and long-term tackling. 

– The education level of Romanian specialists (IT area, customer relations in multiple foreign languages) is acknowledged for its performance. We are SPECIAL now and maybe in the next 2-3 years because we still benefit from the level of knowledge of a generation that had the chance to study under an efficient not a superficial Romanian education system. An effort of improvement towards perfecting oneself, studying and self-development is needed in order to keep the flag flying where this area is concerned. There are good signs: more and more managers resort to training companies on specialized areas, company leaders conclude agreements with local universities for educational programs and growth of the future generations. India though is with a few steps ahead, besides the graduate and post graduate studies, more and more multinational companies use the method of studying towards perfecting Indian employees across the ocean so that they would become specialized, adapt to the Western culture and retain them (contractually or not) for a longer period of time. Thus, in the near future, India will be built on specialists educated in Western schools, trained in the business environment from across the ocean, an environment that will cultivate innovation and their entrepreneurial spirit. A great part of them return to India to open their own businesses or to work for other multinational companies. From the Romanians that have left the country, how many of them will return to build a new Romania?

 I have sometimes noticed, that as Romanians, we speak of India with certain superiority, a fact that I try to understand. „We are not Indians” we say with a characteristic Romanian pride- it is true, we are not, maybe we are more talented & more creative. We should learn something from all this history: today we are happy that we have an increasing level of investments in outsourcing, for Bucharest employees more and more offers appear and each of them attractive, the employees’ benefits are more and more diverse in the battle for rare skills- we believe that Bucharest has become the heaven of outsourcing and believe that we have been blessed.  

How long do you think it will take until the story of Dublin and Prague repeats? How long do you think it will take until others will put their finger on a far away land but more „cost effective” and will erase Romania from the map of „marvelous” destinations? How long do you think it will take until we exhaust the last resources in the local battle for competent resources that are in the danger of becoming extinct? As employees, for how long do you think we will fly from one job to the other chasing higher salaries without having the necessary time to add learning experiences to the luggage that we carry around to the others because they offer more? 

We are fine now, but Romania needs a long term strategy one in which the educational system must be combined with the real needs of the business environment in which the political environment must sustain foreign investments, through attractive policies. We need more mentors for our graduated youth who find themselves in certain jobs just because it happened for them to find it, a career does not necessarily mean a higher salary- it stands for what you can do anywhere on the world map and in any conditions.

Please check Romanian version below. 

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Comentarii (16)

  1. Amalia Sterescu spune:

    Vinod Pardesi wrote:
    A wonderful analysis Amalia. Romanians are not Indians and vice versa. Since change is the only constant, its imperative not just for Romania but also for India as it is for all countries to look deeper and analylize what happens when cost effectiveness stops to be a value proposition. Cost is only a small segment of value. Offerings will have to become value dominated rather than cost dominated. As far as Romania goes, no country can take away its geographic advantage. Everything else is subject to change. Its entry into the EU and the planned inclusion in the Shengen zone will only enhance Romania’s value. But these values are like uncut diamonds. Unless polished in just the right way, they would not entice investors forever. I am waiting for any country’s leader who can run it on Andrew Grove’s „Only the paranoid survive” principle.

  2. Manoj Gautam spune:

    Well, I will just like to take the discussion further and analyze the things in details,

    For starters, Romanian accent is as bad as Indian, however, since Romanian and English are written in same script, Romania will always have an advantage here. The educational institutes in India are known to produce great talents and some of them are often compared to MITs and Harvard of US, however, in Romania we only have one Academy of Economic Studies, which is grossly inefficient, drop out rates are higher and quality is ok. If you talk about Indians coming to Romania for Medical Studies, they come as they can not get through the tough entrance exams of State run medical institutes in India.
    However, one place where Romania scores is the cultural similarities with the client countries. India is still bogged down by many problems which will take centuries to solve. Also Romania is a safer proposition. But I can also see the rampant corruption in Romania which can pose a challenge and negative growth rate in the population. India has a workable population which is only matched by China and as such the labour market will always be a buyers market which will make India attractive to knowledge worker based outsourcing contracts vis a vis Romania.

  3. Cristina spune:

    Actually the Romanian accent is nowhere near the Indian accent. The language Romanian is a Latin language which is a romance language and sounds beautiful whereas, Indian is not Latin nor is it a romance language.

    • Amalia Sterescu spune:

      When we discuss about non native English speakers it is obvious that Indian accent is stronger this is why many companies including Oracle are very careful in selecting the best candidates which can offer a good customer service in English. Romanians are having the huge advantage of speaking a good English without a strong local accent and besides that, young Romanians are famous for speaking more than 2 foreign languages. Only in Bucharest there are service centers which handle customers in ~ 24 different languages and the quality of service and language treatment cannot be compared with other locations – here we still have an advantage.

      • Anton Dsilva spune:

        Interesting. I haev worked with Oracle India for seven years and I know the number of Oracle support engineers who work in India (Definetely more than the entire europe put together)

    • Jaideep spune:

      I agree with you on the first, which is that Romanian is a sweet language. But i would like to correct you on the second. Firstly , there is no language called’ Indian’. India has scores of languages, and we have English speakers from all those areas where all these different languages are spoke. Secondly, while none of the Indian languages are of Latin origin, that is no pre condition for a language being sweet.
      Finally, I haven’t heard many Romanian English speakers,but the one I have, is really great.

  4. Cristina spune:

    I don’t see why Romania has to be at fault for having gypsies in their country when gypsies exist in A LOT of other Countries, not just Romania.
    People just need a country to blame and they want to kick us while were down and struggling from having a former Communist leader.

    • Amalia Sterescu spune:

      Even if your last comment is not related to my blog main theme, in my opinion, the issue of migration in Europe it is a community issue and unfortunately it seems that for the moment the EU political class approach is to pass the problem from a border to another. I do not agree with France and Italy approach, on the other hand our political class is not doing too much for its poor and non educated categories like this ones.So is not about who to blame more, is about the fact that the EU constitutional right for free circulation is not respected here and also is about lack of political measures inside our own country for this category.Just a personal view.
      All the best,

      • Jaideep spune:

        A nice analysis of the problem Amalia.I really wish for Romania to rise about these minor irritants and grow as a nation. You have all the pre requisites for it, now , its just a matter of political will, and the ability to believe in yourself as a people, much like the Germans.

  5. Amalia Sterescu spune:

    Thank you.

  6. Amalia Sterescu spune:

    My first option was to encourage everyone to express their opinions on my blog without restricting any ideas. Looking behind I think you are right and I respected your advice.

  7. Sanskar spune:

    It is true that Romanian’s are professional in more than 2 languages that is one of the great thing, thanks to EU and great cooperation between various European countries. India is world’s second largest English speaking country. Indians also knows more than two languages but they are local so not of much importance. Everything in India like websites, news, official work, lectures, research, business is done in English.

    Accent is though a issue but not much talked about these days. For the starters as one of the person wrote above, accent in Romania is as bad. I have met many, talked to many, even if they are from Bucharest or Ploesti, it is not impressive, it is as Ok as Indian. And I dont have good experience with the English skills of the people of Brasov. Ofcourse I dont believe in generalizing the situation if I met only 10-15 people. Pure IT is not call centres or BPO job, so accent is not a problem.

    Talking about IT, in India we dont consider it as great as it is considered in Romania. It is the best job and for some it is the dream job in Romania. In India an engineer seeks it as a last option. The number of jobs offered by these companies are so high that you do graduation in any field whether it is chemical or civil or computers, one IT job is guaranteed. I am a Mechanical Engineer and I have 5 IT job offers with me and I am choosing none..

    In India below average to average people work in IT companies whereas quality workforce is working in R&D sectors of probably the same companies. Many companies have opened their research labs in India Symantec, Intel, Microsoft, Cisco etc which are much high paying and respected jobs in India, If we talk only about IT-computers.

    If we talk about the Education Institutes, I haven’t heard any other college except Academia de Studii Economice din Bucuresti. It is no doubt one of the best institute in Romania, but I haven’t seen people taking or studying high degree course like MBA or PGDMA, instead people take diploma in some course and come out. India is one of the largest producer of class I type professionals Doctors (MBBS, MD, PhD), Engineers (B.E, B.Tech, M. Tech, MS) Economists (MBA) who undergo worldwide accepted degree courses which becomes a permanent title against your name, (Dr., Er., etc.) and not just a diploma course

    Indian IT sector is today less dependent on foreign projects due to an increase in high budget national projects like rural development and space exploration.

    Government procedures are though very slow, you are right about this. But it is changing slowly, and it will still take a lot of time for them to improve. But a progress rate of 8+ and being world’s 10th largest economy (which is ahead of all European Countries except, Germany, France, UK and Italy), India is still a favourite place for Business and IT better than china due to transparent and democratic government which is friendly to west, Russia, as well as to east.

  8. Ganesh spune:

    I am a Canadian of Indian origin and am looking at up and coming IT markets especially for same time-zone service delivery.While I looked at Costa Rica, the size of the labor pool was a risk. I did not read all the comments, but I see that there is a tremendous opportunity to collaborate. After all there is a lot more room for the outsourcing market to grow.

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