softtekMexican software and IT service firm Softtek sees growing business opportunities in Latin America for IT support and maintenance, the firm’s South America and Caribbean CEO, Francisco Lara told BNamericas.

Softtek – which offers a range of IT services including business process management (BPM), software implementations, and business intelligence – has singled out support and maintenance because of how the global economic crisis is shaping customer needs.

“Now with the crisis, we have had to say to ourselves ‘what exactly are we expecting the market to buy,’” he said. “We have moved more towards application support and maintenance services because they give clients the opportunities to reduce costs.”

“INDIAN IT FIRMS ARE HERE, BUT THEY’RE NOT HERE”

Lara said Softtek is also working to position itself as a global nearshore service provider. He explained that the firm serves the US from its Mexico offices and South American firms from its Brazilian and Argentine facilities, adding that Softtek provides similar services in Asia and Europe from offices located in those regions.

As Softtek extends its coverage around Latin America and the rest of the world, the company has increasingly been competing with Indian IT firms. Within Latin America, Indian IT firms most often set up operations in Mexico and Brazil, the executive said.

Lara said that the arrival of such companies is forcing existing IT service providers to become more competitive. Still, he insisted that Indian firms lag behind in certain business areas.

“They [Indian IT firms] are here, but they’re not here,” he said. “They need to learn to provide nearshore services from Mexico, Brazil and Argentina for the rest of the world, and also understand Latin American culture.”

FORECAST: 10% LATIN AMERICA REVENUE GROWTH

Globally, Softtek billed US$270mn last year. Sales in Latin America reached just under US$160mn, which represented 59% of the firm’s global operations.

Lara said Latin American sales were driven by nearshore services in Mexico, as well as consulting services for SAP implementation and BPM in South America. He said 80% of regional sales came through services, while the remaining 20% came through product distribution, maintenance and third-party product positioning.

Softtek saw strong business in the oil and gas, government and utilities sectors.

The firm expects Latin American revenues to increase 10% this year. Softtek described the revenue projection as “conservative” and attributed the firm’s cautiousness to the strong US dollar and economic uncertainty.

Source: www.bnamericas.com