Vietnam as an emerging destination for offshore outsourcing of software development for finnish companies: A conceptual perspective

Companies are constantly under pressure to produce software products more efficiently and within tight budgets. Offshore outsourcing has been seen as one solution to the dilemma, and lucrative outsourcing businesses have evolved in many countries, such as India, China and Russia. Vietnam is now emerging within this global outsourcing sector. This study investigates Vietnam as an offshore outsourcing destination for Finnish companies for developing their software products and related services. The research was undertaken by reviewing the literature of a) offshore outsourcing, b) offshore software production, c) information technology industry in developing countries, especially in Vietnam and d) approaches for outsourcing to developing countries and to Vietnam. A conceptual model of software development through offshore outsourcing was developed. The study found impending challenges as well as potential in the Vietnamese software outsourcing industry. In addition, it provides valuable information for practitioners interested in outsourcing to Vietnam and for further research within the area.