Nearshore SAP Application Management Still Developing in Eastern Europe

Compared to other segments, SAP application management remains very limited in Eastern Europe. Although the labor cost difference and the language skills sets would favor SAP application management from Eastern Europe to Western European, the model is quite limited thus far.

By contrast, non-packaged application development and technical application development have been fairing very well, accounting for the great bulk of the nearshore application management/application development in Eastern Europe. One key reason for this situation is the still nascent SAP market (and packaged software in general) in Eastern Europe. SAP skills remain fairly scarce and these are easily absorbed by the local demand at high rates.

Compared to India which has developed strong SAP application management delivery capabilities, Eastern Europe is not likely to see in the medium term a strong uptake in this market. Nevertheless, as the economic crisis becomes increasingly clear in Eastern Europe too, and local demand may shrink step-by-step, application management may arise as a leverage option for well positioned IT services providers.

PAC has just released new SAP Application Manegement figures, go to www.pac-online.com/sap to check it out!