Research Proposal:

University: EAFIT, Medellín – Colombia

Course: MIB (Master of international business)
Emphasis: Internationalization of software firms
Candidate: Alexander Zehnder, CE 306549, Code 201110014165
Date: November 2010
Topic Export guide for Colombian Software Firms to EFTA States SME
This investigation aims to build a feasible guide for Colombian Software Firms on how to
enter EFTA States ITO market on custom Software Development for SME. It shall show the
potential for Colombian Software industry in particularly the EFTA States, the risks,
obstacles and suggestions how to overcome them. Therefore the following questions are
going to be addressed:
- What is the current potential for Colombian Software companies providing
development services for SME of the EFTA?
- Where are the main barriers for Colombian-EFTA cooperation?
- Which is the recommendable approach to enter this market?
- How to identify Software Companies that have potential?
- How to classify the risk and feasibility of contracts?
- What organizations, Clusters and companies exist to assist and monitor the
process?
Background
In the last years Colombia has been stabilized not only in political but also in business
matters. One of the Governmental initiatives is to be recognized as worldwide ICT-Provider
and therefore big efforts have been initiated by Proexport and other institutions to become
more competitive and gain visibility in this sector. On the other hand Europe as well as USA
is suffering an uncovered demand on qualified workforce in several industrial sectors, one
of them the ICT Sector. For example, the forecast of missing ITC Specialists in Switzerland
will be around 32.000 by the year 2017 (Vogt, 2010).
Whilst for EU and USA the most visible and obvious ITO/BPO Countries are India, Russia
and Rumania, Colombia is still not on that list. The effort for Colombian Software Clusters
and Firms to compete against those countries seems to be tremendous as the have years
of development as advantage. Therefore it might be recommendable to find niche Markets
which have not been covered neither considered by common ITO/BPO Countries. This
means to find opportunities of high value but out of scope by usual market studies, a truly
difficult and ambitious task.
In Export it is more about trust, fame and experiences than pricing. Therefore it is important
to make visible the current achievements of Colombia, its Clusters and companies such as:
- Colombia: the most “business-friendly” country in Latin America
(Top Reformers Report, 2010)
- Colombia: the highest investor protection of Latin America
(Doing Business, 2010)
Just like the Governmental initiatives, the universities of Colombia and Switzerland have
started to recognize the high potential of close cooperation. For example EAFIT (University
in Medellín - Colombia) and HSG (University of St.Gallen – Switzerland) have already done
several Student exchanges and this can build a strong academic base for this research as
well.
Scope
Different of many already existing researches and studies, the scope of this investigation is
all about Colombian Software Firms providing development services for EFTA SME. The
EFTA SME do not have experiences neither preferences in ITO so far and are a nearly
untouched market for ITO. The point is that Colombian Software Firms are usually not
considering opportunities in EFTA States (Switzerland, Lichtenstein, Norway and Iceland).
This is probable due to the language barrier and the unawareness of the Free Trade
Agreement between Colombia and the EFTA States signed November 25th 2008 (EFTA,
2008). On the other hand EFTA SME do usually not consider to do ITO at all and less with
Colombian Software Companies. Therefore the Scope of this research is bound to this very
particular market needs from EFTA SME and the opportunity for Colombian Software Firms
to hit this market first whilst the big, recognized ITO/BPO Countries focus on big EU/US-
Enterprises.
Method
 Study online literature and business researches related on ITO of the EFTA as well
as initiatives and potential analysis from Colombian Software Firms.
 Search success stories of Colombian Software export and failed initiatives/projects.
 Interview Cluster Managers on Colombian as well as on EFTA side.
 Interview managers in charge of ITO in the Chamber of Commerce, Proexport,
Sippo, OSEC, SECO, CBI, Ministry of foreign affairs
 Construct a guideline for Colombian Software Firms which helps to obtain the
highest possible rate of success including
o Software Export Process suggestion
o SWOT(Strength, Weakness, Opportunities and Thread analysis),
o Planning: EMP (Export Marketing Plan), Budget, Roadmap and ROI
 Networking
o Provide the crucial people network and tools to provide a fluent process
communication
 Recommendations and prove of concept by demonstration of a Pilot Project using
the elaborated guideline.
Impact
The result of this investigation is meant to be a guideline for Colombian Software
Companies that want to approach new markets abroad and to make successful export of
their development services. This will help not only Colombia to become an important
partner in the ICT-Sector for the EFTA States but also help the EFTA States to cover the
increasing needs of Software Developments at SME level to reasonable prices.
Bibliography
Doing Business, W. B. (2010). Strength of Investor Protection (183 Country research).
Bogotá: Proexport.
EFTA, S. (2008, 11 25). Colombian-European Free Trade Association (EFTA). Retrieved 11
21, 2010, from Foreign Trade Information System:
http://www.sice.oas.org/TPD/COL_EFTA/Negotiations/sign_e.pdf
Top Reformers Report, W. B. (2010). Positive figures show improvements in business
environment. Bern: OSEC.
Vogt, R. (2010, 11 16). Zehntausende ICT-Profis fehlen. Retrieved 11 16, 2010, from
Computerworld.ch: http://www.computerworld.ch/aktuell/news/52880/index.html