11 May 5 Reasons Why Vietnam is an emerging contender for promising engineering talent
In my last company, I worked closely with our offshore engineering team located in Ho Chi Minh City (HCMC), Vietnam. I was a Product Manager for a public multi-national UK-based enterprise, and I was responsible for defining and delivering the company’s social analytics suite of products.
Having spent about 2 years collaborating very closely with the development team in HCMC, I became increasingly optimistic on Vietnam’s promising potential as a serious and emerging contender for that talent.
As a matter of fact, in its recent 2015 report on leading offshore services locations in Asia/Pacific, Gartner placed Vietnam as a Tier 1 emerging market location. It’s no surprise therefore that I found my foray into the world of tech entrepreneurship, co-founding TenPoint7, a data services company, with Vietnam at the center of its delivery model.
From my first hand experiences, Vietnam has all the primary reasons working for itself that would make it an attractive destination for talent sourcing and offshore service delivery: increasing levels of service quality, cost attractiveness, scalability
and improving legal business environment.
To put things in perspective, here are my top 5 reasons, based on personal observations and experiences, which keep me optimistic about this country’s potential.
1) Talent & Labor Pool
At my ex-company, work between the onshore (US) & Vietnam development teams were divided primarily based on skill sets. During my tenure, I noticed the gradual vote of confidence placed in the Vietnam team as the nature of projects assigned to them gradually increased in sophistication. The team was responsible for maintenance of our legacy products and then eventually started work on implementing the rollout of our Big Data product infrastructure. Expect to find a good cadre of engineers with traditional relational database skills here along with web front-end development expertise. With a strong focus on computer science curriculum at universities and recent arrivals of big tech companies like Microsoft, Samsung and Intel here, we can expect the volume and quality of this labor pool to accelerate rapidly over the next few years.
2) Loyalty & Attrition
Loyalty is highly prized in Vietnam. In my numerous travels to Vietnam for leisure and business, I’ve consistently been impressed with the levels of service and attitude that greets foreigners and locals alike. The same holds true even in the professional world. Its no surprise then that attrition levels in Vietnam are generally significantly lower than other development destinations like India. In my experience, those rates hovered around 10 percent – yes, certainly a very acceptable rate.
3) Company & Culture Compatibility
Per 2014 data, Vietnam’s median age was close to 30 years. With total population around 93 million, suffice to say that’s a significant pool of young workforce. Like anywhere else, it’s therefore critical to entice & retain such a workforce with a fun
and rewarding culture.
For example, we ensured global executive staff would visit the Vietnam team frequently and local management ensured frequent social outings were planned for the team (potlucks, team dinners, parties, and more). An open door policy, clear career trajectory and office layout also helped reinforce this culture and made it clear to the team that culture wasn’t just all about paying lip service only.
4) Language & Communication
Some studies point out that Vietnam’s English proficiency index is better than other Asian & Latin American countries. While English is taught at schools here, there can however be a significant variance in English speaking skills within the workforce. The key to ensuring that trickle down communication does not become a hindrance, it is critical to hire local managerial staff with adequate bi-lingual skills that can effectively translate for the team (as needed) and motivate them. With a growing pool of English speaking talent and recognition that language proficiency is key to one’s career success, language should soon not be a major recruiting headache.
5) Cost of Talent
With an increasing supply of engineering graduates and being a lesser-known offshoring destination currently, Vietnam’s cost of talent provides a hard-to-ignore cost to value proposition compared to other much well established (and pricier) destinations like India, China and parts of Eastern Europe. Even when factoring in benefits and other associated costs, the loaded cost of talent acquisition and retention is extremely attractive. That said, with recent big investments by tech heavyweights such as Intel & Samsung here, some estimates are indicating a strain on the supply of this skilled workforce. Translation: expect pressure to build on the first mover cost advantage cost in the near future.
Shane Rai (Co-Founder, shane@TenPoint7.com)