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Why Lebanon Is Well Positioned For Premium Tech Outsourcing Services

Outsourcing

Why Lebanon Is Well Positioned For Premium Tech Outsourcing Services

As part of a roundtable and matchmaking event titled ‘Leveraging Lebanon for Outsourcing in the US’, hosted by the US Embassy of Lebanon in Washington DC on July 27 in collaboration with the International Trade Council, LebNet, Global Lebanese Investors, and the Asher Center for Innovation & Entrepreneurship – ACIE, Wissam Youssef, CME CEO, answers a key question about what makes outsourcing successful from Lebanon.

Wissam Youssef, you started your outsourcing business in Lebanon many years ago. You went through many challenges, but these didn’t really stop you from growing. So, tell us what is the business formula, the DNA, and the model that you have adopted to remain resilient, especially in today’s times? How do you sustain your business and how do you shelter your clients from these challenges? Tell us also about the community of the outsourcing services providers in Lebanon, and the tech services they are ready to deliver.

Let me start with the last part, the outsourcing ecosystem in Lebanon. It goes back to the talents matter. Today, almost everyone believes that Lebanon is on the bottom of all kinds of rankings. Whether it’s on the infrastructure risk, corruption, etc., all kinds of rankings, except on one thing. The HUMAN CAPITAL INDICATOR. According to a report by The World Economic Forum in 2019, Lebanon ranks among the top 25 countries in the world when it comes to digital skills and the ability of skilled employees. We rank in 4th place in Math and Science education. This is the core competency when it comes to building technology and software development. So, the potential is huge in Lebanon. Today, we’re relatively small in the outsourcing industry. If you compare Lebanon to other outsourcing destinations, we’re really small. The whole industry in Lebanon, I mean the employees that work for outsourcing, don’t amount to more than 5000 people. But with a huge potential! Especially with the lack of resources globally. Now if we tap into the specific area where we as talents in Lebanon are able to compete and win, we’re better positioned in what we call the premium outsourcing services segment; in other words, I’m talking about the enterprise grade application services such as healthcare solutions, energy solutions, fintech, insurance, banking, market research and all the industries that require domain knowledge as much as technical expertise. This is the best position for Lebanese companies to compete and this is how we’ve been able to build our track record for the past 17 years.

Lebanon is better positioned to provide premium outsourcing services; in other words, enterprise grade application services that require domain knowledge and technical expertise.

The main competitive advantage of the Lebanese outsourcing ecosystem goes back to 2 main reasons: first one is the multidisciplinary workforce, and the second is the fact that people in Lebanon are problem solvers by nature. The problems that we’re suffering from today (and by no means am I undermining what we’re struggling with), we’ve been going through them (at a different scale of course) for the past 30 years, so it’s not something new to us. And we’ve been solving these problems on our own. If you take the electricity problem for instance, most of the companies in Lebanon have 3 or 4 backup generators. Our teams have acquired problem-solving skills through their entire career in Lebanon, not just by delivering work but as part their daily life. So, this is an important aspect when it comes to technology and specifically to compete in the premium outsourcing services segment.

Lebanon benefits from a multidisciplinary workforce, talented at problem solving by nature.

Now why would anyone outsource in Lebanon? Today the whole world is looking for resources when it comes to software development and technology. It’s a huge deal, especially after it was accelerated during the pandemic. The Nordic countries are in need of hundreds of thousands of engineers. In the US, Amazon alone needs thousands of engineers, and they are even hiring from Lebanon. Companies are ready to hire anywhere in the world, remotely, all they need to operate is a laptop, internet, and power, and that’s it. I would actually worry about intellectual property and regulatory compliance much more than the infrastructure risk. And this is exactly what we, as Lebanese, especially large companies, are capable of offering. Because most of the large Lebanese companies have local offices that provide peace of mind for customers, or at least the same legal framework as operating in the US or other countries or markets in the world. Delivering the same legal framework would be much easier to work with and deal with customers, whether on the intellectual property side or on the compliance and regulation side. So, this is, I think, the real risk today in our industry, not just the infrastructure.

Lebanese companies have offices in different countries that provide the same legal framework for local clients, which is crucial when it comes to intellectual property, compliance and regulation.

Now, as for the first part of the question you asked regarding the resilience, I would split it into two categories: we have what I call the industry resilience and the in-country resilience.

Our industry is by nature disruptive and most of the companies, not just Lebanese companies, are being disrupted every single day by other companies, new startups, new technologies, new concepts…This is the nature of this industry. So, to be resilient in this industry and survive, first, our strategy is to diversify; we diversified in our industries, we have expertise in more than 10 different industries. We diversified in our technologies, we’re one of the rare companies in the world that delivers hardware and software solutions, in-house, and by hardware, I mean IoT, smart devices. Last, the geography diversification, we recognized its importance during the pandemic. So, with the 3 elements of diversification, this would allow us to mitigate all the risk that comes from any disruption in this area. Second element in our strategy is continuously gaining domain expertise. As I mentioned previously, our services main strength in the segment that we compete in is not coding, it’s more about domain expertise, domain knowledge. That’s why we always invest time and effort in acquiring domain knowledge to serve our customers better. The third element is to continuously avoid complacency and reimagining or reinventing the company by introducing new programs, new products every year or every couple of years.

As for the country resilience, there is one element that I would say is the core of our motivation. It’s the community benefits. The reason why we started CME in Lebanon 17 years ago, goes back to the fact that we did not want to leave our country, and we believe that technology is one of the tools that would enable talents in Lebanon to stay in their country and at the same time, build a sustainable economy, and to export to the whole world. This is the model we believe in, and we still believe that this is the golden formula for Lebanon.

Technology is one of the tools retaining talents in Lebanon and at the same time, helping build a sustainable economy, exportable to the whole world.

So, the community benefits are behind our motivation, that’s the main reason why we are ready to mitigate all kinds of risks today, in Lebanon, so we can hire more resources in our country, because this is our belief. It goes far beyond a mission or a corporate objective, this is the real DNA for a company like CME. And I’m sure that this is one of the main motivations for companies based in Lebanon, it’s the community benefits.

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