01 September 2008 | Paul Snell
Scotland could become a hub for knowledge and business process outsourcing, but needs a co-ordinated approach from politicians and business to make it happen.
A proposal drawn up by Andrew Rigby, a partner at law firm Brodies, said the country was well placed to take advantage of current global conditions, but needs to have a radical and collaborative approach.
The global outsourcing market is expected to be worth around $323 billion (£176 billion) by 2011. The UK's current share is small - it is 42nd in the Global Services Location Index. But Singapore, which has a similar population to Scotland, is in 11th place.
As Scotland cannot compete with low-cost locations, it should take advantage of the boom in knowledge process outsourcing, which is based on adding value rather than cost reduction, said Rigby.
"The proposal is looking at high-end, up-the-value-chain outsourcing. Most research has come to the conclusion that at the high end it is not so much a question of cost, but quality." He added these services are often already outsourced elsewhere in the UK.
He suggested that cities such as Edinburgh (above) and Glasgow could provide good locations for services.