The Sri Lankan Government has offered Australian companies and Government departments a tax holiday of up to twelve years if they choose the war-torn country for IT and business process outsourcing.

Recovering from a 25-year civil war between the dominant Sinhalese and separatist Tamil movement that ended dramatically in 2009, the Sri Lankan Government has pulled out all the stops to boost employment and the country’s economy.

Foreign ownership laws have been relaxed across several key verticals in a bid to attract Western investment that might otherwise flow to India or China.

The Information and Communication Technology Agency of Sri Lanka has offered Australian companies setting up IT or BPO outsourcing “no restrictions on repatriation earnings” – a principle the agency says is enshrined in Sri Lanka’s constitution.

It has also lowered corporate tax rates from 35 to 28 percent, comparable to Australia’s company tax rate of 30 percent.

Under a new scheme proposed for the IT and BPO industries, businesses can be exempted from tax for up to twelve years when they commit to employing a large number of Sri Lankan workers.

The Information and Communication Technology Agency of Sri Lanka has funded a delegation representing 15 Sri Lankan ICT companies to visit Sydney and Melbourne for a series of events, including the CeBIT conference next week in Sydney.

Agency chief executive Reshan Dewapura said the small nation expects its IT industry to be a billion dollar export powerhouse employing 100,000 within five years.

“We are excited to extend a warm invitation to Australian companies to realise the significant opportunities that exist here, including generous tax holidays,” he said.

Adelaide-based CAM Management Solutions (CAMMS), a provider of Business Intelligence software and consulting, set up a Global Service Provisioning Centre in Sri Lanka three years ago, just prior to the end of the civil war.

The company employs over 100 staff in the facility to fulfil contracts for the likes of the South Australian and Northern Territory governments.

According to Joe Collins, managing director at CAMMS, it wasn’t tax sweeteners that piqued his interest in the region.

The company struggled to find the skills at home required to keep up with its plans for growth.

Investing in the facility amid the closing stages of the civil war, Collins saw “a country with huge potential, using resources in a non-productive way.

“It’s a much more relaxed place now,” he said. “Now that the Government no longer needs to focus [on] war, it’s naturally more amenable to business. It has better priorities than buying bullets.

“We saw Sri Lanka as the next big opportunity to support our growth – and it was exactly half way between our offices in Australia and the UK. Our company was growing very rapidly, and we were struggling to find the right people to keep up our R&D needs in Australia while supporting the needs of our customers.”

Collins developed a business relationship with a Sri Lankan investment agent to facilitate recruitment and the establishment of the centre.

“We considered the outsourcing or joint venture approach,” he said, “but in the end we decided to establish a company there.”

Rather than “outsource the hack work”, Collins wanted the service centre to work hand-in-hand with employees in Australia and the UK.

“We are very open and proud of our service centre,” he said. “We wanted the Global Service Delivery Centre to be an extension of us, to work jointly on projects. The company policy is to up-skill staff at the centre, to disseminate our corporate knowledge.”

During the past three years, CAMMS’ Sri Lankan scope has grown from R&D to 24-hour helpdesk, eTraining, marketing and product development around such complex areas as business intelligence and knowledge management.

“If you keep at it, the same rules apply as at home – you just need good staff and you need strong leaders,” Collins said.

Collins said the Sri Lankan office has shortened CAMMS’ cycle of product development, improved its responsiveness and ability to scale and raised the standard of its customer service.

“It allows our Australian staff to focus on the core business of selling products and providing high level support to our Australian clients.”

The only challenge, Collins said, is that Sri Lankan Government initiatives are getting noticed by some very large multinationals. Already, sweeteners have attracted investment from the likes of Microsoft, Motorola, SAS and Nokia.

“When big American companies come in and set-up 1000-man offices, there will be more demand for staff,” he said.

But he has no regrets.

“We were lucky, in some respects, that we got in early. I’d say I still would have done it without any tax agreements. It’s cost-effective, and it solved a problem we had around the availability of skilled people, and how to keep them.

Source:http://www.itnews.com.au/News/258433,sri-lanka-offers-tax-holiday-for-it-outsourcing.aspx/1

Following the announcement of proposed changes earlier this year and a period of exclusive discussions with Retail Assist, the multi-brand Aurora Fashions group can now confirm that it has outsourced its IT functions to the retail-only solutions and IT managed services provider. Some 48 Aurora employees have joined Retail Assist. All will continue to work from their current offices in London and Oxfordshire.

Explains Retail Assist’s co-founder and managing director, Alan Morris: “In one form or another, we’ve worked with Aurora for 9 years. We originally worked with the Warehouse and Principles brands, then with Mosaic Fashions. When the businesses emerged as Aurora Fashions, we continued and built upon our existing relationship.”

When, as part of its corporate strategy, Aurora looked to outsource infrastructure services including IT, the company invited Retail Assist to put forward a proposal detailing how they could move from services supplier to manage Aurora’s entire IT operation. Retail Assist was successful in reaching an agreement in a competitive scenario.

Alan Morris observes: “The values and culture of Aurora Fashions are very similar to ours, which is one of the most crucial factors in these situations. We saw this as an opportunity to upscale our Managed Services Division. With Aurora’s international, multicurrency and multichannel growth strategy, the developments provide us with further skill sets and experience that equip us to engage with more retailers in a time when every retailer is looking to exploit these opportunities.”

For both Aurora and Retail Assist, it will be ‘business as usual’. The transition of Aurora employees has now been completed. The contract will allow Aurora’s brand-focused operational units to concentrate on customer service and business growth, and previous
Aurora employees can look forward to future opportunities for career progression within a larger IT team.

Richard Glanville, Chief Financial Officer of Aurora Fashions commented: “This new structure, which has been achieved without any job losses, is very much about growth. We saw that Retail Assist were the ideal partner for the expansion required, an excellent fit for our staff, and a move that would allow our brands to focus on satisfying the needs of their customers.”

For Aurora, the new arrangements will preserve the shared services benefits of cost-effectiveness, access to expertise and ‘best practice’ IT solutions, providing the group with a strong foundation for future growth.

Source:http://www.prlog.org/11505042-business-as-usual-as-aurora-fashions-group-confirms-it-outsourcing-to-retail-assist.html