Lodz of outsourcing appeal: HP heads to Poland's third city

The city of Lodz may not be an obvious BPO hotspot, but both HP and Infosys are among the companies establishing service centres there

The service sector in Poland keeps on growing.

HP recently announced it is to open a new service center in the Polish city of Lodz, making it the company's third in the country.

The centre will focus on business process outsourcing (BPO) services in finance and accounting, CRM, HR, and payroll for clients worldwide, the company announced. Due to be opened somewhere in the third quarter of the year, the centre will be starting off with a couple of hundred of staff.

As well as HP, Lodz also plays home to Indian outsourcing giant Infosys: its  current Lodz facilities are getting cramped, prompting the company to move to a new office building in the city to house its 1000 local employees.

While gradually recovering from the decline of the textile industry, the city - Poland's third largest behind Warsaw and Krakow - still has an unemployment rate of 11 percent.

The 'Manchester of Poland' has some elements in its favour, however. To start with, it's located in the middle of the country, only 130 kilometers from Warsaw, while the recent opening of the A2 motorway to the capital has slashed projected travelling times. Education too is a bonus for the city: Lodz is home to both a university and a technical university, both of which have good reputations.

Poland is the largest outsourcing player in Europe with an estimated 500 offshore outsourcing centers within its borders

Nonetheless, despite adding Infosys and HP to outsourcing operations in the city, Lodz is not considered among the countries outsourcing hotspots, according to analyst Gartner.

"Warsaw, Wroclaw, Krakow, Katowice, Gdansk and several other cities, including Poznan, Bydgoszcz and Lublin, are viable locations for IT or business process work, due to the availability of skills," it said in a recent report, describing Poland as "a preferred destination for the business process outsourcing and knowledge process outsourcing sectors."

HP is bulking up its presence in other Polish cities too, however: its Wroclaw Business Center, which was opened in 2005, is expanding. "We are planning to open new positions that will be servicing financial and marketing projects, including knowledge process outsourcing," Agnieszka Orlowska, its director said. "So that means we will be hiring new staff who speak foreign languages, experienced consultants and project managers, and market analysts."

Like others, HP has chosen to spread its service centres across a number of destinations within Poland.

"Some [of the country's] BPO centers are among the longest established in Central and Eastern Europe," Gartner notes. "Many service providers and user organisations have set up delivery centers across a broad range of locations in Poland; bringing improved skills, as well as management and process maturity."