5 Benefits of Nearshoring Your SAP Application Management Services (AMS)

Reducing costs and creating competitive advantages – a never ending drive for greater efficiency at lower prices. For many companies, it is no longer economical to cover activities such as SAP AMS in-house. As a result, organizations typically rely on onshore or offshore support models. However, these are increasingly being challenged by a more balanced and strategic approach: nearshoring. Here are five tangible benefits of nearshoring your SAP AMS, particularly for companies in Europe and North America.

1. Time Zone Alignment and Real-Time Collaboration

One of the most significant drawbacks of traditional offshoring is the vast time zone difference. A 12-hour time gap can lead to communication delays, slow response times, and a frustrating lack of real-time collaboration. Nearshoring, by definition, involves partnering with a provider in a nearby country with a similar time zone. For businesses in Central Europe, a nearshore partner in Poland, Hungary, or Spain provides close proximity while saving costs, while businesses in the USA profit from partners in South America e.g. Brazil, unlocking seamless, real-time collaboration throughout the business day.

This alignment means that your internal IT team and your nearshore AMS provider can work together as a single, cohesive unit. Problems are solved faster, projects move forward more smoothly, and the overall efficiency of your SAP operations is significantly enhanced.

2. Cultural Proximity and Improved Communication

Beyond time zones, cultural alignment is a crucial factor in the success of any outsourcing partnership. Nearshore providers in regions like Central and Eastern Europe share similar business practices, work ethics, and communication styles with their Western European and North American counterparts. This cultural proximity minimizes misunderstandings, builds trust, and fosters a more collaborative and productive working relationship.

As stated by a study from the International Association of Outsourcing Professionals (IAOP), cultural compatibility is one of the top three reasons for successful outsourcing relationships. When your AMS provider understands the nuances of your business culture, they can provide more effective support and act as a true extension of your team.

3. Significant Cost Savings Without Sacrificing Quality

While cost reduction is a primary driver for outsourcing, the lowest price doesn't always equate to the best value. Nearshoring offers a compelling balance between cost savings and quality. While not as inexpensive as some offshore locations, nearshoring provides significant cost advantages over onshore support, often reducing operational costs by 30-50%.

This cost efficiency is achieved without the quality compromises often associated with offshoring. Nearshore locations in Europe, for example, boast a highly educated and skilled workforce, with a strong focus on technical expertise and professional certifications. You get access to top-tier SAP talent at a more competitive price point, resulting in a higher return on your AMS investment.

4. Access to a Deep Pool of Specialized SAP Talent

The demand for skilled SAP professionals is at an all-time high, and finding the right talent in your local market can be a significant challenge. Nearshoring opens up a vast new talent pool, giving you access to a deep bench of certified and experienced SAP consultants. Countries like Poland, the Czech Republic, and Romania have become hubs for IT and SAP expertise, with a strong educational focus on technology and engineering.

By partnering with a nearshore provider, you can tap into this specialized talent pool to support your entire SAP landscape, from core ERP to S/4HANA, custom code, and beyond. This access to expertise ensures that your SAP systems are managed by professionals who are up to date with the latest technologies and best practices.

5. Enhanced Compliance and Data Security

In an era of stringent data privacy regulations like the General Data Protection Regulation (GDPR), data security and compliance are non-negotiable. Nearshoring to a provider within the European Union ensures that your data is protected by the same high standards that apply to your own business. This eliminates the legal and compliance complexities associated with transferring data to offshore locations with different data protection laws.

Choosing a nearshore partner within the EU provides peace of mind, knowing that your sensitive SAP data is handled in a secure and compliant manner. This is a critical consideration for any business that values its data and its reputation.

The Bestshore Model: The Best of Both Worlds

At Lupus Consulting, we have refined the nearshoring model into what we call Bestshore. This approach combines a dedicated, point of contact with the time zone and cultural advantages of nearshoring, while also leveraging the cost benefits of a global delivery model. Our locations are not limited to Europe alone. Lupus operates globally, with support hubs in South America and a worldwide partner network. With more than 300 experts and over 20 years of experience, we deliver first-class SAP Application Management Services around the clock, every day.

Conclusion: A Strategic Move for Your SAP Landscape

Nearshoring your SAP Application Management Services is more than just a cost-cutting measure; it is a strategic decision that can lead to significant improvements in efficiency, quality, and collaboration. The tangible benefits of time zone alignment, cultural proximity, cost savings, access to talent, and enhanced compliance make nearshoring a compelling choice for any business looking to optimize its SAP operations. By choosing the right nearshore partner, you can transform your AMS from a simple support function into a strategic enabler of business growth.

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