Honda UK turns to Vietnam for new human resources systems

Honda UK is to develop a major software project in Vietnam.

Honda UK is to develop a major software project in Vietnam.

The motor manufacturer's decision to develop a new staff training and personnel system overseas was driven by the low labour costs and strong IT skills of the Vietnamese workforce. The new system will help Honda meet its target of providing 12,000 annual man-days of technical and commercial training for staff every year.

Honda's learning management system will be managed in the UK, with software development and testing carried out by consultancy Harvey Nash in Vietnam.

A growing number of UK companies, including supermarket chain Somerfield, are moving their software development offshore in a bid to reduce costs by using cheap, highly skilled labour in countries such as India.

Analyst firm Gartner has predicted the European market for offshore outsourcing will grow by more than 40% this year.

"Vietnam is quickly becoming a practical alternative to India in terms of its offshore software development capability," said Paul Smith, group marketing director at Harvey Nash. "It has a highly skilled workforce and capital development costs may be as little as 65% of development costs in the UK."

The web-based system will be written in Java code and will run on IBM's Websphere application server and Microsoft Windows Server 2000.

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