Transnational Companies Establish Service Centers in Mexico
In recent years, Mexico has emerged as a strategic location for transnational companies seeking to establish service centers and logistical support hubs, serving as a central point of support for their headquarters and plants across the Americas.
This model reflects a shift in perception of Mexico as an investment destination, positioning it as a hub for qualified talent, diversifying foreign investment, and elevating the professional profile of the Mexican labor market.
Novartis: A Pioneer in the New Model
Novartis operates its Corporate Services Center (NOCCMxC) in Mexico City, one of six centers designed to provide high-quality solutions to its divisions and units worldwide. Initially offering financial services for Mexico, the center’s success led to expansion across Latin America. Today, NOCCMxC supports Canada and the United States with a wide range of services, including data, digital, IT, procurement, manufacturing automation, standardization, infrastructure, security and hygiene, and digital marketing. The center employs 1,100 of Novartis’s 1,500 Mexican staff, including engineers, chemists, doctors, psychologists, marketers, and professionals from bachelor’s to doctoral degrees. Although most are Mexican, the center also employs representatives from ten other nationalities.
Baxter: Another Notable Case
Baxter has established a technology innovation center in Guadalajara with 300 employees, providing TIC services to America, from Canada to Argentina. The center offers technical support and artificial intelligence services. Oscar Javier Pérez, Baxter’s General Manager in Mexico, describes this center as a “wonderful Silicon Valley” in Jalisco, where employees handle multiple languages and bring an innovative approach. Initially focused on supporting renal damage solutions, the center split into two after Baxter’s division: one for Baxter and another for Vantive, led by Larry Vasco in Mexico.
Baxter also has centers in Bangladesh (Asia) and Warsaw (Poland) to serve other markets. In Mexico’s service center, executives highlight a unique environment, free from traditional corporatism, with technical profiles such as engineers, programmers, and computer geniuses from states like Chiapas, Veracruz, or Mexico’s north. These employees, mostly Mexican (with only 5% foreigners), work in casual attire and often remotely, reflecting a modern, specialized labor culture.
Bayer and Its International Logistics Center
Bayer, in its strengthened Lerma plant with 650 employees, began forming a specialized logistics team to support operations in the United States, with plans to expand southward. This team aims to improve efficiency in other headquarters by leveraging local talent.
All three companies praise the Mexican workforce’s competencies, highlighting their versatility in IT, human resources, finance, and marketing. Bayer executives have noted that unlike in the United States, where they couldn’t find the necessary expertise for a specialized logistics site, Mexico offers professionals with deep industrial knowledge, ideal for supporting regional operations. Novartis, for example, has successfully replicated marketing strategies developed in Mexico in other markets, solidifying the relevance of local talent.
Key Questions and Answers
- What is the new model for transnational companies in Mexico? The new model involves transnational companies establishing service centers in Mexico, focusing on highly skilled and well-compensated personnel rather than low-cost manufacturing plants.
- Who are some companies adopting this model? Novartis, Baxter, and Bayer are notable examples of companies adopting this model in Mexico.
- What services do these centers provide? These centers offer a wide range of services, including data management, digital solutions, IT support, procurement, manufacturing automation, standardization, infrastructure management, security and hygiene, and digital marketing.
- Why is Mexico becoming a hub for these services? Mexico’s strategic location, qualified talent pool, and diverse labor market make it an attractive destination for transnational companies seeking high-value service centers.
- What challenges does Mexico’s healthcare sector face? Despite the growth of service centers, Mexico’s healthcare sector still faces issues like supply shortages (IMSS Bienestar not receiving supplies from vendors due to lack of a structured platform, limited warehouse hours, and congested cold storage) and delayed payments to suppliers, particularly affecting small and medium-sized enterprises (SMEs).
