[kictanet] Day 10 of 10- BPO Discussions, Strengths and Weaknesses (Observations from USA and UK); and Trends and Niches

[emko at internetresearch.com.gh]

Dr. Ndemo,

You could not have concluded this conversation any better.

After all have being said and done, ATTITUDES are still the KILLER APP. We
can develop all the plans and strategies but the basics like honesty,
faithfulness, hardwork, teamwork etc cannot be wished away.

Eric here


> Indeed this country has a number of strengths but our greatest weakness-
> negativity- will consume all the strengths we have.  I read once when
> India's BPO industry was under attack from western Media over theft
> especially back office work for credit card companies.  India was united
> in defending their country.  What happens here?  We even assist to destroy
> the little we have.  We see competitors as enemies instead of embracing
> them and working for the country.  No matter what we do, until we see
> ourselves as Kenyans first and rid of ourselves from petty negative
> attitide towards others we cannot succeed.  There are foreigners here too
> exploiting and magnifying our differences.  It is these little things that
> would make us succeed.
>
>
> Ndemo.
>
>
>
>
>
>> Hi Listers,
>>
>> I am not sure if it is due to the end of two weeks of intense
>> discussions
>> but we are supposed to bring the discussions to fruition today. As I had
>> mentioned, day 9-10 discussions are the same, that is as described
>> below.
>> Please let us continue to have your input. We will spill over into
>> Monday
>> as this is a very topical issue.
>>
>> Let us strive to identify Kenya's niche areas based on the strengths and
>> weaknesses identified.
>>
>> Have a great weekend as we continue receiving your input.
>>
>> Nyaki
>>
>>
>>
>>
>> 2009/6/12 Catherine Adeya <elizaslider at yahoo.com>
>>
>> - Day 9 of 10 - BPO
>> Discussions, BPO Discussions, Strengths and Weaknesses (Observations
>> from
>> USA
>> and UK); and Trends and Niches
>> My apologies about the bouncing emails yesterday, the issue is being
>> addressed. As we close the youth and gender debate,  I do recognize that
>> some issues may be pending on this so feel free to address them but
>> under
>> the right subject header. I also noticed that there were queries about
>> the
>> labour laws and Employment Act and maybe we can revisit this at the
>> right
>> time.
>> However, we have two days to discuss
>> the final theme beginning today. This theme synthesizes the strengths
>> that
>> make
>> South Africa, India, Mauritius and Kenya choice BPO destinations. It
>> also
>> synthesizes the countries’ weaknesses. Finally, the synthesis includes
>> observations from the USA and UK as sources of outsourced work, the
>> trends
>> in
>> BPO and the niches the selected countries have pursued or are likely to
>> pursue.
>> The following is a summary of the research findings; a more detailed
>> summary is
>> attached.
>> STRENGTHS AND WEAKNESSES
>> The researchers found
>> that some of India’s strengths
>> include government championship, the government works closely with
>> NASCCOM
>> (National Association of Software Services Companies) and involves
>> NASCCOM
>> in
>> all policy decision making regarding the industry.  India generally has
>> a
>> large pool of science,
>> technology and engineering graduates which has made it a preferred
>> destination
>> for high end knowledge process outsourcing. In addition, there are tax
>> incentives; National Skills registry (NSR) to facilitate personnel
>> background
>> checks; and investors have single window clearance for License
>> application. South Africa on the other hand also has
>> clear government championship for the BPO sector evidenced by the fact
>> that
>> investors and potential vendors are wooed from the Office of the
>> President.
>> There is also commitment to regulatory changes when required. There is
>> an
>> effective marketing strategy
>> (target marketing and perception management), which has made many in the
>> world
>> perceive South Africa to be politically and economically stable. There
>> is world class connectivity; S. Africa has 10 international airports, an
>> excellent road and railway network.
>>
>> Mauritiusstrengths include good ratings from the
>> World Bank ‘Doing Business Indicators’ which ranks the country at
>> position 24
>> for favourable investment climate and number 11 for protecting investors
>> and 7
>> for starting a business. In addition, it is a multilingual country (with
>> two
>> European languages) so it is an attractive destination for both English
>> and French
>> speaking clients. Some of the key strengths that make Kenya a choice
>> destination for outsourcing is that it is a good
>> place to work and holiday (temperate weather and beautiful country).
>> Indeed,
>> many senior people working for bilateral or international organizations
>> have
>> preferred to live in Kenya after the end of their contracts. Kenya also
>> has
>> government championship of the BPO industry. The country is
>> strategically
>> located and a regional hub for communications and finance. Kenyans
>> generally
>> have a good English accent for English speaking clients.
>>
>> Weaknesses were also
>> assessed in all four countries.  In India, for example, there has/was an
>> international backlash due to security breaches that made some companies
>> pulled
>> out of India. There is also the issue of high cost of electricity.
>> Another
>> factor is the heavy Indian accent which has resulted in poor customer
>> experience especially for call centre work for international clients. In
>> S. Africa the cost of operation is still high compared to other
>> outsourcing
>> destinations. Also, even though there are BPO specific incentives,
>> investors are yet to take advantage of these because of the strict
>> qualification criteria.
>>
>> In Mauritius some of the weaknesses
>> highlighted were the negative perception of
>> working in 24/7 environment and many Mauritians cannot imagine working
>> at
>> night. Secondly, Internet and mobile communication tariffs are still
>> high
>> despite liberalization and presence of the submarine cable. Finally, in
>> Kenya, I will emphasize a little more,
>> there is a perception in client countries thatKenya is not politically
>> stable.  It also appears that Kenya lacks an effective marketing
>> strategy.
>> Some believe that Kenya is sending the
>> wrong people to woo investors. There is lack of coordination and
>> perceived
>> ‘bad
>> blood’ between some of the key institutions and groups that represent
>> this
>> industry; this is also evident to client countries like in the UK. This
>> is
>> not
>> helped with the soaring electricity costs combined with
>> the high amount of power outages which has made the cost of doing
>> business
>> very
>> high as companies have to invest in generators.Of course, the state of
>> the
>> road infrastructure is wanting and the
>> issue of constant traffic jams causing loss of productive time.
>>
>> USA
>> and UK: The attached summary has some analysis from the USA and
>> UK which includes their preferred outsourcing destination. In the USA,
>> the
>> top
>> ten (10) preferred outsourcing destinations, in order of preference are:
>> 1.
>> Rural or Small Town USA (via Indian Companies), 2. India, 3. Eastern &
>> Central
>> Europe, 4. UK & Ireland (areas of high unemployment), 5. South America,
>> 6.
>> Mexico, 7. Philippines, 8. Canada, 9. Russia and 10. Middle East. It can
>> be
>> noted that Africa does not feature. In the UK, the perceived best three
>> destinations as voted during NOA’s 2008 (www.noa.co.uk.index.php/awrds
>> )
>> annual awards: 1. Egypt, 2. Romania and 3. Philippines.
>> NICHE AREAS
>> Some of the proposed niche areas for the vendor countries are:
>>
>> India: The niche areas for
>> India are a little hard to perceive as they were front-runners in the
>> BPO
>> industry amongst developing countries. Over time they have found that
>> some
>> of
>> their niche areas are in remote ICT systems maintenance, software
>> development,
>> and numerical analysis for various companies.In addition, they have
>> capitalized on their experience and historical
>> advantage and are now outsourcing work (or assisting the client
>> countries
>> to
>> outsource work) to destinations where they do not have the comparative
>> advantage. A case in point is actuarial work to South Africa.
>>
>> South Africa: Great potential in the banking
>> sector. South Africa also has excellent actuarial and
>> insurance services. It is common to find people who may source work to
>> India
>> because it is cheaper but are now taking some of the actuarial work to
>> South
>> Africa as they will find the skill sets that they may not get as easily
>> in
>> India or Philippines. This trend may increase as they are willing to pay
>> the
>> optimum price for these skill sets not necessarily the cheapest price.
>>
>> Mauritius: Mauritius’s greatest niche
>> comes from the fact that the country is generally multilingual in two
>> European
>> languages (English and French). Many of the current BPO work in
>> developing
>> countries are amongst English speakers and they definitely need contacts
>> who
>> can also work with their potential French clientele. Mauritius is a good
>> destination for back office transcription and translation services. It
>> may
>> also
>> be a good destination for front office work that needs translation
>> (English-French).
>>
>> Kenya:Kenya
>> appears to be an excellent destination for some types of back office
>> work.
>> These include financial services (accounting and payroll services) and
>> legal
>> work as there is a highly educated population in these areas. It can be
>> argued
>> that there may be an opportunity for front office (call centre work) as
>> many
>> say the Kenyan accent is neutral though there has to be training in this
>> area
>> to ensure there is standardization so Kenya can avoid many of India’s
>> mistakes.
>> There is clearly an opportunity for transcription and translation
>> services
>> (based on fact that multi-lingual workers are easy to find). Due to the
>> predominance of the tourism and hospitality industries in the economy,
>> customer
>> service orientation is high amongst trained Kenyans.
>>
>> Discussion
>> Q12.There are many institutions marketing Kenya
>> and are not doing a good job of it and/or are not working from the same
>> script.
>> What institutional set up should we have for marketing Kenya for BPO&O
>> and
>> how can we improve the coordination and the similarity of the messages?
>> Discussion
>> Q13.
>> Consider the following three examples. One, South Africa has many
>> challenges,
>> some of which, like security, are more serious than those for Kenya.
>> However,
>> many in the world perceive South Africa as a worthwhile destination in
>> Africa.
>> A lot of work has been done by the South African Government to create
>> this
>> perception. Two, India’s cost of electricity is as high and unreliable
>> as
>> Kenya’s. However, India is still the number one BPO destination.
>> Three,
>> there is
>> the issue of the heavy Indian accent which has resulted in poor customer
>> experience. Consequently, there are jobs that are going back on-shore to
>> the
>> client countries. Some of these clients are willing to outsource again
>> to
>> the
>> right destination where accent will not be a major problem. This was
>> confirmed
>> in interviews in the UK. Given the strengths of Kenya, the opportunities
>> available locally and abroad, and the lessons from other outsourcing
>> destinations, what key marketing strategies should Kenya adopt?
>> Discussion Q14.
>> Given the findings reported here and the discussions that we have had
>> here
>> on
>> KICTANET in the last two weeks, what niche(s) do you think Kenya should
>> pursue?
>>
>> I
>> know the Bugdet 2009-2010 issues may be upper most in your minds but let
>> us
>> focus on bringing this excellent 10 day discussion to fruition.
>> I thank
>> you in advance.
>> Nyaki
>>
>>
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>>
>>
>> --
>> Grace L.N. Mutung'u (Bomu)
>> +254721898732
>> +254736091242
>> Kenya
>>
>>
>>
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