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

[Wainaina Mungai]

Eric,

The reason a Kenyan company wouldn't trust a call centre in Nigeria
has more to do with attitudes and stereotypes - some unfounded - than
with capacity. Before closing a deal, you'd notice a higher level of
due diligence.

Our BPO branding exercise must therefore become part of a wider
national branding effort. This issue arose at the onset of these
discussions. Media and others must ensure a positive projection of
Kenya as a nation and that of our BPO sector.

Our media must stop feeding the stereotypes like the 'mungiki' image
of Kenya; or the notion that we are a helplessly corrupt lot. A new
message must be communicate just like the PROUDLY SOUTHAFRICAN brand
that has diverted many opportunities southwards inspite of the crime
levels in Jo'berg.

Wainaina

On 6/14/09, emko at internetresearch.com.gh <emko at internetresearch.com.gh> wrote:
> 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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