Avasant Asia President Interviewed by Business Daily Africa: Outsourcing centres asked to woo SMEs
April 9, 2009: Business Process- Outsourcing centres have been told to seek opportunities in small businesses as larger companies cut down spending on IT-related services in the global financial meltdown. The chief executive of Avasant - a global outsourcing advisory - Dr Pradeep Mukherjee, told African countries to seize the opportunity to exploit untapped markets by encouraging their BPOs to focus on small firms. "It is true that bigger companies have cut their spending on IT and outsourcing by about 20 per cent but there is this larger market ( SMEs), which have neither outsourced nor done offshoring but are now looking into attractive locations to do so," he told a gathering of IT experts in Nairobi. Multinational Companies Despite the fact that most multinational companies are slashing IT budgets and Business Process Outsourcing, Africa and Kenya, particularly, could still grow their markets by focusing on the SMEs across the globe that are keen on contracting third parties to do for them specific assignments. However, Dr Mukherjee says the emerging economies in this sector must work on issues, including finding a niche, position, and branding as an outsourcing destination, not as individual operators. Dr Mukherjee presented a paper yesterday on how African countries can tap opportunities for BPOs in the global downturn. He told the sector players gathered for the BPO conference in Nairobi that there were opportunities in the segment to be tapped, but pointed out there had to be the right infrastructure in place. To build a strong BPO sector, the local operators were urged not to concentrate on the international clients but also woo local and regional clientele. Apart from making them stay afloat, the local clients would enhance the operators' experience as they seek other more lucrative deals. The SMEs, the conference heard, were looking forward to new business and pricing models based on such practices like the Build and Transfer Operators (BTO). Among the SMEs that Kenyan operators can target are suppliers with whom partnerships can be forged to offer these companies an opportunity to grow. But in the pursuit of growing this business, operators were told to ensure they have the right business governance and invest in the latest technologies such as 'cloud computing' which enable the users to access information real-time. Kenya is among emerging 80 countries that are positioning themselves to attract foreign-based services in the outsourcing sphere. The government has put the BPO as one of the flagship projects to achieve the Vision 2030 and expects the sector to employ 80,000 call centre agents by 2015. Others include Egypt, Tunisia Morocco Mauritius Ghana and South Africa who otherwise have a developed BPO and contact sector compared to Kenya. Many Advantages Kenya is said to have several advantages that it can use to position itself: geography, a pool of talent and time zone. Statistics from the Kenya BPO and Contact Centre Society indicate there are 50 operators. However, the number of operators is expected to grow when the country gets affordable and reliable Internet connectivity through the two undersea cables, Seacom and Teams that are expected to land by the end of this June. Gilda Odera, the chairperson of the association, says most of the players are in call centres, data centers, software development and animation. Ms Odera noted that Kenya can take advantage of the downturn situation and market itself as an alternative outsourcing destination.