Globally business process outsourcing (BPO) continues to grow exponentially and South Africa has the potential to increase its stake in a market that is expected to grow to a whopping $195-billion by 2010.
This is according to Pule Mokoena, group executive of Marketing at Innovation Group, leading business process consulting and administration company, and South African subsidiary of London-listed global BPO operation, Innovation Group.
“While we offer holistic BPO, consulting and administration solutions, we also offer, as part of these solutions, numerous call centre options for various large organisations in South Africa, spanning a wide range of industries, including the motor industry, finance and insurance. While that is only part of the outsourcing services we offer, we do see potential for a great deal of growth for local companies.
We are rapidly becoming more competitive in the overall outsourcing market, not just in the call centre sphere of things. An increasing number of businesses are starting to recognise the benefits of outsourcing by leveraging off experts to manage non-core functions and services – that can be done far more efficiently when outsourced.
“Indeed,” says Mokoena, “experience – and results – have shown that any non-core area can be outsourced. While the more mainstream payroll and financial services – such as debtors – have been outsourced for some time now by many companies, IT, marketing and communication are starting to be outsourced by more companies. It is a fast-growing business area.”
Referring again to the call centre and general outsourcing market, Mokoena says this market is going to become increasingly popular in SA – especially since Telkom has reduced rates for certain qualified BPO players. But the critical mass must be right, he says.
"If a company has around 200 or less employees, operating a call centre business can be a financial nightmare. The infrastructure can be costly since it must be acquired, installed and maintained. And, of course, it needs to be upgraded to keep up with the ongoing technological demands. The right employees need to be found, trained and retained. And retaining staff in this sector is very difficult.
“Also on the downside is the country’s spiraling interest rates and our electricity supply problems. This is making it harder for local companies to get a larger foothold in the call centre market – and the BPO market in general.”
In a recent press report it was stated that an international report from Grant Thornton Strategic Solutions revealed that the biggest drawback for this country when it comes to private business growth – across all sectors – is lack of skills. The report said that a worrying 48% of businesses noted this as a problem, while 52% of service-focused companies said it was arguably the biggest constraint to growth. Because of this factor alone, outsourcing makes more sense.