Manila-based offshoring and outsourcing solutions provider MicroSourcing announced last the opening of its first Australia based office, which marks yet another milestone for the company as it continues to experience near record growth in 2012. To support the growing demands of a bustling Australian economic climate, MicroSourcing has also launched http://www.microsourcing.com.au.

The goal is to satisfy Australia’s growing interest and need to include offshore and outsourced teams to their company structures and delivery strategies.

“We have observed a substantial increase in the number of Australian clients we are acquiring and feel that a home-turf presence inspires more confidence in the services we provide, “ stated Philip Kooijman, CEO at MicroSourcing. “Small and medium sized businesses are now realising the positive benefits of utilising off-shore teams, including increases in productivity, operational efficiencies and access to skilled labour that would be otherwise difficult to attract locally.”

The Sydney office is the first for MicroSourcing outside of the Philippines. The purpose of this high-powered physical integration is to serve the Australian business community efficiently and effectively through hands-on transition management and providing on-going service support.

The Philippines has emerged as a premier choice for offshoring and outsourcing for Australasian companies because the cultural, economical and geographical integration is virtually seamless. With the new office in Sydney, MicroSourcing has bridged the geographic gap between the two countries and is able to offer Australians easy access to a highly skilled, cost-effective workforce in the Philippines.

By Michael Baker

The Australian BPO Report 2012 shows that online marketing will grow from 6% of major firms outsourcing online marketing to 17% in the next 1-2 years.
- Editor

The percentage of e-commerce sales in Australia is set to jump ahead in the next two years.

In the important November/December trading period in the UK last year e-commerce accounted for over 10 per cent of retail sales for the first time.

The momentum then continued breathlessly into the new year with online sales surging north of 11 per cent of the total retail takings.

Meanwhile, in the United States, e-commerce’s share of sales has still barely topped the 5 per cent barrier despite more than a decade of mainstream experience with the online channel.

This begs an obvious question: Why have the British embraced online shopping at the expense of conventional retail channels so much more than Americans? And importantly for Australian business – will Australia follow the UK’s e-commerce growth trajectory or the more subdued American one?

The stakes are huge for those heavily invested on the property side, such as retailers with stores, shopping centre operators, investors and the whole industry supply and distribution ecosystem.

The answer to the question is found in a place that is usually overlooked as an influence in the e-commerce arena, and yet exerts enormous influence right under the noses of everybody in the retail industry – the Australian and British planning bureaucracies.

Australia has come late to the internet party for a number of reasons, not the least of which are its technology-shy mainstream retailers and a parcel delivery infrastructure that elicits nostalgia for Cobb & Co. Even so, according to the most recent data from private sources, e-commerce as a percentage of retail sales in Australia is already about the same as that in the US and set to forge ahead in the next year or two.

So far then, Australia’s e-commerce growth profile is looking more like Britain’s than America’s. And as many Australian store-based retailers bemoan their slow start to 2012 and look ahead to another year of mediocre sales growth, many will blame e-commerce itself.

This is a false attribution. E-commerce is not the villain of this piece, neither is the high saving rate, neither is the weather, and neither – for heaven’s sake – is Spain’s fiscal crisis.

The reason real estate is losing market share to the internet at a faster rate in the UK and Australia than in America is that it was all planned that way.

In the UK, government planners have spent decades defending the High Street precincts by preventing the development of suburban shopping centres. The High Street hubs continued to crumble anyway and ultimately the regulators grudgingly allowed the development of some shopping centres, not out of any love for consumers but more because shopping centre developers were a ticket to economic revitalisation.

Nonetheless, the damage had already been done. UK’s shopping centre space per capita is now less than a quarter of that in the US and its total retail space per capita is less than half.

This has narrowed the choices available to British shoppers relative to the US and made online shopping vastly more attractive once the e-commerce infrastructure was put in place.

Australia’s planners have done an equally comprehensive hatchet job on retail development as their UK brethren, not just stifling competition by limiting the supply of floorspace but with prescriptive zoning practices.

This is exemplified by the obsession with herding businesses into ‘activity centres’ and even – in the case of the infamously-named ‘bulky goods’ centres – setting aside zones which lock out various kinds of retail formats.

These kinds of planning constraints have prevented the natural process of forging hybrid retail formats that evolve to meet the changing needs of shoppers in consumer-friendly countries.

The first major result of all this planning activity has been the strangulation of supply, which has left Australia with barely more retail space on a per capita basis than the UK. Result: fewer choices for Australian consumers and higher prices.

A second major outcome is that consumers are stuck with a retail hierarchy that is 30 years out of date, lacking a number of important formats that thrive overseas. Examples of formats missing from the Australian retail scene are power centres, retail parks, lifestyle centres, power towns, super-centres and, until recently, warehouse clubs. Factory outlet centres have just squeaked in under the wire, but have been mostly confined to airport land. Result: fewer choices and higher prices.

A third major outcome is the most common complaint you hear from international retailers wanting to come to Australia: the difficulty of getting appropriate sites, another corollorary effect of planning constraints. The injection of fresh blood into Australian retail from overseas has therefore been stifled by planning regulation as well. Yep, fewer choices and higher prices.

With all these strikes against the planning system, it’s small wonder that e-commerce penetration in Australia is set to follow the much more aggressive growth path of the UK rather than the more moderate path of the US where shopping options in the normal terrestrial channels have been allowed to flourish.

So, look for 10 to 15 per cent of sales to be accounted for by the internet in Australia within five years.
About the only thing that stands in the way of e-commerce now is Australia Post, which has evidently decided that the vexing ‘last mile’ of delivery is not its problem any more.

Leaving cards in letterboxes and installing lockers in its own branches are the preferred delivery solutions, keeping the onus on shoppers to drive somewhere to pick up their packages or have them returned to sender.

Michael Baker is principal of Baker Consulting and can be reached at michael@mbaker-retail.com and www.mbaker-retail.com.

Read more: http://www.smh.com.au/small-business/growing/the-ecommerce-explosion-its-all-in-the-planning-20120420-1xba3.html#ixzz1sd0BhGdg

Heralds the creation of a formidable top-tier player with 2012 revenues that will reach in excess of USD 1 Billion KEY HIGHLIGHTS OF THE NEW BPO DIVISION: Successfully transitions acquisitions including Intelenet Global Services in India, The Listening Company in UK and Excelior in Australia to fold into a larger BPO capability Potentially amongst the top 10 BPO players globally, top 5 BPO players in Europe, top 4 India based BPO players and the largest supplier of services in the domestic India BPO market. Now has one of the strongest on-shore capabilities amongst Indian BPO players To engage new markets like Africa, China, Latin and South America.

Serco, the international service company, announced the launch of a new global BPO division that will improve the services Serco provides to its customers and enable it to target global opportunities both in the public and private sector. Also referred to as the Global Services division within Serco, it heralds the emergence of a formidable top-tier BPO player, both within the international and Indian markets, with revenues in excess of $1 billion by the end of this year. Serco’s new BPO division reflects scale, depth of capabilities and the creation of a larger global delivery platform.

Incorporated as one of four business divisions within Serco, it brings together a number of BPO related operations and capabilities currently reported and managed in different Serco divisions. Thus it is an amalgamation of the contracts and companies that deliver business process services globally within Serco including Intelenet Global Services in India – a leading provider of business process outsourcing (BPO) services to the private sector around the world and a predominant player in the domestic Indian market; The Listening Company in UK; and Excelior in Australia – all leading providers of outsourced contact centre services in their respective domestic BPO markets.

The Global Services division has a workforce of around 50,000, over 150 clients, and a diversified footprint with a presence in 10 countries, 98 locations. The business will focus on five vertical markets – namely Banking, Financial Services & Insurance; Travel, Hospitality & Transportation; Healthcare, Utility, Retail & Manufacturing; Telecom, Technology & Online Services; and Media, Education & Government.

Tom Riall, CEO Designate, Global Services, Serco, said, “The evolution of the Global Services division supports Serco’s vision to create a leading international Business Process Outsourcing Company. We will now be reckoned as an end to end service provider offering the complete spectrum of business services to customers in the public and private sector around the world, by combining Serco’s front end service capabilities along with world class middle and back-office capabilities. Furthermore, the Global Services division will work alongside other regional divisions in order for Serco to deliver fully integrated services for our customers, thereby making us a one-stop destination for existing & potential clients.”

NCO Group, Inc., a leading provider of business process outsourcing services, announced that it has completed the merger with APAC Customer Services, Inc.  In connection with the Merger, the Company entered into a new credit facility of approximately $1 billion, including a $120 million revolving credit facility.

APAC and NCO will both continue as leading brands in the global BPO market, operating under the holding company Expert Global Solutions, Inc.   With combined revenues of approximately $2 billion, APAC and NCO will be a fully scaled BPO provider in both the CRM and ARM segments, serving 40% of the Fortune 500. 

In addition to the merger, the Company has created a long term capital structure that will provide further expanded credit availability and debt maturities extending to 2017 and beyond.  Based on previous announcements by Moody’s Investors Service and Standard & Poor’s, the Company expects that its current corporate ratings will be upgraded two levels to new ratings of “B2″ and “B”, respectively.

Commenting on the merger and new financing structure of the company, Ron Rittenmeyer, CEO, Expert Global Solutions, stated, “As a result of this merger, we now have one of the most comprehensive, unique, and compelling BPO offerings in the marketplace.  Our clients have the benefit of a fully scaled and global partner serving all aspects of the CRM and ARM industry. The EGS worldwide team of associates is highly trained and focused on our customer’s quality, compliance and experience.” 

A summary of some of the key attributes of the combined company are:

• Combined revenues of approximately $2 billion
• Over 40,000 employees
• 14 countries
• Over 120 contact centers
• On-shore, nearshore, offshore, work @ home solutions
• Clients include over 40% of Fortune 500

Vertical expertise and BPO domain experience in many markets, including: Financial Services, Insurance, Healthcare, Pharmaceuticals, Transportation, Logistics, Government, Telecommunications, Cable, Technology, Retail, Education, Utilities, among others.

About APAC
APAC is a global leader of Customer Care BPO services and solutions including sales, customer care, technical support, and back-office services.  APAC’s clients include some of the most recognized brands in the world across all major market verticals.  APAC operates via a world-class technology and operational delivery platform that spans North America, Latin America, Europe, Africa and Asia. APAC is an equal opportunity employer.  For more information, visit APAC’s website at www.apaccustomerservices.com.  

About NCO
NCO is a leading global provider of business process outsourcing services, including accounts receivable management, revenue cycle management, and order to cash BPO services.  NCO provides services across multiple vertical markets through a combination of voice, chat, email, voice automation, back-office, social media, and self-help portals.  NCO provides services through over 120 offices throughout North America, Latin America, Asia, Europe, and Australia. NCO is an equal opportunity employer.  For more information, visit NCO’s website at www.ncogroup.com.

About EGS
Expert Global Solutions is the holding company for APAC and NCO. EGS leads and manages both APAC and NCO brands in the market addressing the needs of its customers as a fully scaled and global partner serving all aspects of the CRM and ARM customer lifecycle.  EGS offers clients the unique compliment of scale and a customized CRM and ARM service delivery platform.   

In the rapidly changing scenario within the Indian BPO industry, the market is abuzz with merger and acquisition talks. Mahindra Satyam acquired Vcustomer, then got merged with Tech Mahindra . Now the speculations are high that Infosys might buy a major stake in Firstsource .

DNA Indiareports– “Firstsource has a huge debt burden, made worse by foreign currency convertible bonds (FCCBs) — bonds with a fixed maturity issued by Indian companies to foreign investors — due to mature later this year. Around 60% of the FCCBs maturing were raised at a rupee-dollar rate less than 42 and since rupee has significantly depreciated in 2011, the firm is expected to bear heavy losses.”

First source has been trying to sell itself for last 1 year however was unable to get a suitable buy till Infosys begun to show some interest.

Experts suggest “Firstsource derives 34% of its revenue from healthcare. If Infosys goes for the acquisition, it will add more teeth to this vertical, which is expected to give contract wins in the coming quarters, thanks to the US healthcare reforms.

In another major development as reported by Times News Network, Back office majors Sutherland Global Services and Genpact are in the final race to acquire Apollo Health Street, the healthcare business process outsourcing (BPO) arm of Apollo Hospitals, in a deal valued at over Rs 1,100 crore ($220 million).

Sutherland, which has put in a higher bid, is the front-runner in the race.

Apollo Health Street takes up the outsourced financial and technology work for the big healthcare service providers, helping them to run profitable and efficient operations.

The acquisition will help Sutherland to scale up in the healthcare BPO segement.

Source: BPO Voice

THE BUSINESS Processing Association of the Philippines (BPA/P) will propose to the Commission on Higher Education (CHEd) the inclusion of a service management core subject in college.

The proposal comes as BPA/P and CHEd signed a memorandum of cooperation yesterday at Eastwood City, Libis to start a five-year partnership to revise college curricula, develop a training program for teachers and an assessment tool to determine a graduate’s readiness to enter the information technology (IT) and business process outsourcing (BPO) industries.

Noting the difficulty in finding qualified individuals to fill job openings in the industry, the group underscored human resource development as key to achieving the IT-BPO medium-term road map goals of generating $25 billion in annual export sales and creating 4.5 million jobs — 1.3 million directly and 3.2 million indirectly — by 2016.

“We believe that our partnership with CHEd will give a big boost to our efforts to tackle our number one challenge of improving the quantity and quality of our talent supply,” BPA/P Chairman Alfredo I. Ayala said on the sidelines of the memorandum signing.

“We do need help in developing human capital in the Philippines. At first, I was uneasy about pushing our college graduates to work in the BPO industry. But when I was introduced by the association to the broad nature of the BPO industry, I began to learn about opportunities the industry presents to our graduates in various fields,” CHEd Chairperson Patricia B. Licuanan told reporters.

“CHEd is throwing its full support behind the IT-BPO industry because we see this as a key long-term solution toward job creation and poverty alleviation. We are expecting that, through this collaboration, we can now give significantly more options to our future graduates so that they do not have to leave the country in order to win high-paying jobs where they can learn world-class skills.”

Under BPA/P’s proposal, colleges can incorporate a “BPO 101” in their core curriculum for all students, regardless of their specialization.

On top of this introductory subject, students can also make service management their minor course, said Martin Antonio S. Crisostomo, BPA/P external affairs executive director. Such students will be schooled in BPO culture, problem solving and other analytical skills, he added.

Source: BWorld Online

GlobalConnect changes name to AGC Networks. GlobalConnect was bought last August by Aegis Australia and over the past 12 months it has been integrated into the company.

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The Philippines is the most cost-effective outsourcing destination in Asia, according to real estate advisory firm CB Richard Ellis. In a recent study by CBRE comparing 15 central business districts in Asia, the Philippines was ranked the second cheapest with lease rates at $19.1 price per square foot/annum, next to Jakarta’s $16.3. This despite an increase in office lease rates in Metro Manila and a decline in vacancy rates this year. The Philippines also ranked second in terms of office rental yields in Asia, at 10% in the third quarter of 2011, following India’s 11%.

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Unisys Corporation announced that its Australian and New Zealand subsidiaries have signed agreements with McDonald’s to provide end-user IT support services to McDonald’s restaurants across Australia, New Zealand and the South Pacific. The five-year contracts have an estimated combined value of approximately AU$30 million (US$30.5 million) and represent new business for Unisys.Under the terms of the contracts, Unisys will provide service desk, on-site and remote support services to McDonald’s chain of more than 1,000 company-owned and franchised restaurants across Australia, New Zealand and the South Pacific region, including New Caledonia, Fiji, Tahiti, American Samoa and Samoa.

A précis of an article that appeared in the Straits Times in Singapore.

The year 2020 may have once sounded more like the stuff of science fiction novels. But it is only eight and bit years away now. In a new report “Imagining Asia 2020” a team of researchers and analysts from DBS Bank look into their crystal balls to see what 2020 might hold for Asia

1. GDP growth: Asia will surpass the US in economic size.

Asia has long been the fastest growing region in the world. And last year it overtook the United States as the main driver of global growth.

Mr. David Carbon, managing director of economic and currency research at DBS said “This is the biggest structural change going on in the global economy today. Asia has been getting a little bigger and bigger, and is now at the point where it is big enough where it matters. 5 years ago, 10 years ago, 15 years ago, it was not big enough to matter, not big enough to drive its own recovery, but today it is.”

By 2016, Asia will catch up in size with the US. By 2020, it will be 17% larger than the US economy.

The speed of growth has been simply breathtaking. In 2000, Asia was only 40% of the size of the US. By 2010 it was 80%.

China will contribute 64% of this growth over the next eight years, and India 17%, making them the two most important drivers of growth by far.

2. People power: Asia will add another US to its population.

We have just had the 7 billionth person born and by 2020 Asia will have added another 220 million people, almost the entire population of the US. “That is 10 times more than the US population is going to grow by. For every single new person we have in the US by 2020 we are going to have 10 new people in Asia,” said Carbon

Mr. Bhaskaran Manu the chief executive of Centennial Asia advisors and vice president of economic Society of Singapore, said: “if the population growth occurs in countries with endemic political and economic problems, these problems could perhaps get even worse. But if the growth is in rapidly growing economies, which can provide good jobs for the additions to the workforce, then the impact is likely to be positive.”

3. Urbanized nation: China will have over 100 cities with more than 1 million people each.

China will have seven megacities by 2020. There will be more than ½ a dozen mega cities with a population of over 8 million each. However China will also have a whopping 130 other cities with populations of more than 1 million people each.

It’s not just all about China and India, in Southeast Asia, over 20 secondary cities across Indonesia, the Philippines, Thailand, Vietnam and Malaysia also behind the growth of people by 2020, said the DBS report

The demand for infrastructure development and urban makeovers is therefore immense. “Urban centers offer economies of scale and make it more efficient to provide services such as education, healthcare, clean water and safe sanitation,” said the DBS report

“A skilled labor force attracts investments that generate more employment and prosperity, setting off a virtuous circle of economic gain.”

4. Hey big spenders: Asia will be the next big consumer.

Americans are not the only big spenders. Asia is expected to at least double its current level of consumption and will consume 80% as much food as the US.

It will more than triple the growth rate of private consumption of the US over the next 10 years said the DBS report.

Food will be a large part of that spending. One out of every four dollars spent by each household will be on food.

5. Wealth creation: Asian incomes have lots of room to rise

Between the mid-1960s and today, income levels in most Asian nations have grown by 5 to 8 times. But most of Asia is still far behind developed Western nations such as the US and Europe in terms of household income levels.

So while income levels have grown rapidly in Asia, there is still a lot of catching up to be done and it means “fast growth in Asia should be able to continue for a long time”, noted the DBS reports.