India beckons … so too do the Philippines, China and African countries where outsourcing operations like this call centre. Photo: AFP

Finance sector workers are under threat from the global drive towards outsourcing, write Matt Wade and Mark Hawthorne.

ANZ’s global website had 55 jobs advertised at its new Manila operation this week. They ranged from a new head of human resources to credit risk officers and business analysts. Almost all required a high level of university education, two years of similar experience and fluent written English. A further 10 jobs are available with the bank in Indonesia. But not a single job is being advertised in Australia.

It’s a similar story across the financial services sector.

Run the numbers and it’s easy to see why banks are transferring jobs overseas. An Australian-based credit risk officer with NAB told Weekend Business a “reasonable wage” was $60,000 a year, up to $80,000 for someone with more experience.

In Manila, jobs for overseas banks are advertised in local papers, to work out of one of the many brand spanking new offices near the capital.

Jobs for credit risk officers working for overseas banks – which one is never identified – are being advertised at between 20,000 and 30,000 pesos a month, equivalent to $5000 to $7800 a year. For that a university education and a minimum of four years of similar experience are needed. The jobs websites and newspapers in Manila are filled with ads for such jobs.

So far Australian companies have not pursued overseas outsourcing as aggressively as businesses in some advanced economies. One reason is the strong performance of the Australian economy, especially compared with US and Europe.

But as technological innovations expand the range of activities that can be outsourced, the number of service sector jobs that are vulnerable to offshoring has grown, at least in theory.

Modelling commissioned by unions, including the one representing financial sector workers, showed at least 250,000 jobs across Australia’s service sector could be susceptible to outsourcing, especially in finance, telecommunications and IT.

And as economic storm clouds threaten, there is growing scrutiny on business costs, especially in the financial services sector. A report this month by the UBS banking analyst Jonathan Mott predicted Australian banks were set to shed thousands of jobs and come under increasing pressure to move more operations to cheaper locations overseas.

“Opportunities to achieve cost savings by moving processing offshore to India and other areas are now likely to be re-investigated,” the report says.

In the boardrooms of Sydney’s Martin Place and Melbourne’s Collins Street, talk of a “white-collar recession” in banking and finance has been going on for months. It’s only in recent weeks that the extent of the losses has been becoming clear.

After slashing 3309 jobs last year, according to figures from the Financial Services Union, more pain is in store this year. The big four banks are expected to slash a further 2 per cent of their Australian workforces in both this year and next, in the face of rising borrowing costs caused by the euro zone crisis and amid fears of global recession. That’s about 7000 jobs.

“This will be bigger than the job cuts that followed the GFC [global financial crisis],” says an ANZ executive, off the record.

But, while the Australian workforces slide, the number of staff employed in Asia by Australian banks continues to grow.

“If you look at our operations site in Church Street [Richmond], there are now two empty floors,” says the ANZ executive. “All those jobs have been outsourced to Manila. There have been no announcements, just creeping cuts across the staff numbers.”

When discussing international wage discrepancies, the former Victorian premier Jeff Kennett raises an eyebrow. “I’ve long held the belief that in Australia we are pricing ourselves out of global markets,” he says.

“We are a very highly paid nation of people in some areas, and it’s making it hard for many industries to compete. In particular I look at the retail sector, and the penalty rates, the double time and triple time, paid on a Saturday or Sunday. These are the leisure days, when people are out spending money, but the retailers and restaurateurs of Sydney and Melbourne will tell you it’s impossible to make a buck. It’s an issue we have to address as a society.”

The global outsourcing industry has thrived on economic crisis. The dotcom bust of 2001 sparked a boom for IT service providers in India as US tech firms cut costs by sending operations offshore. India’s business process outsourcing firms – or BPOs as they are known – then prospered when the global financial crisis smashed the US finance sector and teetering financial institutions scrambled to slash costs. When the global economy was in the doldrums in 2009, India’s 20 biggest BPOs managed to grow their export earnings by 15 per cent. The industry’s second-biggest player, TCS BPO, grew by 73 per cent.

Now, with tougher times again forecast, the Financial Services Union fears foreign firms will soon be getting more work from Australia.

Leon Carter, the union’s national secretary, says 5000 jobs have been sent offshore by the financial services sector in almost four years.

“The bulk of those jobs have gone to Bangalore, some have gone to Manila and also New Zealand,” he says. The banks’ outsourcing slowed during the global financial crisis but is now gathering pace again.

The big four have adopted different approaches to offshoring. NAB and Westpac have outsourced operations to specialist business processing firms while ANZ has adopted a “captive” strategy where it directly employs staff in lower-cost Asian countries. ANZ has recently opened “operations hubs” in Manila and Chengdu, in China, to go with a long-established centre in Bangalore.

The ANZ’s chief, Mike Smith, has emphasised the importance of these hubs, which facilitate the bank’s operations across Asia, not just Australia. “Our investment in our operations hubs continues to support our productivity agenda and we’re also placing a stronger emphasis on generating ongoing efficiencies,” he said in November.

“This isn’t a matter of reacting to events, but of dynamically managing our costs to reflect our business strategy and the market conditions.”

Commonwealth Bank is the only one of the big four, which has not opted for much offshoring, Carter says. “I think they understand that keeping work here … can be a positive differentiation from the other three,” he says.

Despite the deteriorating outlook for banks, Commonwealth is holding firm. “We don’t offshore and we have no plans to offshore,” a Commonwealth spokeswoman told Weekend Business yesterday.

Like the Commonwealth, smaller “second-tier” banks have not opted for major offshoring.

Among the insurers, Suncorp says about 100 jobs have been “impacted by partnering activity” over the past six months. The union says it has plans to send off many more.

Telstra is another big employer that has reduced costs by outsourcing operations over the years.
Carter says that the profitability of Australian banks means there is no justification for sacking Australians and sending the work overseas. “These institutions, particularly the big four banks, are incredibly profitable and they can afford to protect Australian jobs,” he says.

“They have an obligation to the community, the country, and part of that obligation is protecting Australian jobs. Yet they continue to sacrifice Australian jobs on the altar of profit.”

Attention has recently been fixed on troubles in the manufacturing sector but the political heat could shift to the finance industry if job losses in the sector mount. Banks and insurers are likely to come under pressure not to send operations overseas.

A Westpac spokesman says it continues to “access specialist skills from its global sourcing providers” but has no specific targets.

“Our partners provide us global scale and capability that we could not achieve on our own.”
Westpac’s chief, Gail Kelly, has tried to shift the debate by talking about “best sourcing”. “It’s called best sourcing rather than outsourcing because in some cases we in-source as well,” she said in November.
A spokesman for National Australia Bank says with a workforce of 44,000 worldwide, numbers “will fluctuate in various parts of the business at times due to the completion of programs, outsourcing of some projects and continuing focus on efficiency”.

He says NAB always tries to redeploy people within the business.

The union says offshoring is being done to please big institutional shareholders at the expense of workers and customers.

“If we want our banks to be run to benefit the rich shareholders, then we will see an increase in job losses and in offshoring,” Carter says.

The union wants more regulations to make it harder for banks to send jobs offshore. It has successfully campaigned for a financial sector “right to know policy” to be included in the ALP’s policy platform which, if legislated by the federal government, would require financial institutions to get customers’ permission before sending personal financial data offshore.

If adopted, this rule could make it much more difficult for banks to efficiently deploy back office operations offshore. Surveys done by the union have found more than 80 percent of Australians believe their financial data should not be sent overseas.

“If we can expose the practice and make the banks and insurance companies say out loud that they’re sending Australian data – that is deeply personal financial information – overseas, as well as Australian jobs overseas, that is not an argument they will win with their customers and as a result offshoring will be substantially reduced,” Carter says.

“We are working very hard with the government to get that policy position converted into legislation.”

The government has so far resisted the union’s push but it is working with the independent senator Nick Xenophon to introduce a private member’s bill on the issue.

Carter says offshoring is “all about cost reduction” but advocates for the outsourcing industry, such as Sri Annaswamy, director of the Sydney outsourcing consultancy Swamy and Associates, say it now offers much more than just lower costs.

Cashed-up Indian outsourcing firms are moving “onshore” by buying back-office operations of financial institutions in the US and Europe.

They have developed expertise to “use capital in back offices more efficiently”, Annaswamy says. This includes selling the services of back-office operations, once only available to the financial institution, to third parties. “It’s no longer just a cost game,” he says. “That is a point people often miss.”

Annaswamy sees signs of this process in Australia. Last month, the Indian technology giant Infosys purchased the Australian consulting firm Copeland. “They have found that getting an onshore skill set, particularly for procurement consulting for their BPO, was a great benefit.”

He says it would be counterproductive and xenophobic to introduce regulations to contain or prohibit the latest innovations in outsourcing. Instead, Australia should welcome Indian BPOs and work to create an outsourcing industry here.

“These companies are willing to make massive investments and employ thousands of people.

“To speak of them as some sort of slave traders trying to take jobs away from Australia is an absolute nonsense. The best way is to proactively embrace them and show that our own back offices can be transformed.”

The global outsourcing industry has changed dramatically over the past decade but is still in its infancy.
It is bound to throw up challenges for companies and workers in high-wage economies such as Australia for some time yet.

Source: Sydney Morning Herald

Study in contrasts: the offices of Genpact in Gurgaon, India, are seen in the background. Photo: Matt Wade

By Matt Wade

FIFTEEN years ago Gurgaon was little more than a highway stop on the outskirts of the Indian capital, New Delhi. Now it has dozens of shopping malls, seven golf courses and a forest of office blocks.

Gurgaon has been built on India’s internet-age outsourcing sector. The city’s heady, unruly rise is symbolic of the rapid growth of the industry. The country’s biggest outsourcing firms are housed in Gurgaon, many in futuristic-looking buildings. They are easy to pick because of the huge satellite dishes on the roof.

The staff service clients around the world, doing things as diverse as collecting debts from credit-card defaulters, managing drug research data for pharmaceutical companies or analysing companies listed on Wall Street.

At the Gurgaon office of India’s biggest outsourcing company, Genpact, the cafeteria is filled with smartly dressed young people with iPhones and security tags who talk of working the “London” or “Sydney” shift. Their well-appointed work stations would not be out of place in Sydney or Melbourne. But one thing is very different: the cost of their labour. Salaries for an English-speaking, university-educated worker at Gurgaon’s outsourcing companies start at about 20,000 rupees a month – less than $5000 a year. And they have counterparts in many low-income countries across Asia, Africa and South America.

The offshore outsourcing industry started to take shape in the mid-1980s when several US multinationals including Citibank and GE Capital established operations in India to capitalise on the large number of well-educated engineers in that country that demanded relatively small salaries compared with their rich-world counterparts.

“Multinational companies started to see the potential a place like India had, especially in IT,” says Sydney-based Sri Annaswamy. “The idea was very simple: you could get top-quality engineering talent that could beat the world for a fraction of the price that you would get in mainstream American markets. That is basically the arbitrage.”

Advances in communications technology during the 1990s, especially the internet, made outsourcing much cheaper and easier, and the range of activities being outsourced expanded into areas such as financial accounting and customer services, especially call centres.

These new “business-process outsourcing” ventures – or BPOs as they are known – took off and a swag of Indian IT entrepreneurs got involved.

More recently, the range of services outsourced has moved up the value chain from business processing outsourcing to “knowledge-process outsourcing” – or KPO – including financial research, actuarial services, high-level accounting, and legal services.

“Many firms, especially investment banks, eventually discovered there was huge capacity for analytical work to be done in India,” says Annaswamy. “They could hire Indian MBAs who were a lot smarter and a lot cheaper than guys coming out of Ivy League schools.”

Most Australians are oblivious to the scale and sophistication of the global outsourcing business, estimated to be worth about $US3 trillion ($A2.82 trillion) a year. Some BPOs have developed into major international businesses with expertise in managing complex business processing.

Genpact has annual revenue of $US1.26 billion, employs 53,000 people in 17 countries and is listed on the New York Stock Exchange. National Australia Bank is among its more than 600 clients.

The outsourcing industry now holds an important place in the Indian business landscape. The proportion of India’s gross domestic product generated by the collection of businesses known in India as the ”IT-BPO” sector grew from 1.2 per cent in 1998 to 6.4 per cent last year, industry group Nasscom estimates.

BPOs and its sister IT sector have come to symbolise a new India marked by rapid growth and innovation.

Millions of young Indians aspire to the relatively high salaries paid by BPOs and the lifestyles of their workers. Outsourcing firms now feature regularly in Indian popular culture including Bollywood movies and television shows. Best-selling author Chetan Bhagat sold more than 1 millions copies of his novel One Night @ the Call Center about six colleagues who sell home appliances from Gurgaon to US customers.

India remains the biggest player in global outsourcing, but it faces stiff competition. The Philippines has attracted call centres, many of them set up by Indian BPOs seeking lower costs. Industry analyst Dataquest says call-centre agents deployed by several Indian BPO firms in the Philippines surpassed the corresponding headcount in India in 2009-10.

Other low-wage Asian countries including Indonesia, Bangladesh, Pakistan and Vietnam have fast-growing outsourcing industries. Improvements in high-speed broadband have also spawned industries in several African countries, including South Africa, Egypt and Kenya.

India’s long experience in internet-based outsourcing and its talent pool mean it has an advantage over smaller countries. But several Chinese centres, such as Shanghai and Chengdu, have the scale, expertise and talent to give the Indian outsourcers a run for their money, especially in the knowledge-processing market.

Competition between outsourcing destinations promises to put downward pressure on costs. That will only increase the inventive for Australian companies to send jobs overseas.

Source: Sydney Morning Herald

As more and more Australian banks and accounting firms announce plans for job cuts, the Finance Sector Union has warned that the four largest banks may be poised to send as many as 1,000 finance sector jobs overseas to India and elsewhere in an effort to cut labour costs, according to a report by the Australian Financial Review.

Australia and New Zealand Banking Group (ANZ), Westpac Banking Corp and Ernst & Young’s Australia office all this week announced job cuts, with more expected.

“A whole raft of the jobs will disappear but a number of the jobs will be sent overseas,” FSU national secretary Leon Carter said, according to the AFR.

The Minister for Workplace Relations and Acting Treasurer Bill Shorten commented on the situation, but said it was unlikely the government would intervene. “I’m not going to second guess every banking management discussion,” Mr. Shorten said, according to the AFR. “In my experience, there’s always a cost when you lay someone off, there’s always a cost to retain someone. I think the medium-term prospects for financial services in Australia in the next five years are solid. In the medium term, prospects are good, in the short term, times are tough.”

One analysis suggested the financial sector could see as many as 7,000 jobs disappear as banks cut costs in response to global uncertainty, according to the AFR.

The Maritime Union of New Zealand has issued a strike notice at the Ports of Auckland, for a 24-hour strike starting 7am on Tuesday 31 January to 7am Wednesday 1 February.

Maritime Union National President Garry Parsloe says the strike notice has been put in so workers can get together at a meeting at the end of the month to discuss POAL management plans to outsource their jobs.

Mr. Parsloe says the Union would consider canceling the strike notice if management provided an opportunity for all union members to meet at the same time, but up to now the company had refused to do this.

He says it is irresponsible for management to threaten workers with the loss of their jobs and livelihoods of their families while refusing to negotiate.

“We have offered to work with management on productivity and flexibility measures but there seems to be some other agenda coming from management.”

“The CEO seems to have no empathy or understanding of the disruption and the worry he is causing his employees by his actions. Reasonable people will understand how his actions are causing this dispute to worsen by the day.”

Mr. Parsloe says if the Ports of Auckland CEO was genuinely concerned about disruption from occasional strikes, then he must immediately demonstrate his sincerity by abandoning his plan to outsource the jobs of port workers, which would result in months of ongoing disruption and harm for the Auckland economy.

“This is of course totally unnecessary when the Union is happy to meet and continue to find a negotiated solution, but we will not be dictated to and bullied into surrendering the rights of our members.”

Source: Auckland Scoop New Zealand

By Kathleen A. Martin

GLOBAL CONSULTANCY firm Tholons, Inc. has cited talent pools as a major challenge to the Southeast Asian countries’ business process outsourcing (BPO) industry but said it foresees niche specializations of the sector to continue to grow.

This, as 12 cities from the Southeast Asian region, including five from the Philippines, made it to Tholons’ Top 100 outsourcing destinations.

The five Philippine cities are Manila (4th), Cebu (9th), Davao (69th), Sta. Rosa (86th), and Iloilo (92nd).

“Addressing talent pool shortages will be the most critical issue in the Southeast Asian region’s IT (information and technology)-BPO industry as a whole. These should be immediately addressed to further drive the growth of the services outsourcing industry,” the firm said in its 2012 Tholons Top 100 Outsourcing Destinations: Southeast Asia executive summary released yesterday.

“This is especially significant as widespread cost-cutting measures brought upon by the recession in the US and UK markets are being pursued, which in turn, are driving up the demand for outsourcing,” the document read.

Tholons said BPO firms are experiencing difficulty in hiring and retaining “capable employees,” thus, resulting in higher attrition rates and an increase in hiring and retention costs.

“[Such] has resulted in greater initiatives by service providers to train fresh graduates or reskill lateral hires themselves, an exercise becoming increasingly common albeit more costly,” Tholons said.

Already, Tholons noted an initiative for skills development currently being undertaken in Manila is needed to increase the country’s talent supply.

“The Technical Education and Skills Development Authority (TESDA) of the Philippines, for example, has been continuously providing Finishing Courses for Call Center Agents targeted to near-hires in the Contact Support space,” the document read.

Despite the region’s foreseen supply problems, Tholons said niche specializations offered are expected to grow.

“Tholons sees that the region’s current niche specializations will continue to grow and pave the way for the development of higher-value services in Southeast Asia,” the document read.

Tholons said that in 2011, Southeast Asian countries have been steadily building their own outsourcing identities.

The Philippines has continued to be the premier contact support services destination, while Singapore and Malaysia have become financial and accounting outsourcing and back-office process outsourcing pillars, Tholons said.

Vietnam and Indonesia, meanwhile, have established themselves as strong providers of IT services, Tholons said.

“As confidence and maturity builds, process and delivery innovation will thrive as well. Tholons sees this as necessitating Southeast Asia’s smooth transition up the services value chain,” the document read.

The local BPO sector is expected to have booked $11 billion in revenues in 2011, then to grow by at least 20% from this number by yearend, the Business Processing Association of the Philippines previously said.

By 2016, the sector is expected to deliver $25 billion in revenues, after recording $9 billion in revenues in 2010. —

Source: BWorld Online

Infosys BPO Limited, the business process outsourcing subsidiary of Infosys Limited, announced the signing of a definitive agreement to acquire all of the outstanding share capital in Australia-based Portland Group Pty Ltd, a leading provider of strategic sourcing and category management services. The acquisition is expected to be completed by early January 2012, subject to certain closing conditions being met.

Capita buys Salmat Speech Solutions. The IT services business of Capita has acquired Salmat Speech Solutions’ UK operations for an undisclosed amount as it follows up on a busy M&A period during 2011. Salmat, which is headquartered in Australia, provides services to customer service operations to improve delivery, reduce costs and enhance security through voice recognition and voice biometrics. As part of the deal Capita has also entered into an agreement with Salmat which will see the London-based business process outsourcing (BPO) provider to use the ‘advanced product set’ available from the Australian business. Capita says this will create a route to market for the UK and EMEA region.

From the Editor’s Desk
Martin Conboy, President – Australian BPO Association (ABPOA)

Well here we are then. It’s 2012 and it’s a new blank piece of paper – well not really as we have a lot of things in the pipeline.

So welcome back to work and if you have been in Sydney you might be grateful to be back at work. We have had a very ordinary holiday season as we have had the wettest summer in something like 50 years – thanks, La Nina.

We have lots of good stories this week and as you can see from our snippets, we have some consolidation happening in the sector.

The good news is that it looks like the US may avoid that double dip recession as all the economic indicators are heading in the right direction, although Europe’s path is still not clear so fingers and toes crossed as we march forward.

As I write there are two days of data capture left on our Australian BPO study, which we will be launching in February with our sponsors IBM & Fuji Xerox. If you are a ‘buy side’ BPO player and you are in Australia you might like to let us know what’s going on inside your firm. Please visit http://valuenotes.co.in/survey/index.php?sid=47518&lang=en

Your opinion counts and we will give you a free executive summary if you fill in the survey, plus put you in the draw for a brand new iPad2.

I will be sharing the results at the COPC event on Feb 8th in Sydney (Ian Aitchison CEO, COPC – Mobile +61 423 021 291 – if you want to come) and the Law Institute of Victoria conference on Feb 28th in Melbourne.

With our sponsors we will be having an Australian road show and will let you know the dates when we have finalized them.

Another very exciting bit of news is that in conjunction with UK Outsourcing magazine, we are taking a BPO tour group to the Philippines in late March.

We will be visiting Clark/Subic, Manila and Cebu. The Tour starts on 23rd March until the 1st April. It is an action packed agenda, and if you ever wanted to know what the Philippines BPO industry is all about then this is the tour for you. We are going to sneak in a couple of games of golf as the courses in the Philippines have to be seen to be believed. It’s five-star all the way and we have had a fair bit of interest from as far a field as South Africa, USA, UK and Australia, so do yourself a favour and come on board. http://thesauce.net.au/2011/12/calling-for-expressions-of-interest

Another world first initiative this year will be a 10-page Philippines supplement that we will be producing with UK Outsourcing magazine for their May/June issue. So if you are interested in promoting your BPO business to the world then let us know so that we can send you the media kit. This will be a big piece of quality journalism and will really help to put the Philippines on the map.

Last but not the least is the Australian BPO Association (ABPOA) Annual General Meeting in late February. It’s hard to believe that the ABPOA is just over a year old and now starting to get a head of steam. We are looking for new members and new office bearers and even a new President if anyone is interested in putting their hand up. This is your chance to lend a hand and make a difference

That’s all folks and here’s to a successful year to all of us.

By Mark Atterby – Senior Staff writer

In terms of managing fast changing technology configurations, new channels and consumer behaviour for interaction channels such as social media and smart phone apps, most BPO vendors are completely stunned like rabbits caught in the headlights of an oncoming car and it could get messy.

The role of voice as the primary channel for managing customer relationships has moderated and as they say the future isn’t what it used to be. Unfortunately, a large part of the industry hasn’t kept up with the speed of change and a number of BPO vendors may suffer.

The future of customer interaction channels has changed! But more importantly – is the BPO industry ready for it?

Who has not heard the story of a customer calling a Telco and being stuck on the cursed IVR queue for ages and then tweeting about their poor experience (Did I mention using a loud hailer to the world?) and getting immediate attention from the Telco. Many players do not have a strategy for dealing with this type of customer reaction.

Even prolific channels such as email and SMS have had their day.

At present, text messaging is the most ubiquitous data solution in the mobile industry. But the market is saturated and growth has plateaued. Smartphones are generating tremendous growth with applications and mobile access to online services.

As applications become slicker and more sophisticated and the average personal use of video intensifies, smartphones are placing increasing demands on available carrier capacity. And rather than using SMS, consumers are increasingly using Facebook, Twitter, and Skype and the messaging and chat facilities within these applications to communicate and share information.

Email had a number of advantages over existing forms of communication such as phone calls, letters and faxes. It was fast, cheap, convenient and the receiver could deal with it when it suited them. Email’s greatest strength has proven to be its greatest weakness: anyone can send an email to anyone, practically free. In other word it makes it easy to SPAM.

One of the best ways to combat spam is to only accept messages from people you know. This has encouraged many people to embrace services such as Skype, Windows Live Messenger, Facebook and Twitter as alternatives to email, especially as most non-work messages are sent to family and friends who are probably also using these other services.

For today’s Gen Y social networking users, having grown up with the convenience of SMS and instant messaging, traditional email is often seen as too formal, cumbersome and slow, just as those who grew up with email might view the telex machine, fax machine or handwritten letter.

Facebook has about 800 million active users, of whom more than half log in daily. Together they send 4 billion internal Facebook messages every day.

Teaching old dogs new tricks

According to Ventana Research customers now interact through a greater variety of channels. More people and systems across the enterprise handle interactions (not just the call centre) and customers want to interact while they are mobile at a time of day that suits them. Recently, the introduction of the iPhone 4 led to customers doubling the amount of data they use to access an increasing range of online services.

The evolution of these trends is challenging the very notion of the outsourcing industry. Chris Luxford, President, Aegis Services Australia, comments, “If you look at any industry whether that is banking, food production, transport and logistics, everyone to some extent is an outsourcer. Yet we have these terms such contact centre outsourcer or back office services provider. I prefer the view that we provide products and service that help organisations ensure they deliver the best experience possible to their customers.”

Its true that BPO organisations need to move beyond the notion of being a provider of voice services or a provider of back office admin services and take a more holistic approach to the customer and how they interact with an organisation. They need to come to grips with the voice of the customer, regardless of channel. It’s about helping organisations influence the outcome of interactions by taking action as the interaction is taking place.

Luxford concurs, “We need to look at the holistic customer experience and in order to do that BPO organizations need to consider themselves not as a (front office) voice company or a back office company but put themselves in a position where they are the voice of the customer. “ Luxford believes BPO providers will need to invest significantly in new technology, not just in purchasing or implementing solutions, but they will need to invest in their own R&D to stay relevant and competitive.

Though it’s not an easy task, some organisations are investing and are making greater use of cloud-based solutions to support interaction handling. “There are many challenges and opportunities presented by the operation of cloud computing-based contact centers to maximise their accessibility,” said Richard Snow, VP & Research Director of Ventana Research. “As companies increasingly look to service customers more efficiently and across the Internet, using a cloud-based contact center model will enable customer service support anywhere in the world. The home or internet-based agent has become a practical reality with new applications and technology.”

The voice channel as well as email and SMS will always remain important however they must be placed in context with all the other customer interaction channels. To understand the voice of the customer on behalf of their clients BPO providers must engage and up-skill their knowledge around social media platforms and mobility and recognise the impact of the social networking revolution or be dis-intermediated as they most certainly will get bypassed.

Investment in the new technology as well as new processes to ensure the best outcomes at the time a particular interaction is taking place is part of the new normal.