India is the undisputed champion in offshoring but this dominance is not set to go unchallenged much longer.
The country’s success has caught the attention of other nations looking to boost the prospects of their well educated work forces and, for the first time, India now has a mounting level of stiff competition from countries that one would not normally have associated with offshoring.
One such relative debutant is South Africa. The republic has a long history of colonial rule by the British which has led to strong trade ties with the UK which gives it several advantages over other offshore locations, according to Martin Dove, Regional Managing Director of offshore outsourcer Merchants, which works with Carphone Warehouse and Asda.
“Obviously there is the long history of association with the UK so South Africa benefits from highly educated work force that speaks English fluently,” he points out.
“This also means, though, that South Africans just simply ‘get’ British culture. They watch the same shows, they’re in to the same sports, so that’s just so useful, it’s something that can’t be taught. South Africa being on the same time zones is obviously a benefit too for customer service and communications with our clients.
“The country can’t compete on cost with India, but, I believe, it is starting to appeal to companies that want to pay a bit more for a better quality service.”
Dutch not so easy
Surprisingly Dove points out that whilst the country’s past makes it ideal for English speaking customer services, the same does not readily apply to Holland, despite the country being colonised by both British and Dutch settlers.
“There is not as good a match between South Africans speaking English and the UK as there is between Afrikaans speakers and Dutch,” he elaborates.
“The only barrier with English is rounding off the accent a little but Afrikaans is not as similar to Dutch as you would imagine and it takes a good six weeks or so of training to get an Afrikaans speaker speaking Dutch well. It’s a problem some big multinationals have come across and been surprised by.”
India’s main rival
Despite the fit between South Africa and the UK there are only 80,000 working in offshoring in the country, a figure that would be swallowed up easily within the ranks of the top ten Indian offshoring companies.
The country that is widely accepted as posing the greatest threat to India is just a couple of time zones away to the East. Due to past American colonisation, the Philippines, with a population of 87m, is the third largest English speaking country in the world. It has a highly educated work force and excellent telecommunications infrastructure making it a viable alternative to India for business process and IT outsourcing, according to Jed Mooney, Managing Director of BPO company, Datahold, who claims its offshore base in Manila can process data for UK companies with savings reaching up to 70 per cent.
He claims that with an annual supply of 385,000 graduates and a further 70,000 IT trained specialists, the Philippines is set to be a serious contender for India’s previously unrivalled offshoring dominance.
Source: MediaPlanet
Publication Date: December 2006