Thought leadership

OPINION: How a global pandemic highlighted SA’s BPO strengths

September 11, 2023

JOHANNESBURG – In recent years, South Africa has established itself as a prime location for outsourcing services for global organisations operating across industries and sectors – just this month, the country was named the second most favoured offshore location for contact centre delivery globally for the second year in a row, behind India and ahead of the Philippines, according to Ryan Strategic Advisory’s annual 2020 Front Office BPO Omnibus Survey.

Recent social and economic challenges presented by the Covid-19 pandemic have further highlighted the country’s strengths in terms of offering significant potential for businesses through Business Process Outsourcing (BPO). Essentially, the local BPO industry is facing the possibility of major growth and opportunity in a post-Covid world.

In my experience, there are some circles of thought that suggest that South Africa is untried in terms of outsourcing to specific regions, lacks the infrastructure to deliver the same level of stability as other destinations, lacks government stability and support, and has a large but untested talent pool.

The reality, however, is far different. When you do a comparison on the key needs to support a successful outsourced operation, South Africa is well positioned to provide these. In fact, in most cases, the country is at a far more superior level than other BPO regions in this regard.

South Africa has been a key BPO destination for the UK for many years, has seen recent success with Australian brands and is becoming a destination of choice for US clients alike.

While most regions are not immune to government stability or lack of support from local, regional and national government regarding the BPO industry; the recent focus on keeping the BPO sector operating during the national Covid-9 lockdown when most other key regions (including India and Philippines) experienced shut downs is evidence of this support in South Africa and demonstrates that the local
government understands the potential of the sector.

The country’s large talent pool is wide ranging in terms of age, race, cultural affiliation, language, and skills set. The local contact centre industry currently employs around 260 000 individuals, and according to BPESA’s fourth quarter 2019 results, general BPO and contact centre services accounted for 22 percent of total new jobs created within the period.

Additionally, 85 percent of those employed by the sector in the fourth quarter were between the ages of 18 and 35, which is both encouraging and important in a country with a youth unemployment rate of 53 percent.

Job creation is going to become critical for economic recovery post-Covid and the expected growth in the BPO industry means it is well positioned to play a positive role in this regard.

The introduction of best practice and digital recruitment platforms, which incorporate behavioural profiling, can assist businesses in understanding how this talent pool can work best in terms of their specific needs.

A Merchants survey carried out this month, which sampled 2000 respondents from across the country, found that problem solving ability was the most sought-after quality a contact centre agent should possess.

This was followed by personality, knowledge of products and services, sense of urgency, and empathy, respectively.

While customers often point out the empathy of South African agents and their ability to understand the client concerns and problems, which results in an improved customer experience, I believe the ability of local agents to understand a problem, analyse it, develop resolution options and then implement these steps is what truly sets the country apart in terms of its BPO offering.

This problem solving ability is certainly driven by the wide range of talent available and is the reason that South Africa has a reputation for delivering superior customer experience scores when it comes to Net Promoter Scores (NPS), Key Quality Scores (KQS) and First Contact Resolution (FCR).
When you add the fact that the country offers world-class facility builds, first world infrastructure, and cost attractiveness that is on par with other large BPO regions, it is clear that South Africa has a unique proposition that certainly sets it apart from other regions.

In a post-Covid world, outsourcing and offshore delivery will shift toward a stronger focus on operating models that offer additional or alternate delivery options, and move away from single region strategies.
Given its superior delivery capability, South Africa will become a strong focus for businesses looking to outsource. The country has also shown a stronger ability to develop operating models that provide continuity solutions to businesses, including Work from Home models, increased office continuity and community-based operations, when compared to other BPO regions. The current pandemic has highlighted the key benefits this ability provides, as local contact centres can remain operational with minimal impact.

Further, a number of initiatives currently underway by key industry bodies, the government and BPO providers mean we can expect to see South Africa leading the way in the next five years when it comes to offering business continuity to clients, continued skills development opportunities for the talent pool, the use of the latest technology to provide positive experiences for agents and end clients, and the delivery
of world-class BPO facilities. Essentially, South Africa is well positioned to become the BPO delivery region of the future.

Author: Mathew Conn, group chief revenue officer of Merchants.
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