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BPO - Are we milking a dead cow, a layman's view!!
Ric dees
#1 Posted : Tuesday, September 27, 2011 5:09:38 PM
Rank: Member


Joined: 3/6/2008
Posts: 632

BPO - Business process outsourcing is a name that is thrown at every ICT forum and cited as the one of the sectors that will drive this economy to the stars.

Forgive me for being a pessimistic but it's been over 10 years now since the first BPO Center was set-up in Nairobi and can we quantify or draw a trajectory on how this has performed or influenced the market? From a layman's point of view i believe we should have graduated from the Front-0ffice outsourcing bit ie: call centers to back office functions ie HR, Accounting and Finance.

Unfortunately this industry is hugely reliant on UK/US markets and what happens when this markets take a hit? would it be prudent first to dominate the local industry (In-shoring/Nearshoring) then we can cut our teeth abroad (offshoring). I know for one the call center market is dead coz when i turn on my TV and look at the businesses advetising their services one of the guaratees they give is "UK based call centeres" and UK experiencing an all time unemployment rate and esp EU identfying N.Wales as a low economic/migrant region it serves as a perfect setting for this industry to grow there.

I have not heard bout KPO's and indeed LPO's a decade later and all i hear is we have a huge labout force (can't really compare with India) and our abiltiy to speak the English language which brings about the issue of Atrition - we will continue having high turn-overs in this industry as graduates will soon move once they getter "better" jobs and i have not even touched the social problems ie Sex/Alchoholism brought about working on ungoldy hours for long durations
then you can see it's not the magic wand it's touted to be.

I think this was a great idea THEN but trends have changed America is now an AA+ economy and the UK only 20% of the working population are able bodied and white under 45. Times have changed i think we need to rethink this BPO hullabaloo i'd be interested to see which company will outsource it's non-core functions as the current climate.

However this are just my views @Djinn and other IT gurus please tell me am wrong!!

The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday's logic.
Mtu Biz
#2 Posted : Tuesday, September 27, 2011 5:22:05 PM
Rank: Veteran


Joined: 1/16/2007
Posts: 1,320

I concur.

"milking a dead cow" lol
Sola Scriptura


KenyanLyrics
#3 Posted : Tuesday, September 27, 2011 7:28:16 PM
Rank: Veteran


Joined: 4/16/2010
Posts: 906
Location: Nairobi
The reasoning behind the Kenyan BPO hype was sound, but every time I hear someone talk about it, I realise that they fail to recognise what we are up against. Its as if Kenyans assume that the multi billion dollar Indian corporations would just hand over their clients.
tajiri
#4 Posted : Wednesday, September 28, 2011 9:45:57 AM
Rank: Member


Joined: 9/28/2007
Posts: 44
@ Rickdees, that is spot on, unfortunately no technocrats in government see this. They are too busy speculating on land in the new areas or registering companies that they sell on. We can't offer the same old service that nobody wants. That reminds me of the the EPZ con. Our biggest problem is burying our heads in the sand with inability to recognise our weaknesses. The following reasons explain why we can't hack it in BPO.
1. Setting up a 'technocity' rather than lay infrastructure. The Malili project is overly priced, fraught with corruption, way behind schedule and relying on europes and Americas needs of the 2000's. Cost of business will be to high, high labour costs, high broadband and power prices.
2. Poor computer penetrance, teachers with little computer training, lack of teachers or middle level colleges.
3. Salaries in Kenya are too high compared to India, Egypt and philipines. They ca do it better and cheaper than us.
4. Theft by employee, corruption lack of governance. Cavalier attitude of Kenyan employees with our usual annoying bravado.fraud!!
5. IT training and school curricular is not fit for purpose. The strategy of our training is wrong.
6. Like tourism, this may not translate to economic development as the owners of the companies will be European or american. Tourism industry has turned Mombasa into a slum city with no rise in the middleclass. Arise Malili next on line...
Finally the government should provide infrastructure and leave business to the private sector. Corruption and lack of ideas with self interests are a hallmark of our country. Infrastructure/ development is not buildings.
Ash Ock
#5 Posted : Wednesday, September 28, 2011 10:48:57 AM
Rank: Member


Joined: 8/27/2010
Posts: 495
Location: Nairobi
This following article, written earlier this year, seems to sum up this issue in an interesting way:

http://kumekucha.blogspo...nd-enslave-africans.html
Sent from my Black Nokia 3310
Wamutonyi
#6 Posted : Wednesday, September 28, 2011 12:01:50 PM
Rank: New-farer


Joined: 1/4/2010
Posts: 93
If you can still milk, then the cow is not dead.
Mr.Wambui
#7 Posted : Wednesday, September 28, 2011 2:06:24 PM
Rank: Member


Joined: 9/14/2011
Posts: 132
Location: Darasani
Wamutonyi wrote:
If you can still milk, then the cow is not dead.

I concur, i.e if you're getting some milk.
All you can do is all you can do; but all you can do is enough!
KenMan
#8 Posted : Wednesday, September 28, 2011 2:18:31 PM
Rank: New-farer


Joined: 7/14/2011
Posts: 13
Wamutonyi wrote:
If you can still milk, then the cow is not dead.


Maybe it's a bull they're unwittingly "milking"...
AmHere
#9 Posted : Wednesday, September 28, 2011 2:32:37 PM
Rank: Member


Joined: 7/7/2009
Posts: 93
The market is there but as long as focus is on 10-million-dollar contracts and trying to replicate India, we are guaranteed to fail. Tapping BPO requires research, niche identification, hard work, consistent quality control and excellent customer service just like any other business.
jasonhill
#10 Posted : Friday, September 30, 2011 3:59:32 AM
Rank: Member


Joined: 1/22/2011
Posts: 322
Location: Chicago, IL, USA
BPO could be a successful reality in Kenya, especially with cheaper and more reliable internet access for data and voice of IP, but there hasn't been, from what I've seen, a serious effort by any Kenyan company to build a world-class call center, and then to properly court prospective clients in countries and environments where such services are needed. The saddest part is that it isn't expensive to do so- a lot cheaper than building just ONE high-rise building in Konza.

Tajiri has pointed out some spot-on problems that need to be addressed, but none of them would stop a Kenyan call center, oops, I mean "centre" from being successful. Those issues simply aren't show-stoppers if properly planned for. India has the same issues (except for the salary issue of course, and I don't think that's an issue. Salaries for call center positions are, from what I've seen, higher in India than in Kenya when cost of living is taken into account.)

I can tell you that even with the US and UK economies having trouble, and with high unemployment, there is no slowing of offshoring jobs and BPO functions. In fact, with credit tight and companies looking to make their money stretch as much as possible, outsourcing is still very much in play.

Best,

Hill
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