In my last column (June 6), I featured an abbreviated version of a Call Center Industry study written by Robert O’Malley, COO of Asian Call Centres Inc. This article concludes with the critical factors to success in the business.
Critical to call center business
English: The overall positions haven’t changed much. The Philippines remains firmly Number One but has moved even further ahead of India. Malaysia has failed to live up to its early promise and is now attempting to reposition itself as a Pan-Asian center. Sri Lanka moves up to third position bolstered by the Tamil Tigers ceasefire. China has moved up considerably after a year when it joined the WTO and won the Olympics, but it is still wholly unsuitable for English-speaking call center work.
The Philippines has moved even further ahead of India even though India remains at Number Two for this section. There has been a lot of criticism about strong accents in India and how the agents in some Indian vendors have been unable to have a complex conversation in English with Americans or Britons. Because of the dominance of English in the Philippines, the agents here think in English and have a neutral accent.
As the market in both of these countries is set for triple-digit growth over the coming years, it will become more clear as to whether this puts a strain on the number of "perfect English" agents in both countries. However, it seems clear that the Philippines will be able to move up the value chain far more easily.
Quality of available agents: Across Asia, the perception of the call center agent’s position varies from country to country. In wealthy countries such as Japan, South Korea or Malaysia, the range of other career opportunities severely reduces the quality of people willing to work in a call center environment.
The pool of good quality people willing and able to work in offshore call centers can be found in the middle pack and it’s no surprise that these countries are at the top of the overall rankings. Countries such as Sri Lanka, India and the Philippines have a rich source of good quality people able to work in call centers. The difficulty posed in India is that they are spread out over a wide range of cities whereas Manila, and to a lesser extent Colombo, have what seems like a limitless number of quality call center agents available.
In contrast to other wealthy countries, Singapore and Hong Kong both rate quite highly. These two countries have both invested quite heavily in their educational systems and in normal circumstances, the educated pool would be working in the export-led industries that have shaped their economies. However, a downturn in the United States economy has raised unemployment particularly in Hong Kong. In Singapore, the large number of immigrant workers from the Philippines and Indonesia increases the wealth of talent.
Costs: There can be no doubt that the main driver for moving call center work to offshore locations is the desire to drive costs down. Unfortunately, the countries with very low cost bases in Indochina are unsuitable in other criteria for call center activity.
Although China has generally cheaper labor cost than many of the countries higher in the rankings, the cost of employing people-oriented people who are fluent in English is actually higher, reflecting their limited availability. Other factors which have influenced this include the cost of real estate, telecommunications, etc.
Telco: It’s no surprise that the best telecommunications networks are in the richest countries. For the countries seriously involved in major offshore call center work, there is a different picture.
The two largest markets – India and the Philippines – have made major improvements in order to meet the growing demand. However, the Indian telecommunications industry still requires major improvements to be able to achieve consistent quality. It should also be noted that these results only apply to the major cities. In the Philippines, only Metro Manila has sufficient infrastructure. Even cities such as Cebu lack the required infrastructure. It should be noted that telecommunications is considered a relatively insignificant issue in terms of location selection. As long as the infrastructure meets a certain level, companies are far more interested in looking at other factors such as the quality of people, their English and the associated costs of doing business there.
Stability: Much of stability is about perception and this year saw a major issue impact the offshore industry. The crisis in Kashmir, which led to one million troops at the border with Pakistan and subsequent travel warnings from the US and UK, shook the offshore industry. In reality, it only had a short-term impact and companies simply shifted work they were going to place in India to the Philippines. There have been absolutely no reports of any business being impacted because of terrorism. Some countries such as Sri Lanka, the Philippines and China are now seen as more stable than a year ago but countries such as Pakistan, India, Malaysia and Indonesia are considered high-risk areas. However, it should be noted that many of the most stable countries are at the bottom of the overall standings.
Support services: Successful call center locations are based on a good network of support services covering all areas of call center set-up and management. These services tend to follow the money, that is why the advanced economies are at the top of the list. It’s no surprise that the quality of the support services in both India and the Philippines has risen dramatically. There are now a lot of companies trying to fill the void. The lack of quality support services in other countries could well become a barrier to entry for many potential vendors of call center services. The only other country to improve its ranking is Singapore which may be in part due to the Call Center Council of Singapore (CCCS) which has been looking to establish standards across the industry.
Management: The quality of middle management has come in for some major criticism. In reality, this only really applies to India where the industry is now unable to find suitable middle management to staff its centers. As the market grows, the problem seems to become more acute. One advantage the Philippines has is that it has a higher number of ex-pats working in its centers due to the fact that the Philippines has a lifestyle friendlier toward Westerners. The quality of management available in advanced countries is very high particularly in Japan.
Abigail K. Yap is the CEO of Active Business Solutions Inc. (/a/b/s/), the parent company of Asian Call Centres Inc. and a member of Yapster e-Conglomerate Inc. You may contact her at info@activebusiness.com.