South Africa hosts offshore customer management international conference

In addition to attending the conference, delegates will visit contact centre and BPO operations in three of the country's major cities, Cape Town, Johannesburg and Durban.

The decision by conference organisers, ICT, to hold the conference in South Africa signifies a growing recognition of the country's presence among the first rank of offshore locations for western businesses. To date more than 30 companies have established contact centre and BPO operations in South Africa, either as owned operations or via outsourced service providers, creating a £60 million (R700m) industry. Continuing Government commitment and the deregulation of South Africa's telecoms industry in February 2005, is expected to fuel growth rates of 40% per annum over the next three years.

"There is much to attract international buyers to South Africa," says Christina Wood, Event Director with ICT. "High unemployment (35% nationally) means a large, well educated labour pool, stable salaries and low staff turnover. Levels of English literacy are high, property costs are low and the quality of facilities and support services is excellent. But perhaps South Africa's greatest strength, is its business culture, which closely mirrors that of the west and, particularly, the UK. This not only means that companies find doing business in South Africa reassuringly familiar, but that the agent workforce is able to empathise easily with the demands and expectations of the western consumers they speak to."

South Africa's contact centre and BPO industry also has substantial Government support. In his 2003 State of the Union Speech President Thabo Mbeki announced that it would be the target of focused action to develop its potential, as part of the Government's micro-economic reform programme. This has led to substantial grants being made available to international businesses and their service providers, primarily to fund skills development and training.

However, according to Zoliwe Ntungo, BPO Unit, Department of Trade & Industry, the most significant Government intervention has been the recently announced plan to deregulate the country's telecoms industry on 1 February 2005. After that date, value added network providers (VANS) will be able to carry voice traffic over their internet networks. Until now they've been restricted to carrying data, an activity already deregulated. Prices are expected to fall rapidly into line with those of other low cost offshore locations. "Under the terms of the monopoly South African contact centres have found it hard to compete with international telephony costs offered by other lower cost locations," says Ntungo. "But, despite that, we've been seeing year on year growth of 25% in the industry. We expect growth to accelerate dramatically as the effects of deregulation are felt."

"South Africa," she concludes, "appeals to international buyers who recognise the importance of delivering a service experience in line with the expectations of western consumers. We are principally focused on the quality end of the customer management and BPO market, and are proving our ability to manage complex, customer-facing processes in highly sophisticated and regulated industries, such as financial services. For example, a high percentage of South Africa's international work lies in high value outbound customer calling associated with service and sales, data capture and, in the financial services sector, policy origination and renewals."

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