Marketing hindering the growth of BPOs

August 27, 2008
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, NAIROBI, August 18 – The advent of new technology and demand for increased efficiency among small and large organisations led to the birth of Business Process Outsourcing (BPOs).

At the international level BPOs have evolved over the last ten years, while development of the Kenyan market is only about three years old. Global BPO giants include fast-growing markets such as India, the Philippines and China.

According to Gilda Odera, the Chairperson of the BPO Society of Kenya, and Managing Director of SkyWeb Evans, one of the numerous BPOs operating in Kenya, any organisation that outsources its operations such as accounts, payroll or any back office work to another company is simply giving work to a BPO.

She says there are about 40 BPO companies offering various services to local and international organisations.

Though BPOs, especially call centers, were picking up at some point mainly targeting international markets such as USA and UK, many of them have wound up lately for lack of business despite the sector being touted as one of the pillars set to drive Vision 2030.

This scary trend has seen the BPO Society up its lobby for the government to vigorously market Kenya as a BPO destination.

“Kenya has excellent skills; human and technology-wise to make the BPO sector thrive,” Odera emphasises.

Kenyan BPOs, she adds, are run more professionally unlike their Asian competitors. “Kenya entrepreneurs will strive to run a BPO on the best internet platform, software, and backup systems combined with excellent human skills, standards that are much higher than what is found in India and the Philippines.”

However, high bandwidth costs have continued to affect BPO operations in Kenya. An outfit with just 10 stations pays about US$ 6500 (Sh440,000). “A center running 20 stations ends up spending up to Sh 1 million a month on bandwidth,” she laments.

In addition, the bandwidth support programme between the government and the World Bank, which was expected to reduce costs as an incentive to grow the sub-sector, is yet to be implemented. 

Under the partnership, BPOs would be paying only 10 percent of bandwidth costs, while the rest is passed on to the government.

Efforts to have the fiber-optic cable laid down by next year will definitely reduce such high costs of bandwidth in addition to increasing clarity of voice for call centres, knocking out the use of the satellite, which sometimes messes up voice communication.

Other African countries where BPO businesses have been picking up include South Africa, which Odera notes that Kenya has a better cost advantage in and Ghana which Kenya beats in terms of language (better English for communication) as well as cost. Others include Uganda and Egypt where the interest in investing in BPOs is fast catching up.

Though marketing and high cost of bandwidth are the two main challenges, Odera explains that BPOs need to train their personnel, insisting that basic training is a must to keep the employees abreast with some of the social trends of some of their international clients.

Already the Kenya College of Communications Technology has introduced some courses targeting those who want to work in call centers.

Odera says the ICT Board, which should market Kenya as a BPO destination, will have to change the perception of the international market, which was further eroded during the post election violence.

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