There are essentially 3 periods for offshore industry.

Honeymoon Period (until 2003)

Call centre companies are currently experiencing a honeymoon period with their shareholders, employees and Governments. For vendors in these offshore locations, finding good quality staff is easy. Any industry seen as a growing industry encourages an abundance of employees especially when it is seen to be part of “developed world”. Investors are still investing large sums of money into call-centre ventures even though it is not clear when they will start to see a return on their investment.

Decision Time (2003-2005)

Decision time is already starting on a small scale. Companies are starting to ask following questions:

·Is offshore outsourcing for my business? ·Which types of work should I be outsourcing? ·Where should I outsource? ·Should offshore outsourcing be part of my strategy or simply a tactic to fulfill a short-term requirement?

An economic recovery limiting availability of agents in developed countries, and continued downward pressure on costs will fuel growth of offshore industry. Governments in Asian countries will continue to develop new initiatives to encourage call-centre investment. A number of Indian owned companies will go bankrupt, sell their facilities or merge with foreign partners. A number of these will go bankrupt as a direct result of their over-investment in costly IT infrastructures, which are too expensive to maintain with margins, which will be increasingly tight. The interest in accreditation bodies such as COPC will continue to grow in developing countries but this will be short-term as clients and vendors fail to experience promised benefits.

Consolidation (2006 - )

Growth will slow and it will very difficult for new companies to obtain a significant market share. Some call-centres will start to set up in more remote areas. Less and less centres will be set up in Manila, Delhi, Bangalore and Mumbai as centres look to reduce costs further to maintain their competitive advantage and compete against their rivals who are continuing to drive down margins. The size of each vendor will be substantially larger than now but there is likely to be less vendors. These vendors will operate in a number of locations and possibly across international borders.

Conclusion

There is a very rosy future for offshore call centre industry but it will not grow as fast as many have anticipated and quality will become far more of an issue than at present. Poor quality call centre companies at home and abroad will face extinction within next 3 years. The market will become more sophisticated and level of management will slowly improve over medium term. My advice to call centre companies would be to remain focused on quality and not on over-rapid growth or expensive marketing campaigns. Vendors with good reputations will be sought out. Focus on what you are good at and bring in areas where you lack. My advice to customers and potential customers of offshore companies is to keep your eyes open. Many of companies with account management teams in London and New York often do this at expense of quality ex-patriot management in their operations. Use multiple vendors in multiple countries and constantly evaluate all areas of their service. Be patient and you will reap rewards. To call centre companies in The United States and United Kingdom, I would say, “Move up value chain. We can’t make widgets as cheaply in U.K. as they can in China so just give up and do something that they can’t do as well in China.” Finally, my advice to technology companies such as Avaya and IBM would be “Keep to making boxes and stop trying to over-hype industry in order to sell more of your equipment. The success of offshore call centre companies will be driven by their ability to successfully manage high quality call centre projects and not by size of their equipment or their debt mountain”.

This articles was written by Rob O’Malley of Asian Call Centres, a leading offshore vendor of call centre services.

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