When the Rubber Meets the Road…Sustainability and Social Responsibility in Global Sourcing

WandaBy: Wanda Lopuch, Chair, The Global Sourcing Council

“The Next Generation of Investors Seeks Purpose Alongside Profit” – was the headline for the The Guardian on Feb. 12, 2014 . I cannot wait to see similar headlines regarding ITO/BPO sector in any one of the major publications, perhaps “The New Wave of Global Sourcing Seeks Purpose Alongside Profit”.

We are not quite there yet…. In global sourcing, I have argued that social responsibility is a generational issue (http://gscouncil.org/from-the-desk-of-the-president-2-2/). These generational differences couldn’t have been more visible than during The World BPO/ITO Forum (WBPO Forum) in New York City on June 2-3, 2014, when the GSC Executive Development 3S Boot Camp© participants entered “the real world of global business”.

The WBPO Forum in the last seven years has been a prestigious place where global experts share insights on the trends and shifts in the BPO and ITO space, and where buyers and sellers of services meet in a friendly environment.

This seventh World BPO/ITO Forum program incorporated a variety of topics: from technical discussions on cloud, smart sourcing mix, automation, and vertical integration, to broader business questions addressing value creation through IT, creativity in business or value proposition of impact sourcing.

The GSC 3S Boot Camp©, held in New York City from May 29 through June 3, concluded the 2013 GSC 3S Awards program. It was attended by the winners of the 2013 GSC Awards in Sustainable and Socially Responsible Sourcing: accomplished social entrepreneurs and experience business executives, as well as students of the Sustainability Programs at the Stony Brook University in New York.

Attendance at The WBPO Forum was the true test
for the “rubber meeting the road”.

Attending The World BPO/ITO Forum was an integral part of the GSC 3S Boot Camp© because participants practiced their newly acquired skills in communication and influencing the thinking of other WBPO participants, and networking while learning about the new developments in the cloud, crowd sourcing, robotics, risk-assessment and vendor-buyer relationship management. The Forum was the true test for the “rubber meeting the road”.

The GSC 3S Boot Camp© discussions and simulations incorporated a variety of cultural, managerial and generational perspectives. Though the students lacked the depth of managerial experience, they contributed invaluable insight into communication processes; especially as the Gen Y / Millennials are both current and future consumers and producers of goods and services. The GSC 3S Boot Camp© participants were generously rewarded for their contributions by fully-paid internships to study sustainability at the JSW Group headquarters in Mumbai, India. JSW was the winner of the People’s Choice Award at the 2013 GSC 3S Awards.

During the pre-WBPO Forum portion of the GSC 3S Boot Camp© program, where excitement was high, I cautioned the passionate attendees that “it is easy to preach to believers”. As I have argued in the past, the real challenge and the real satisfaction, comes from reaching out and open a dialog with “nonbelievers”; that is, those who do not see what you see or who reject your perspective.  Real results come from challenging the status quo, and merging different perspectives, that can create the best business outcomes. (See: http://gscouncil.org/from-the-desk-of-the-chair-abandoning-csr-silos/). As participants nodded with skepticism (reminding me that ignorance is bliss), I could see that they had not envisioned how challenging their time at the World BPO Forum could be, when they would experience, first hand, the varying degrees to which social responsibility has been adopted in the BPO/ITO sector.

The true test of how the BPO/ITO sector adopts social responsibility and sustainability as business values, took place during the Speed Networking Session during the first day of the WBPO Forum.

Overwhelming the experience, especially of our youngest participants, was in their own words: devastating. Comments following the session included: “THEY did not want to discuss this issue”; “when I asked about social factors in business, THEY said that it is not their area”. One passionate intern stated: “THEY simply do not care”; while another less frustrated intern admitted: “Only those on the “Impact Sourcing Panel” wanted to talk about values“.

Real results come from challenging the status quo.

Yes, it is easy to preach to believers… but there is the whole other world out there.

Many reasons contribute to why THEY left the impression of not caring or ignoring social issues in business. However, THEY were not the only opinions presented at the WBPO Forum. Here are three other voices:

1. Marv Adams, the COO of TD Ameritrade, in his Keynote presentation on “Seeing Systems – the Key to Agility” walked the audience through the complex world of risk assessment scenarios in agile organizations. Marv clearly pointed to corporate values as guiding principles in the case of uncertainty. Social risk, Marv said, is typically the domain of the C-Suite, not the operations management.

During the Speed Networking Session, “THEY” were probably operations executives entrusted with operational and/or infrastructure tasks. THEY reflected their universe of priorities: cost, on-time-delivery, reliability etc. THEY were not the Marv Adams’s of the BPO space.

This is, however, as far as I will go with excuses for my operations colleagues who have not acknowledged the importance of social values in business. In his opening statements, Marv emphasized that in a modern organization, everyone needs to embrace organizational values. So, the response to “It’s not my area” only demonstrates, that an organizational inertia or a Vision/ Mission disconnect is impacting real attitudes and behaviors, with the consequence being that corporate values preached by C-Suite executives are not being absorbed into a company’s ecosystem.

I would like to assure our young, somewhat frustrated interns, that there are organizations out there that successfully translate corporate values, including social values, into measurable indicators, which are effectively filtered down the organizational layers. Ameritrade and ConEdison are two prime examples of getting it right. Organizational inertia or disconnect can be controlled and managed, when a middle manager feels a direct impact on his or her paycheck or career opportunities. So, look for these well-defined, standards-based socially responsible organizations for your careers!

2. Carol Foley, the EVP and Director of Knowledge of Leo Burnett Worldwide, elaborated on differences in leadership styles as the key to innovation. (See: http://bit.ly/1nuRNO1). It is important to recognize that leadership and creativity comes in various forms and shapes – argued Carol; it is only smart to leverage that knowledge to maximize innovation. Carol did not address any IT issues, neither did she use the BPO jargon, yet she has received standing ovation from the WBPO Forum audience. “These are fundamental issues for the industry that suffers from lack of innovation, and is not very forthcoming to admit it” – said Anne Dunkian from Lumiu, thanking Carol for sharing her insight.

There were those in the audience, who made the immediate connection between innovation in outsourcing and the importance of embracing differences as competitive advantage. Diversity is a keyword here. And from diversity, there is only one short step to acknowledging social values in business, in addition to profit.

There were others in the audience, who did not see any connection between their BPO responsibilities and Carol’s pledge to embrace diversity to leverage innovation. Most likely THEY were the same individuals, who “simply did not care” about socially responsible sourcing during the Speed Networking Session.

More than 80% of the Gen Y / Millennials believe that
business should do more to address world problems.

3. During the WBPO Forum, just about every emerging outsourcing destination was represented, each promoting itself by emphasizing the availability of a young and capable workforce that brings much needed talent. Talent availability is one of the key investment factors for global companies. In this War on Talent, winners are the companies who attract talent, develop it, and retain it – just ask Uber and Dropbox of today’s global business.

A young and capable workforce is not the only influencer. The views of young adults are also a prominent factor. More than 80% of the Gen Y / Millennials believe that business should do more to address such world problems as resource scarcity or climate change. And they want to be a part of this solution – according to 2013 Deloitte research.  Extensive research into the Gen Y / Millennials workforce reveals that young talented individuals look first for meaningful work, dignity in the workplace, and the social value that a business creates. Simply, Millennials care and want to work for organizations that care.

This finding has been a cornerstone for the Wal-Mart Global Sustainability Index and its Green & Clean strategy. Recently, Starbucks announced its College Achievement Plan, whereby the company will fully pay college tuitions for thousands of part- and full-time Starbucks U.S. employees, otherwise known as “partners” in Starbucks lingo. This underscores the point of how public companies build long term value for their investors and the communities in which they operate. When positive, socially-geared investment occurs, economic benefits follow.

I predict that the majority of my colleagues who are accomplished operational experts and remain skeptical of social values in business, will sooner rather than later be forced to review their positions. This is especially true when their most valued employees look for opportunities with competitors – those who offer a direct, unbreakable connection between work, profit and purpose.

These three perspectives are only a sample of views and messages during intense WBPO Forum sessions. Are these views just outliers in the kingdom where short-term efficacy prevails? I would like to believe that these sound business views presented by accomplished business leaders are bringing us closer to the tipping point at which the outsourcing industry will accept “profit with purpose” not only as the PR slogan, but as a true business principle.

I am looking forward to next year’s World BPO/ITO Forum, taking place June 16-17, 2015, to see more generational diversity, and with it – more discussion on mobile and social, cyber risk and social risk, crowdsourcing, the meaning of work, and importantly – profit and purpose. Perhaps the headlines in 2015 will capture this shift as well?

Please submit your comments to contactgsc@gscouncil.org. We will share your views with the community.

Editor’s Note – Abundant Acronyms

By: JoDeen Urban, Editor In Chief, The Source

We live in a world where brevity is prized, nanoseconds influence our schedules and 140 characters drive our conversations. Acronyms have assumed an almost titular position in the hierarchy of language. There is an abundance of meaning and substance, however, behind these alphabet-signposts, especially with regard to sourcing and social responsibility.

IS Impact Sourcing, SRO Socially Responsible Sourcing, ES Ethical Sourcing, CSR Corporate Social Responsibility – each term is nuanced and symbiotically linked to improving the lives of those who are poor and vulnerable. Abundance envelopes each term as they refer to the bountiful potential of each and every act, and the prolific continuation of social good.

In this month’s issue, we focus on the immeasurable impact that can be achieved when BPO is effectively combined with Social Responsibility. Metrics only go so far in quantifying socio-economic improvements gained and sustained. There is no tool sensitive enough to measure change in a human heart and mind – yet, it is here that sustainability is nurtured and perpetuated through progressive acts of gratitude.

Wealth does not bring goodness, but goodness brings wealth and
every other blessing, both to the individual and to the state.
Socrates (469-399 BCE)

We all, universally, possess consciousness and free will. They are our most powerful tools to leverage to eradicate poverty and human rights abuses. As each of our contributors point out, the devotion to ideals, persistence to execute social goodwill, and resilience to persevere across cultural, political and generational divides is growing, and going strong. Harold Geneen, who led ITT – the mightiest of all corporate acronyms for decades – said: “I think it is an immutable law in business that words are words, explanations are explanations, promises are promises – but only performance is reality.” Business performance with compassion is now a tightly weaved reality. With regard to SRO, promises made and promises kept are its moral ballast.

We welcome contributors to this publication. Please share your insight and opinions at contactGSC@gscouncil.org, or contact me directly at jodeen@gscouncil.org.

JoDeen Urban
Editor In Chief

JoDeen is an independent management consultant working with established companies as well as start-ups on strategy, organizational capability and business model innovation.

Impact Sourcing: Outsourcing for Social Good?

J Puritt100x100Slideshow photo: Telus International team builds schools from the ground up in Central America.
By: Jeffrey Puritt, President of Telus International

Though its advent still seems quite recent, the outsourcing industry is going through a noteworthy maturation process. For evidence, one can start by looking at India. Best-known as the largest outsourcing destination for the Fortune 500, India’s outsourcing dominance is now being slowly eroded by other regions with young, educated, lower-cost workforces like the Philippines, as well as locations offering multilingual talent like Latin America and Eastern Europe.

More country leaders are realizing the positive aspects that outsourcing can bring to their people and their emerging economies. For example, though poverty is still a major problem in India, wage increases from the booming outsourcing industry of the late 1990s and early 2000s have helped create a large and growing middle class. The same is happening in the Philippines now, with more young people benefiting from stable, in-demand jobs.

But even as the industry enters into the equivalent of middle age, outsourcing still suffers from a long-standing Globe for Purittimage problem. As I write this, there is a bill on the floor of the US Congress to explicitly discourage outsourcing in the call center space. Introduced by Congressman Tim Bishop, the “US Call Center and Consumer Protection Act of 2013,” would bar corporations that send US call center jobs overseas from receiving federal grants and loans. (Editor’s Note: At time of publishing this edition of The Source, no major action has been taken on this bill according to the U.S. Library of Congress. It has been referred to several Congressional Committees in both the Senate and House of Representatives.)

While the concern regarding domestic job displacement and the political debate over outsourcing is understandable, I believe that focusing only on the negative is equivalent to “throwing the baby out with the bathwater.” There is another side to this discussion. What rarely comes up in the outsourcing discourse is that there is a growing segment of the industry that is capable of, and focused on, delivering positive social outcomes, particularly in the developing world.

The Social Benefits of Business Process Outsourcing

In the Philippines, the government actively touts the job creation potential of Business Process Outsourcing (BPO) as one explicit tactic to promote poverty reduction. Across parts of Africa, Central and South America, and Southeast Asia, organizations like San Francisco-based Samasource are working to bring the benefits of the digital revolution to unemployed young people through outsourced call center jobs.

Other industry players have even been working to rebrand “outsourcing” to the less controversial “impact sourcing,” a term coined and promoted by Digital Divide Data (DDD), a non-profit social enterprise that offers outsourcing services in developing countries. Like many progressive outsourcers, DDD focuses its efforts on poverty alleviation by attempting to provide access to decent-paying jobs and skills development for folks who might not otherwise be employed in the BPO sector.

Jeffrey Puritt awarding GSC 3S 2012 Award to Jeremy Hockenstein,  Co-founder and CEO of Digital Divide Data (DDD)

Jeffrey Puritt awarding GSC 3S 2012 Award to Jeremy Hockenstein, Co-founder and CEO of
Digital Divide Data (DDD)

In a recent Huffington Post article, DDD co-founder Michael Chertok writes that, “while international aid for economic development often fails, business has the potential to bring millions of people out of poverty. For no enterprise is this more true than the unsung $300 billion industry known as Business Process Outsourcing (BPO).”

Business as a Poverty Alleviation Tool

DDD’s is an effort that I applaud. It offers a tangible model for bringing the benefits of outsourcing to small, rural and remote areas. The spread of modern telecommunications ensures that impact sourcing will continue to grow and provide opportunities for poor people around the world.

Still, there’s no doubt that impact sourcing remains in its infancy. In many ways, it reminds me of the financial industry’s attempts to increase access to credit among poor populations. In the past 20 years, the concept of microfinance (making small loans to poor people, often women) has emerged as a powerful force against poverty. Providing access to capital helps would-be entrepreneurs and small business owners to help themselves.

But to achieve the greatest possible scale of social benefit, some argue that small non-profit microfinance institutions can’t do it alone. Without the protective regulation of banks, they may not be able to attract sufficient capital necessary to meet demand. Thus, their impact could be stunted.

One could make a similar argument about outsourcing. While small players and non-profits can undoubtedly make an impact at the margins, larger players operating with a progressive mindset have an opportunity to drive larger-scale, country-level change. But they must be committed to social impact and not be purely driven by profit.

Of course, some outsourcers will struggle to fully embrace the benefits of engaging in socially responsible business. For them, the status quo of cost-cutting and margin management persists, and they’ll continue to seek lower costs at all costs. But over time, I believe they too will evolve as local employees, communities and the clients of BPO services insist upon partnerships that combine bottom-line results with meaningful social change.

Progressive Business Process Outsourcers

As BPOs have matured, they have realized how community development, corporate social responsibility (CSR) and promoting employee well-being positively impact staff retention and service quality. A new white paper that my company, TELUS International, published with CSR consultancy Impakt Corporation called Outsourcing for Social Good: A BPO Perspective, describes how recognizing the positive impacts of social responsibility have created a dramatic transformation in the way many traditional BPOs operate.

Progressive BPOs are going beyond increasing employee salaries. They’re increasingly offering programs that help employees and their families fundamentally improve their lives.

For example, some firms now offer onsite post-secondary and college-level education for their employees. Contrary to the expectation that educating the workforce would increase staff turnover, many BPOs are finding the opposite to be the case.

Progressive BPOs are also increasingly mobilizing employees to volunteer in their communities by supporting basic needs like building roads and schools, as well as volunteering for local grassroots charitable organizations. In addition to building concrete value in the community, these efforts engage employees in work they find meaningful, and corporate volunteer activities demonstrate to employees that the company cares.

Social Change – An Investment that Pays Off

Changes like these aren’t rooted in altruism alone. BPOs aren’t compromising their own profitability by contributing to developing-world communities. Rather, they’re taking the long view and understanding that the more investment they put into their community, the more value it will cultivate.

It’s an investment that pays off. According to the TELUS International white paper, when a

Puritt impakt slide

business helps improve the lives of its workers and their communities, it enables the business to improve its value for customers far beyond cost savings. Investing in people and communities actually improves the quality of the firm’s products and the effectiveness of its services as their employees reward their employers with a higher degree of loyalty, engagement and productivity.

Increasingly, socially responsible companies like the technology heavyweights in Silicon Valley are aligning with these progressive outsourcing firms for the social change they create, as well as the quality of service they provide. BPOs today are going above and beyond business as usual – getting involved in their communities to produce amazing results. As our industry matures, we’ve got real successes to demonstrate – hundreds of thousands of individuals’ lives and entire communities which have been improved through global business.

Our challenge, however, lies not just in producing sustainable results, but in evolving the public perception of the outsourcing industry, particularly here at home in North America. That means spreading the word, and working with all willing partners to continue to create real, measurable change. Domestic employment opportunities are a real concern; and this issue warrants real discussion and meaningful, progressive solutions. But in my view, putting the outsourcing genie back in the bottle and pretending that we don’t all live and work in a global village, however, is not the answer.

About the Author: Jeffrey Puritt is President of TELUS International, a global BPO provider of contact center outsourcing solutions. With locations throughout North America, Central America, Asia and Europe, TELUS International’s almost 16,000 team members support the customer service needs of some of the world’s largest and most respected brands. At TELUS International, team members enable customer experience innovation through spirited teamwork, agile thinking, and a caring culture that puts customers first.  Learn more at: telusinternational.com.

This article was originally published by CSRwire.com on November 7, 2013. Reprinted with permission by the author.

 

 

 

 

 

 

 

 

The Business Case for Impact Sourcing

PumelaSalela100x100By: Pumela Salela, GSC Ambassador in Africa

At the recent World BPO/ITO Forum, held in New York City on June 2-3, a panel deliberated the management challenges, hesitation of larger companies to use Impact Sourcing (IS) firms, and the lack of defined pathways for IS firms to secure contracts and scale their organizations beyond their initial geographic areas. As one of the panel members, I share with our readers many of the issues and points that framed that discussion.

The Creation of Business Value

Impact Sourcing (IS) is about a Call to Conscience. It is about Doing Business whilst Doing Good.

We need to remain aware, and sometimes reminded, that the business of business is the creation of value Economically, Socially, Technologically, Environmentally and Politically.

Economically: Business aims to create profits. It aims to increase margins. IS does not change the core objectives of business. The differentiator is that IS is where profits meet philanthropy. This is illustrated through the case studies shared below.

Socially: IS is a poverty alienation tool. Workers can increase their income by 100% to 200%. Sustainable income leads to positive social outcomes.

Technologically: Through IS, power is put in the hands of the people locally in order to help them drive positive social change.

Environmentally: Green Economy improves human well-being and social equity. It also reduces environmental risks.

Political: Businesses that engage in IS benefit from tax breaks, subsidies and grants.

The Sustainability of Business Models for Impact Sourcing

The best IS business models are usually judged by three metrics:

  • Accessibility to lower income groups.
  • Ethicality, that is, providing a decent income for the suppliers involved.
  • Sustainability for those who are at the Bottom of the Pyramid, the suppliers, their clients and the     intermediaries.

It should be noted that the financial benefits of a business and the development of communities are not mutually exclusive. IS provides an opportunity for the businesses who want to combine a positive financial bottom-line together with developmental outcomes.

Pumela Salela and panelists at The World BPO/ITO Forum June 2, 2014 – New York City

Pumela Salela and panelists at The World BPO/ITO Forum June 2, 2014 – New York City

Case Studies

In order to illustrate the Business Case for Impact Sourcing, four case studies have been selected. Two of these, Cloud Factory and Vindhya-Einformedia, are 2013 winners of the Global Sourcing Council 3S Awards (Socially Responsible and Sustainable Sourcing Awards).

Cloud Factory

Cloud Factory, founded in 2008, built a service sector “factory in a cloud”. Inspired by the traditional model of a factory as invented by Henry Ford in manufacturing, Cloud Factory designed virtual assembly lines in poor locations located in Nepal and Kenya. They currently employ 120 core staff including over 50 software developers, and 3,000 data operators or “cloud workers”. Their goal is to connect one million people in the developing world to basic computer work and raise them up to address poverty in their own communities.

Whereas in other forms of outsourcing, such as crowdsourcing, the employee can be faceless. The opposite is true at Cloud Factory because they physically meet each worker. Each worker is managed by a full-time core team member called a “CloudSeeder”, and has accountability within a team that meets weekly face-to-face. http://blog.cloudfactory.com/2013/02/cloudfactory-acquires-crowdsourcing-competitor-humanoid-and-speakertext.html

Their core theme is “Data Done Better” with the main thrust being “Business Process as a Service, with a Social Mission”. The Cloud Factory offering includes*:

  • A business model that is flexible and A cost effective alternative to traditional BPO.
  • Clients can save up to 50%.
  • Cloud Factory manages ten times (10x) more effectively.
  • There is a three times (3x) faster turnaround.

* Figures based on Cloud Factory metrics.

The organisation, founded on the principles of Social Impact, recognises that profit is what helps grow the Social Impact and Sustainability agenda.

Cost Advantages at a Glance

ataglance for Salela

Vindhya- Einformedia

Vindhya-Einformedia employs and empowers those who are “differently abled” whether they are deaf, lack education or physically challenged. Vindhya-Einformedia also understands that in order to be sustainable they must work for profit.

Vindhya-Einformedia is not an NGO (Non-Governmental Organisation) but a private company achieving sales and profit margins by providing excellent service. The company, which has 750 employees, is located in India in the rural areas of Karnataka, Andrea, Pradesh and Chennai and operates 24/7. They are of the belief that the provision of services from rural areas must evolve from handicraft products to BPO services.

SAI SEVA

Formed in 2006, SAI SEVA stands for Serve and Inspire Sustained Employment and Advancement. A privately-held company, its founders well understood the socio-economic impacts of the increase in the economic divide between urban India and rural India. SAI SEVA also recognised that in the urban BPO sector there is now a talent shortage that is causing a supply and demand escalation of costs. As a result, whereas others saw a challenge in rural areas, SAI SEVA recognized an opportunity to exploit price competition. SAI SEVA uses the potential of youth workers in villages to provide speedy, cost efficient and quality results to customers who require low skill but intense back office work.

Sai Seva staff

SAI SEVA employees in Puttparthi, India
Photo courtesy of SAI SEVA

SAI SEVA offerings include:

  • Provision of BPO solutions at competitive rates to Indian and international companies.
  • 40% to 60% cost savings (Business Line, August 20, 2007).
  • Minimal staff attrition.
  • SAI SEVA business activities help the local villages to support themselves.

 Alliant Global Strategies

Alliant Global Strategies is based in Richmond, Virginia, USA and conducts business from facilities in Accra, Ghana. The company provides services to clients worldwide:

  • Broadband Technician training in order to produce Certified Fibre Optic & Premise Cabling     Technicians.
  • First Level IT Helpdesk.
  • Management Services.

As part of their social impact activities, Alliant Global Strategies creates job opportunities for youth who are in Richmond Social Services and foster homes. The company was inspired by The White House Connected Broadband Initiative, The Rockefeller Foundation’s PRIDE Initiative and the City of Richmond’s Anti-Poverty Commission “Social Enterprise Program’’. They have attained a 100% graduation rate through their training program. The graduates can perform in the U.S. and internationally for energy companies, cabling companies, or any company/ entity that has an IT network infrastructure.

From a Global Perspective …

Internationally, the following IS trends are important:

  • The principle, sole business model of IS started as non-profits in the realm of Impact Sourcing     Service Providers (ISSPs). With the recognition that profits create sustainability within this     segment, both the profit and the non-profit models now exist.
  • The nature of the work cuts across BPO industry verticals and horizontals and varies from simple     to complex.
  • Locations for ISSP’s can be Onshore, Nearshore or Offshore.
  • IS is seen as a mechanism to close the gap in the dichotomy of economies in countries wherein     the population is divided into the “have’s” and the “have nots” such as South Africa; wherein the     economy was divided into the First Economy (developed) and the Second Economy     (underdeveloped).    Partnerships and collaboration create ‘”Partnertition” (a phrase coined in 2011 by Robert F.     Janssen, CEO of Outsource Brazil) which is a co-operative approach to meet common objectives.     This calls for the collaboration and partnerships between the private sector, government, donor     organisations and civil society in order to advance the cause of IS. In South Africa, industry     matched government funding dollar for dollar, so that for every One RAND (South African     currency, also called ZAR) spent by the government, the industry would match it with One     RAND, that is RAND for RAND.
Diagram courtesy of impacthub.org

Diagram courtesy of impacthub.org

  • There are similar value propositions that make the “Business Case for Impact Sourcing” namely;     cost saving, lower attrition, lower training costs, diversity of talent and human capital, and a     developmental impact which has bigger social outcomes.
  • The targeted employees are women, the disabled and youth.
  • IS provides “spill over effects’’ to other sectors of the economy such as food, health, education and     telecommunications. This results in an increased contribution to the GDP (Gross Domestic     Product) of any country concerned.
  • The need to mainstream IS is coming up strongly. There is a call to ensure that Socially     Responsible and Sustainable Sourcing is a decision that corporates make at the Boardroom level     so that Impact Sourcing / Socially Responsible Sourcing forms the lifeblood of an organisation and     thus becomes integrated into the organisational fibre. It should not be just about making     donations in the old business sense but rather treated as Strategic Philanthropy to advance the     needs of the business and the community at large.
  • There is a growing influence of the Diaspora so that those who have been forced to leave their     countries can benefit from IS as a way of ploughing back into their communities. An example is     Head Held High, which was formed by a group of friends who had left India to go to the United     States. Even though they have not returned to India on a full-time basis, Head Held High operates     fluidly as a fully-fledged BPO operation in the rural areas of India.

 What Will it Take to Make Impact Sourcing Scalable?

Firstly, Capital, in the form of human capital and infrastructure such as Information Communications Technology (ICT) in rural areas. Secondly, Skills: there needs to be the continuous supply of skills derived from structured training and development initiatives. Thirdly, there needs to be demand for services from government, large BPO companies and direct clients. Fourthly, Innovation: new business models that create value will require innovation and sustainability.

What About the Sustainability of Impact Sourcing?

The policies that various countries formulate will need to be what I call ‘’Impact Sourcing Centric’’ meaning they will need to put IS at the centre, particularly ICT policies. In addition, governments need to create an enabling environment for ISSPs to emerge. Industry itself needs to mobilize to form Impact Sourcing Industry Associations. Finally, in each and every country, entrepreneurship needs to be fostered in order to promote job creation.

Conclusion

CK Prahalad once said, “New and creative approaches are needed to convert poverty into an opportunity for all-concerned’’. I posit that global issues require global solutions and Impact Sourcing will go a long way in addressing the need for profit whilst ensuring that the levels of poverty, unemployment and inequality are reduced, globally, by ALL.

About the Author: Pumela Salela is an Independent Advisor for the Information Communications Technology and Sourcing sectors. Prior to her role, she was a BPO/ITeS Consultant for the World Bank, in Washington D.C.; a Director of Business Process Outsourcing and Offshoring and ICT Enabled Services at the Department of Trade and Industry, Industrial Development Division, in South Africa; and several other senior positions in South Africa and the UK.

Pumela is a Board Member of the Global Sourcing Council and was recently appointed to the Advisory Council of The World BPO/ITO Forum. She is an active speaker at international forums, business seminars and government events.

Three Ideas to Change the Face of BPO

S Pierre100x100By: Sylvain Pierre, Associate Director of Officience Vietnam

A lot has been covered about the future of BPO (especially in the 32nd issue of Outsource, with over 40 opinion leaders sharing their respective views on how BPO companies should adapt to upcoming trends).

As an expat doing BPO business in Vietnam for the past eight years, I can indeed feel automation taking on all parts of our business, and the increasing demand for more advanced skills such as business intelligence or complex data analysis.

I was impressed by the depth and scope of opinions in that article, but I also believe that a critical point was missing: the social impact of BPO.

More specifically, I believe there are three social aspects that each BPO firm should consider when defining their strategy, and businesses which will thrive will be the ones best able to embrace these ideas.

Understanding Social Impact on Originating Countries

With companies outsourcing processes closer and closer to their core business, the number of people feeling threatened by BPO will increase proportionally. “What am I going to do if they take away this part of my job?” is a very legitimate question, and it will become the providers’ role to answer it.

I believe that BPO is an opportunity for western companies not only to optimise their non-core activities, but also for their employees to move out of their comfort zone, work on more complex issues, and overall deliver more value to their company.

How to address this as a BPO provider? They have to understand that this question will become a key element of the decision to outsource. Providers that will be able to best grasp their customers’ business and to propose new activities for the people they are replacing will definitely have an edge.

With the current faltering economy, outsourcing initiatives will not be cost-driven anymore. It is becoming a social issue for western economies.

Educating the Workforce in the Local Market

Five years from now, most processes currently outsourced will be automated. This trend has been identified by all BPO thought leaders at the beginning of 2013.

Developing the skills of their employees to anticipate this change is surely on the tablets of most BPO providers. It is a point worth highlighting, but I won’t go into the details as to how or why it should be done, as it is quite obvious.

However, social “awareness” development will be a differentiating factor. I believe that outsourcing in general is a transition to a flatter and generally more balanced world, and that BPO providers have a big role to play in order to accelerate this transition.

They want to adopt new management and social trends, and avoid the cheap and quiet workforce path. As a provider, I often get the “Can you tell me how you treat your employees?” question. This may sound like a silly question, but “Well, average salaries, vacation and year-end bonus…” won’t be an acceptable answer very soon.

Developing Services for the Local Market

There is another critical aspect to the skills development point mentioned previously: The (now) BPO providers in developing countries will become the main services providers in their respective local markets – at least, if they anticipate the shift. This idea also comes from the observation that BPO is only a transitory activity.

In Vietnam, the biggest Business Intelligence LinkedIn group has 31 members. Data Science? Well, no group yet. It doesn’t take a genius to figure out the market opportunities.

Officience Vietnam employees planted over 200 bamboo                                    trees locally in 2013 as part of the company’s CSR program                                                  Photo Courtesy of Officience

Officience Vietnam employees planted over 200 bamboos locally in 2013 as part of the company’s CSR program
Photo Courtesy of Officience

Why are BPO providers well positioned to take on this market? They are already handling Business Intelligence, Data Analytics and ERP projects for their western customers. The “glocal” providers (locally based with international practices), more specifically, will get the best of both worlds: they will benefit from advanced expertise on these new topics, while leveraging their local presence and knowledge of local practices.

Last but not least, I believe these new markets are not only a huge opportunity. It should actually be part of BPO providers’ missions to give an impulse and to accelerate the adoption of best practices locally.

Three Practices, One Common Ground

One of the recent business ideas brought by no other than Michael Porter introduces the concept of Shared Value, or how companies can (and should) take on social issues. Some go so far as to say that with the increased transparency on corporations’ activities, it is a matter of survival to embrace this approach.

At first glance most people I meet in France see BPO as a threat to our economy and I’m having interesting discussions every time I come home. I personally see globalisation as an opportunity, both a business and social one, as long as all actors involved are clear that their role goes beyond cost optimisation on one side, and a cheap and quiet workforce on the other.

I believe that applying Shared Value principles to BPO is not only a matter of social responsibility – it is a matter of survival.

About the Author: Sylvain Pierre is Co-founder and Associate Director at Officience, a French privately-owned BPO company in Vietnam established in 2005. Business process and customer support operations services are provided by 300 staff members to Fortune 1000 multinational companies and start-ups. Clients are drawn from Asia, Europe and the United States. He regularly shares his opinions on BPO, innovation and globalisation on his blog and Twitter. http://www.officience.com/en

This article was originally published by on February 6, 2014 in Outsource Magazine. Reprinted with permission by the author.