Scaling Up Impact Sourcing

PumelaSalela100x100By: Pumela Salela, GSC Ambassador in Africa

Impact Sourcing at Scale: Moving from Idea to Practice was the theme for the Rockefeller Foundation’s international convention on Impact Sourcing (IS), held in South Africa from November 13-14, 2014. The convention was a progression from the Inaugural Rockefeller Conference on Impact Sourcing held in South Africa in November 2011.

In 2011, the theme was Impact Sourcing: An Emerging Path to Sustainable Job Creation and its focus was on three main issues. First, the development and testing of Impact Sourcing Models. Second, Research on Impact Sourcing Interventions. Third, the building of the network of key Impact Sourcing Stakeholders. The debate in 2011 centered around the definition of the ‘bottom of the pyramid’ in relation to IS, the strengths and the weaknesses of the IS operating models and the comparison of training outcomes of IS potential employees with those of traditional Business Process Outsourcing (BPO). In addition, there was a need to garner the support and create awareness amongst the potential IS stakeholders; namely, the government, the donors and the impact investors.

Demographically, Africa is a young continent with a productive,
youthful generation: 60% of its population are under the age of 40.

The 2014 convention focus was on showcasing the uptake of IS, identifying opportunities in the sector, broadening the impact for both business and individuals, ensuring the sustainability of IS and the creation of employment for young people. The convention was the flagship of the Rockefeller Foundation’s Digital Jobs Africa, a $100 million initiative that was announced by the Rockefeller Foundation in 2012 at the World Economic Forum. It aims to improve 1 million lives in Africa by 2019 by catalysing sustainable information communications technology enabled (ICT-enabled) employment opportunities and skills training for high-potential African youth.

Africa is a young continent demographically with 60% of its population under the age of 40. They are a productive generation. They want to create things. There is a need to assist them in order to nurture their creativity and develop innovative leadership on the continent from the bottom up. This mirrors IS challenges globally where almost half of the world’s population lives on less than $2 a day and about 1.8 billion people cannot access a formal job.

Photo Courtesy of the Rockefeller Foundation

Photo Courtesy of the Rockefeller Foundation

The 2014 convention began with site visits to two initiatives that are supported by the Rockefeller Foundation in South Africa. These are the Impact Sourcing Academy (ISA) and Harambee Youth Employment Accelerator. The insights that were shared by the ISA are that the key ingredients for a successful youth employability program are that it has to be holistic, relevant, experiential, demand-led, have a sustainable economic model and ultimately, job placements. The ISA model for scaling up is that they partner with BPO companies who then provide employment for the young people whom they train. The ISA also provides call centre and back office services internally within the institution, so that young people can study and work for the academy which in turn outsources its services to external clients.

Harambee Youth Employment Accelerator helps to prepare young people to overcome the barriers that lead to their unemployability. It connects employers seeking entry-level talent to young high-potential work seekers who are currently locked-out of the formal economy. Founded in 2011, Harambee has to date, placed over 10,000 young people with many of South Africa’s top companies. The ISA and Harambee Youth Employment Accelerator both run at no cost to the young people.

The themes on Scaling Up Impact Sourcing were divided into sessions. In one session the Impact Sourcing Value Proposition was refined by the Everest Group. They proposed that IS should provide services at a lower cost, that it draws from a large and untapped talent pool, that the workforce is stable and finally that there is a social impact that is adhered to when engaging IS. In another session, the Communications Ministry in Ghana shared about the African continent’s delivery of “Greater Value”.

Additional session topics included:From Legislation to Implementation: The Role of Government”, “Impact Sourcing in Practice”, “Global Buyers Experience: How Impact Sourcing has Improved the Business Model” and finally “New Opportunities for the Workforce Engagement, Portals, Online Work, Gamification and Media”. Various speakers shared their experiences under each of these topics with the aim of highlighting the challenges and opportunities brought by IS.

The Keynote address was by Microsoft who indicated that they are in the search for global talent in the fields that Microsoft specialises in. They also indicated that the organisation needs diversification. Africa was highlighted as a continent that could be a contingency for English, offers competitive pricing and the opportunity for IS. What Microsoft indicated Africa should provide is the following: Security – public safety, customer privacy; Infrastructure – technology infrastructure, schools, real estate; Skills – language capabilities and Talent – diverse and vibrant.

Overall, the convention was concluded by all attendees having a shared commitment to scale up IS and to ensure that this impact will in the future be measured. It will be important that partnerships are formed in order to enable the implementation of programmes and projects across the world.

Scaling up Impact Sourcing will rely on capital, skills, demand and innovation.

In my opinion, the scaling up of Impact Sourcing will rely on four key deliverables:

  1. Capital in the form of human capital and infrastructure. For example, ensuring that there is Information Communications Technology (ICT) in rural areas.
  2. Skills – there needs to be a continuous supply of skills that is derived from structured training and development initiatives.
  3. Demand- there should be demand of services from the government, large BPO companies and direct clients.
  4. Innovation- there must be new business models that create value that in turn ensures sustainability.

What is the ‘’Impact’’ in Impact Sourcing

The Impact on Business

  • IS provides high quality service for typically 40% lower cost because of lower salaries, lower training costs and lower attrition.
  • Impact Sourcing Service Providers (ISSPs) can provide unique services that might not align well with the scale of traditional providers.
  • IS employees provide-high-quality services. The increased retention among its employee type enables them to provide consistent quality services to clients.
  • The global nature of IS allows companies to expand into new markets, diversifying their outsourcing portfolios.

The Impact on Individuals

  • IS employment provides measurable increases on income levels. Data suggests that IS employees benefit from income increases between 40% and 200%.
  • IS provides an opportunity to learn transferable skills that serve as a springboard for future job opportunities.
  • In addition to the benefits of formal, stable employment, IS employment also increases family investment in health care and education.

Source: The Rockefeller Foundation. To read more about the Digital Jobs Africa initiative: http://bit.ly/1zKiNj4

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.

 

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