Financial Times

Non-sharing of numbers restricting BPO growth
By Akhry Ameer
The hesitancy and unwillingness to share numbers relating to their own businesses is restricting the growth of the Business Process Outsourcing (BPO) industry in Sri Lanka. The non-availability of collective information such as the size of the BPO industry, number of seats, and type of services being offered is self-diminishing growth opportunities and turning potential investment from a US$155 billion global industry to other BPO markets.

These key insights of the local BPO industry emerged at a recent panel discussion on BPO and ITES (Information Technology Enabled Services) organized by the Ceylon Chamber of Commerce (CCC) and Association for International Standards.

In a grouping of BPO companies called the ITES Association (ITESA) mooted by the Information Communication Technology Agency towards self-development of the industry, has drawn only nine as members out of 23 known BPO companies in the country. President of ITESA Devapriya Perera said even from the membership only his company, Astron BPO, has forwarded details pertaining to itself to the ICTA. This restricts them from projecting the industry overseas and also poses problems of human resources. Unable to promote the industry among the talented youth as a career human resource is becoming scarce with the additional problem of English as a limiting factor.
Presenting the keynote address Afsal Rauf, head of Astron BPO Asia, who also chaired the panel discussion, said the local industry is fooling itself competing amongst themselves when a larger opportunity awaits them outside Sri Lanka. The internationally renowned Gartner group has estimated the global BPO market to be US$ 155 billion while the single largest BPO services country India accounts for only US$ 5.7 billion.

Tracing the history of BPO’s Rauf explained that the concept is not new and its history goes well beyond World War II. The buzzword has emerged with the growth of the industry in which global financial services commands the pie as the largest customer with 27% share followed by Information Technology and Telecommunications accounting for 23% and 15% share respectively.
“In my opinion data processing is the core of BPO,” he said revealing his company’s Sri Lankan operation that started as Data Entry International over a decade ago before being bought by Hays plc and subsequently Astron BPO. Further, the industry which was originally relied upon for margin benefits of late has received more attention as financial institutions were looking at focusing on its core business and outsourcing the rest of its operations. Today, 38% turn to BPOs to reduce operational costs while 32% depend on BPOs to take care of non-core business.

Rauf added cultural setbacks within the companies to implementation of a then known concept of Business Process Reengineering has also led to growth of BPOs. The strong Asian growth has been fuelled by US companies seeking a 24x7 business continuity, he added.

Positioning Sri Lanka as a spill-over for the Indian outsourcing market was also discussed by the panel. Sri Lanka is also said to be a BPO market capable of taking on high complexity work such as the niche carved by Amba Research.
Astron BPO sponsored the panel discussion hosted by the CCC and AIS. Astron BPO is a fully owned subsidiary of Astron UK, the fourth largest BPO provider in the UK and is a part of RR Donnelly.

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