How South Africa’s BPO industry can keep winning in global markets

Wayne Francis, CEO of Global Connect Outsourcing.

“By recruiting and training individuals from underprivileged communities, GCO is making an impact where it matters most“

South Africa’s Business Process Outsourcing (BPO) industry is a dynamic sector and is increasingly becoming a crucial player in global markets. This is in large part due to the country having a strong reputation for delivering high-quality customer service enabled by our neutral accent; low cost margins; our cultural affinity with Western markets; and our advanced digital and technology ecosystems. 

In addition, the local BPO industry continues to leverage other sources of market attractiveness including our strategic location; favourable time zone alignment with major markets; and a large English-speaking workforce.

Not only has the South African BPO industry become a significant source of employment, providing opportunities to over 270 000 individuals as of 2023, but it also promotes inclusive employment practices by providing job opportunities for marginalised groups, including women, people with disabilities and individuals from economically disadvantaged backgrounds. It is this focus on inclusivity that helps address some of the socioeconomic disparities in South Africa, promoting social cohesion and economic stability.

What is especially worth noting is the extent to which South Africa stands out in the global BPO industry due to its leadership in impact sourcing. 

The country boasts the largest impact sourcing sector in Africa, with nearly 70% of its BPO workforce coming from socioeconomically disadvantaged backgrounds. This approach addresses unemployment and provides stable, meaningful employment opportunities. Projections indicate the creation of 500 000 new jobs over the next decade.

Impact sourcing not only helps integrate disadvantaged individuals into the economy but also includes training programmes that enhance their employability and career prospects. For global enterprises working with local BPO companies, this highly effective impact sourcing model offers them a means of making a positive social impact while deriving business benefits from a motivated and capable workforce.

Global Connect Outsourcing’s (GCO) own impact sourcing initiative is focused on recruiting and training individuals from underprivileged communities in South Africa. The programme was established by the company to effectively address social inequality and to build a diverse and inclusive workforce, able to provide clients with world-class customer experience solutions. 

Beyond job creation, the BPO industry also contributes significantly to South Africa’s economic growth in the following ways: 

1. Foreign Investment – South Africa’s competitive cost structure, skilled labour force, and advanced infrastructure make it an appealing destination for global companies that contribute valuable foreign exchange. 

2. Export Revenues – as a key source of export revenue, the BPO industry contributes billions of rand to South Africa’s economy annually via the influx of foreign currency that helps to reduce the trade deficit.

3. Stimulating Demand in Other Sectors – the BPO industry’s growth stimulates demand and resulting investment across infrastructure sectors including commercial real estate, technology and telecommunications. The disposable income of BPO employees driving consumer spending in retail, hospitality, and transportation underscores the multiplier effect of the growth benefits the industry generates for the overall economy.

However, sustaining this multifaceted contribution to job creation, economic growth and resulting social cohesion requires the South African BPO industry to not only be aware of but respond to the major trends defining and shaping the future of BPO globally. These include:

1. Enhanced Customer Experience (CX) – one of the most notable trends in the global BPO industry is the shift towards enhancing customer experience (CX). BPO providers globally are moving beyond traditional call centres to integrated multi-channel support, including social media, chatbots and other digital platforms. Their robust adoption of digital transformation aims to meet customers where they are, ensuring seamless and consistent support across various touchpoints. Together with advanced digital ecosystems, highly skilled and trained employees in South Africa play a crucial role in delivering superior CX. 

2. Integration of automation, artificial intelligence (AI), and machine learning (ML) – these technologies are increasingly being used to handle routine tasks, improve accuracy and reduce operational costs. As elsewhere, adoption of these advanced technologies presents both challenges and opportunities for the local BPO industry.

While automation can lead to job displacement, it also necessitates the development of specialised skills, fostering a more skilled workforce adept at managing advanced technologies. Balancing automation with growing local employment levels will be crucial. Overall, however, the integration of AI and automation will significantly enhance the industry’s market attractiveness.

Global Connect Outsourcing (GCO) in itself leverages advanced technologies such as AI speech analytics and customer sentiment analysis to provide clients with actionable insights and reporting, resulting in a competitive CX advantage for them. 

Its partnership with a European Digital Skills Institute as well as its own SETA-Accredited Training Academy marks a ground-breaking investment by the company in workforce training and development to provide its employees with highly responsive, future-fit training programmes including customer experience (CX) management, artificial intelligence (AI) and data analytics. 

3. Growth of Niche and Specialised Services – the global BPO industry is rapidly moving towards specialised, industry-specific services and away from generic offerings. Companies are increasingly seeking out BPO providers with expertise in sectors like healthcare, finance, legal services, and e-commerce. Local BPO companies can leverage this trend by building deep expertise in specific industries and use sector specialisation as a growth strategy. Delivering more precise and effective solutions enhances service quality, client satisfaction and builds market attractiveness.

In conclusion, the BPO industry plays an undeniably crucial role in South Africa’s economic and social development. However, to fully unlock its potential to deliver sustainable growth, it is essential to address the challenges of automation, infrastructure, and, importantly, social issues. 

With the correct responsive strategies by its operators, the BPO sector can continue to drive economic progress and social upliftment in South Africa for years to come.

– Wayne Francis is CEO of Global Connect Outsourcing (GCO)