Business News sponsored by Vodacom Transformation of Work:

By Mithum Singh, Chief Services Officer, CCI South Africa

The global shared services sector is booming, driven by the need for companies to manage costs and centralise certain non-core services. Shared services bring value to brands by providing a range of services at a cost-effective and competitive price.

By standardising processes and using specialised software and tools, shared service providers can streamline tasks and functions, leading to faster turnaround times and higher levels of customer satisfaction for brands. 

South Africa is a popular destination for shared services 

South Africa is becoming a major global shared services market, particularly in English voice-based sourcing, so much so that the Business Process Outsourcing (BPO) industry is now regarded as a key driver of economic growth.

The 2022 Ryan Strategic Advisory ranked South Africa as the top destination for BPO worldwide. Recognising the job opportunities and investment potential it presents, the Department of Trade and Industry has identified the BPO sector as a priority sector, particularly for addressing youth unemployment and there is a reason for this optimism – the South African BPO market size is projected to reach USD 3.6 billion by 2027.

The BPO industry is built on its people, offering entry-level accessibility and creating jobs in communities where high unemployment is the norm.

Individuals with varied educational backgrounds and qualifications all have an opportunity to enter the workforce in the BPO sector. While there is a wide range of skills required, digital skills are a crucial element for the long-term success of the industry and the broader digital economy. The BPO industry relies on the local digital talent stack to support attracting global companies. 

How do BPO organizations create a shared services value chain?

The goal of shared services is to facilitate an enjoyable and productive customer experience, and glean data from those experiences that can provide insights to improve business performance. Having the right people in the right roles across the value chain is critical to delivering on those requirements. 

For shared services to really deliver value for the clients and the customers, the customer experience must be absolutely seamless throughout the value chain. Every touchpoint along the customer journey with the brand must be excellent and meet expectations for the brand. Process adherence is critical to ensure the frictionless experience for the customer.

Here, employee experience drives customer experience, because a well-trained and proficient agent, along with a well-designed and well-managed customer journey, will create a superior customer experience and in so doing, add value to the brand. This is not only the job of the agent responsible for engaging with the customer, but also all the functional and support service staff who create and maintain the behind-the-call infrastructure. 

Digital skills are scarce, and in demand

The challenge for South African companies in the BPO space is that the talent pool is predominantly composed of people from disadvantaged backgrounds who are best suited to entry-level positions. Those who do have the chance to get tertiary qualifications and certifications, particularly in the digital skills sector, are in high demand, and are readily snapped up once they have completed their qualifications.

These factors are contributing to an escalating cost of recruitment in the shared services sector, and with that comes the risk to employers of hiring people who may have a paper qualification or certification, but who lack the workplace skills to be effective in their role. This is true of many support functions in the BPO industry as well as those who are on the frontline of customer engagement. 

The risk of employing people who are under-qualified to perform in the jobs they are being recruited for poses a huge risk to BPO companies. Just one poor customer experience can damage the reputation of both the client and the outsourcing company, and research shows that consumers are unforgiving – 77% of customers indicated that they would switch brands after five or fewer negative interactions with a brand’s customer service. For this reason, companies must be extremely diligent and thorough during their recruitment processes to ensure that there is a match between skills and requirements, and interrogate their own recruitment processes to make sure that hiring practises attract qualified and competent recruits. 

Contributing to the development of scarce skills and resources

While digital skills remain sought-after and scarce, BPO companies need to play a role in building skills in the industry. Given the employment landscape and the socio-economic imperatives of creating lasting employment opportunities for South Africans, companies must commit to industry-wide and internal training initiatives including on-the-job training and mentorship, along with NQF level training, to foster skills development.

Equally, to develop scarce skills such as Workforce Management, where there are very limited options for courses to develop the necessary expertise, BPOs must identify promising young graduates and develop the required skills internally. These are not only digital skills – soft skills such as collaboration, empathy, critical thinking and creativity are also in demand in the BPO sector where the human element is a critical factor in customer satisfaction and success. 

By committing time and resources to sector-wide and in-house training, companies in the BPO sector can guarantee that employee skillsets are a match for client expectations, and in doing so, ensure that there is a high calibre of output throughout the entire value chain. An added benefit is that research has shown Not only is this beneficial to each of the companies in the sector, but it will also ensure that South Africa remains an outsourcing destination of choice for global shared services clients.