• Can Mexico Really Become Number Two in the World?

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  By Kirk Laughlin

  Picture this: Over the next four years Mexico rises above China, the Philippines and Brazil to claim worldwide recognition as the second largest outsourcing hub in the world, behind India. Delivery centers in Guadalajara, Monterrey and Mexico City  become service-focused powerhouses for thousands of American businesses. Enabled by the free-moving benefits of NAFTA, offshore provider professionals traverse back and forth between Mexico and the US, free of the visa burdens that might slow rivals in other Latin American countries and others from around the world. Could it really happen?

  If you ask the top executives in the Mexico outsourcing industry, the answer is a confident – ‘yes, we can do it.’
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• The 13th Month Syndrome and Other ‘Rigid’ Worker Protections

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  By Tarun George

  We all know that labor market regulations are an important part of the decision to outsource to a foreign country. They standardize the rules for employer and employee, and make factors like labor costs much more predictable. At the same time, consensus is that excessively strict regulations do not allow the labor market to function efficiently.

  The question for US companies eyeing the LATAM outsourcing industry is, when do these regulations become too rigid?

  The current situation in many Latin American countries could be ‘too rigid’. Enterprise Surveys, a firm that specializes in company-level data collection in emerging markets,  conducted a series of surveys done last year across 14 countries in the region to test for the effects of strict labor regulations on the workforce. The subsequent report by David Kaplan, from Enterprise Surveys, states that laws such as high legally mandated severance payments, mandatory retraining of redundant workers, and restrictions on hours worked not only prevent the labor market from operating efficiently, but also cause lower levels of workforce participation, and higher levels of unemployment. He concludes that making regulations more flexible would lead to an average net increase of 2.1% of total employment.

  The irony is these laws are often union-driven requirements to protect workers, but they sometimes end up doing the opposite. “We had many employees who legitimately wanted to work two or three 12-hour shifts during the week rather than five 8-hour shifts, but because of the overtime rule we couldn’t allow that” — Maggi Williams, VP Corporate Development, KM2

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• PCI Compliance Becomes Next Big Thing for Nearshore BPO

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  By Kirk Laughlin

  The credit card industry’s way of keeping a tight lid on fraud and other slippery activity has been through the creation of “PCI” – the short-code name for a comprehensive set of rules that govern just how credit card handlers should protect card information and the privacy of cardholders.

  Contact centers, especially those in Latin America and the Caribbean that deal with payments, billing and collections, are naturally prime candidates to adopt PCI. “It’s become a big topic of late and in some situations it’s becoming ‘table stakes,’”, says industry consultant Ann Harts, of HartsGroup. “There continues to be a large flow of business opportunities for call center/BPO companies who are PCI compliant… some clients are starting to migrate to this designation as a minimum or an industry standard, even though it may not needed based on the type of work.”

  For one thing, more and more customers are going to demand it, says Thomas Oronti, president of Nearshore Call Center Services, a Dominican Republic based provider that employs about 1,200 agents in three facilities in the country. Oronti told Nearshore Americas recently that PCI compliance has become a top priority for his organization over the last year. “Bigger companies want to see a PCI certificate,” he says.

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• Global Services Firms Maintain Focus in Wake of Chile Quake

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  By Karina Cuevas

  Despite Chile being a country with a long seismic history, the 8.8 earthquake that devastated its southern region left many disconnected from the rest of the world. A lack of electricity and communication has been one of the primary concerns for business owners whose operations are fundamentally dependent on connectivity to the rest of the world.
  

  The global services industry in Chile appears to be rebounding well from last week’s disruption, working simultaneously to reach out and service those in need and also strive to maintain business as usual.

  “Our thoughts and prayers are with those affected by this earthquake. In the wake of this emergency, Sitel’s first priority is the safety and well-being of our associates,” said Dave Garner, Chairman and CEO of Sitel. “The local Emergency Committee is working to contact every associate to determine their situation, get an idea of individual losses, and find out needs and ways we can be of assistance. “

  Sitel has enacted a preparedness plan, built for  these types of situations.  Among other procedures, account teams activated to make contact with customers to minimize the impact on contact center activity.
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• Sitel’s Investment in Nicaragua “Like Striking Gold”

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  By Kirk Laughlin

  Sitel’s Nicaragua operation has been one of the “biggest success stories over the last 18 months” for the global BPO and contact center organization,  Andrew Kokes, VP of Marketing at Sitel, told Nearshore Americas last week.

  That’s a pretty bold statement for a company that employs over 60,000 workers in over 140 facilities in 27 countries around the world. But, Kokes says the value of Nicaragua became so apparent so quickly that the company opened a second facility within the first year, which is a rarity for Sitel.

  “It’s been a phenomenal experience,” said Kokes. “What made it a tough place to be in the 80s, has changed dramatically…  now everyone has come home and they have come back bilingual, and educated.”

  In fact, about 75% of the nearly 2,000 person staff working at Sitel’s two in-country facilities have either lived in the United States or were educated there. “We offer a wage that is better that what is offered through the local economy,” he says.

  Sitel first came to Nicaragua in the early part of 2008. The other major BPO players in Nicaragua are Stream through its acquisition of E-telecare and Concentrix, which  established its operations in early 2009, with the take-over of Intelligent Outsourcing.

  For more about Nicaragua’s emerging services industry, check out our recent posting on PatentVest, California-based business that does the groundwork for companies seeking patent intelligence.

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