Can Mexico Really Become Number Two in the World?
March 11th, 2010By 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.’
FLORHAM PARK, N.J., March 9 /PRNewswire-FirstCall/ – Global Crossing (Nasdaq: GLBC), a leading global IP solutions provider, today announced it is significantly expanding capacity on its Mid-Atlantic Crossing (MAC®), South American Crossing (SAC®) and Pan American Crossing (PAC®) undersea fiber-optic cable systems to meet rapidly growing demand for Internet Protocol (IP) and Ethernet transport among its enterprise, carrier and service provider customers. These overbuilds will enhance connectivity between Latin America, North America and Europe and will be rolled out over the next six months, with some segments ready for service as early as May 2010.
“The Latin American market is poised to sustain strong growth,” said John Legere, Global Crossing’s CEO. ”The investments we are making are in response to the continued demand Global Crossing is experiencing across our global network for broadband services such as video over IP, social media and content delivery networks.”
Global Crossing’s MAC undersea …
The 13th Month Syndrome and Other ‘Rigid’ Worker Protections
March 9th, 2010By 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
Cloud Services Has Little Value in ITO Virtualized Environments, Says Everest Research
March 9th, 2010Cloud computing as an IT Outsourcing (ITO) strategy presents a viable business case for companies with traditional enterprise platforms, but the cloud’s utility is not apparent when compared to a virtualized setup, according to Everest, a global consulting and research firm.
A buyer’s investment in a cloud infrastructure can save 40-50 percent over a traditional enterprise platform, according to a new Everest ITO study, Hype and Reality of Cloud Computing – Mind the Gap! The cloud proposition over enterprise setups is based on IT suppliers’ abilities to leverage scale to improve asset utilization, lower costs for asset procurement, standardize delivery and processes, and offer labor flexibility that reduces labor support ratios and delivers services from less expensive locations. On the other hand, large organizations running virtual datacenters may not find added value from cloud services unless IT demand is very volatile or through labor savings gained by large-scale …
Cognizant Adds to Argentina – Is Mexico Next?
March 8th, 2010US IT services firm Cognizant (Nasdaq: CTSH) will be expanding services offered from its Argentine delivery center, the company’s country manager for Argentina, Cristián Argüello, told BNamericas.
Cognizant currently focuses on providing business application development, support and maintenance from its center, which is located in Buenos Aires. Argüello said the division will be developing business process and infrastructure management services, primarily for Cognizant’s global clients that are either expanding to Latin America or are looking to the region to complement their existing outsourcing plans.
“We are referring to value-added business processes and also device, network, server, database and operating system monitoring,” he said.
The life sciences, financial and consumer goods sectors represent Cognizant’s main regional clients, with each market accounting for 20-25% of the Argentine delivery center’s revenues. Argüello noted that market consolidation – especially in the life sciences industry – is also helping to generate new IT service business opportunities. Other 2010 …
Doors Set to Open for US Internet Service Exports to Cuba
March 8th, 2010The US government is planning on loosening internet service export restrictions to Cuba, the US Treasury Department said in a statement.
The Treasury Department will issue a general license for the export of certain personal internet services – including instant messaging, e-mail and social networking tools – to Cuba, as well as Iran and Sudan. The new regulation will also permit the export of software to Iran and Sudan.
“Unlike Iran and Sudan, the exportation of goods and technology, including software, to Cuba is separately licensed or otherwise authorized by the Commerce Department,” the statement read.
The changes will be implemented through amendments to the Iranian Transactions Regulations, Sudanese Sanctions Regulations and Cuban Assets Control Regulations. The New York Times reported on Sunday (March 7) that US government officials will examine requests on a case-by-case basis. The report added that the Treasury Department is likely to grant a license for the …
M&A Activity in Latin America Off to a Red Hot Start this Year
March 5th, 2010Takeovers in Latin America are off to the best start in at least a decade, bucking a global slump, as economic recoveries in Brazil and Mexico spur consolidation in the telecommunications, food and commodities industries.
America Movil SAB’s $25.7 billion purchase of Carso Global Telecom SAB in Mexico was the largest in the region this year and the second biggest globally. Latin America tallied 192 announced deals worth $72 billion since Jan. 1, the most in Bloomberg data going back 10 years and the only region to see an increase in transactions this year from the end of 2009.
More than a third of 2010’s transactions were in Brazil, where the economy is rebounding from a recession, the currency is up 32 percent against the dollar in the past 12 months and interest rates are at record lows. The region may have its best year for acquisitions since 2007, said Udi …
PCI Compliance Becomes Next Big Thing for Nearshore BPO
March 4th, 2010By 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.
Global Services Firms Maintain Focus in Wake of Chile Quake
March 3rd, 2010By 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.
Sitel Boosts “HomeShore” Program, Hires 200 in New Mexico
March 3rd, 2010Global business process outsourcing company Sitel plans to add 200 associates to its HomeShore program in Albuquerque.
The company allows associates (“agents”) to work from home while they’re helping its Fortune 500 clients manage their outsourced customer care needs, a prepared statement from Sitel said.
Sitel said that since its initial launch in 2008, the Albuquerque HomeShore program has proven to be a successful model for Sitel clients across the U.S.
“The continued demand from our valued clients to place their call center operations in the Sitel HomeShore Program is a testament to the quality of service our Albuquerque agents provide on a daily basis,” the company said.
Officials said the current recruitment drive will support the recent expansion of a major worldwide hospitality provider that has outsourced its calls to Sitel to provide customer service and technical support, both online and by telephone.
The Sitel HomeShore program has added …
