The arrival of large contact center players like Sitel, 24-7, and Stream in Nicaragua has definitely accelerated the country’s BPO sector – to the tune of US$ 60 million in global services exports for 2011. As expected, many large entrants bring their customers and their global delivery models, yet a number of small-national BPO / KPO and IT services companies are trying to leverage their nimbleness to expand into new market niches.
“Some of our clients didn’t believe the things they now outsource to us could be outsourced to Nicaragua,” says Javier Hugetobler, General Manager at Concentrix Nicaragua. Although Concentrix is operation was born out of the buyout of local provider, they still have the hallmarks of a small-hungry national provider. It is a 60 person team that can quickly grow to 120 and wants to take on pilot projects, even if they require just a few agents.
“It is tough in the beginning, lots of management for little profit, but it opens up doors. We can do a five person pilot over 90 days, we are doing it and we have seen it work. It is just a matter of understanding the scope of work, finding the people and putting the right management in place,” remarked Hugetobler.
He gave us some insight into the human resources product life cycle work Concentrix is doing for US clients where his team will optimize job postings, distribute them to different job engines, pre-qualify resumes, and carryout pre-selection phone interviews so the client ends up with a quality assured candidate list that eliminates HR drudgery.
Almori is a national BPO services company that has grown from 12 employees in 2003 to 180 today and projects to have 240 by 2012 year end according to Alejandra Medina, Business Development Manager at Almori. Almori built key alliances with US partners and does a substantial amount of medical billing services, collections, and accounts receivables analysis.
Almori is also inclined to do pilot projects. The company took on an outbound sales pilot and in a relatively short period of time helped a client grow its sales from US$ 5,000 per month to US$ 100,000 per month.
“It would be nice to get more support from the government in driving a bilingual workforce, eventually we are going to hit a wall. That is the main help they [the government] could give, the industry already has a $2 million per month payroll.”
When we asked our interviewees how they were able to find the right people to achieve good success with these small pilot programs that can be somewhat ambiguous in nature and require highly specialized workers, they said again and again that being entrenched national companies with good recruiting strategies is the key.
“The most important thing we bring to the table is finding the right people, at the right cost, at a reasonable speed. There are lots of educated people and not a lot of job opportunities resulting in lower wage rates. Additionally, we built a campus where people want to work,” said Alejandro Graham, CEO of Accedo Technologies. Graham was referring to what he and Sales and Marketing Director, David Levy, refer to as Nicaragua’s “first real tech park.” The 10-acre facility counts an 800 agent capacity building (currently at about half-capacity) and data center built to the specks of what a Fortune 100 company would need according to Accedo.
In talking with our interviewees we found that the wage rate charged to a client for a bilingual Nicaraguan BPO worker averages between US$ 12-15 dollars per hour, similar other markets in Central America.
According to ProNicaragua, an average bilingual agent (contact center) worker’s monthly salary is US$ 673 including taxation or US$ 3.55 per hour. A team leader in a contact center is estimated to cost US$ 1,548 and a general manager US$ 2,491 per month, or US$ 8.20 and US$ 13.16 per hour respectively. There are currently more than 4,000 bilingual agents in Nicaragua according to ProNicaragua and English schools pooping up like Starbucks according to our interviewees, but like other Latam markets there may be a saturation point approaching.
“It would be nice to get more support from the government in driving a bilingual workforce, eventually we are going to hit a wall. That is the main help they [the government] could give, the industry already has a two million dollar per month payroll,” said Medina.
ProNicaragua has a different set of estimates for ITO; junior and mid-level developers register at an average of US$ 800 and US$ 1,100 per month while senior developers and support techs average US$ 1,800 and US$ 750 per month, respectively. There are seven companies recognized by ProNicaragua as software development companies. Only 14 percent of Nicaraguan engineers that graduated in 2011 are in systems and computing, that probably means there are or will be a lot of repurposed electrical engineers developing software.