As Philippines Value Prop Sinks, Nearshore Steps Up, Says Atento Exec

According to Michael Flodin, Atento’s Nearshore Regional Director, US clients are choosing to bring their Philippines campaigns to the Nearshore.

philippines call center

As Nearshore continues to champion its benefits as a low-cost, high-quality destination for English-speaking call center campaigns, the traditional industry choice of the Philippines is beginning to lose ground.

According to Michael Flodin, Atento’s newly appointed Nearshore Regional Director, US clients are choosing to reshore their Philippines campaigns to the Americas, both north and south of the border.

In a recent interview, Flodin shared his strategies for achieving his goal of 12-15% market share in the region, as well as explaining why the Philippines is losing ground to Nearshore.

Nearshore Americas: As Nearshore Regional Director, what are your key responsibilities and what strategies do you intend to implement to grow market share in the region?

Michael Flodin
Michael Flodin: “A lot of US customers are asking about bringing their campaigns back from the Philippines to the US or to Nearshore.”

Mike Flodin: I’m responsible for the company’s operations in Puerto Rico, Guatemala, El Salvador, Colombia, Mexico, and the United States, all of which are currently serving the US market.

From a location strategy standpoint, we see Guatemala as a prime growth location. We have decent sized operation in Guatemala City with two locations. The English language skills are fantastic and labor is readily available. The same is true with El Salvador; both countries are our prime, go-to locations for Nearshore clients. Hot on the heels of that are Colombia and Mexico, simply because of location and availability of resources.

One of the macro issues in the call center space that is driving our Nearshore growth is the trend of US customers bringing volume back to the Americas from the Philippines. There are a lot of strong US companies who are talking to us every day about different options for bringing their Philippines campaigns back to the US or to the Nearshore. This is one of the biggest growth strategies we have right now.

What we’ve found is that locations like Guatemala, Colombia, and El Salvador, have the same English language capabilities that customers have in the Philippines, and the price points are now comparable. The over-saturation in the Philippines, the reduction in price for some of the Central American companies, and the political situation in the Philippines all support this growth.

In addition, we’re targeting very specific companies in the US market, what I would call mid-cap companies, somewhere between the US$1-5 million in revenue, that are really in our sweet spot.

Nearshore Americas: Are you seeing a change in the US perception of Nearshore as you bring back campaigns from the Philippines?

Mike Flodin: Different customer segments have different perceptions. Some of the larger multinationals in the US still perceive security issues and have restrictions that prevent them from traveling to certain Central American countries. Mid-cap companies are much more open to Central American countries as a destination, given the parity of price points, time zone equality, and ease of transit.

Most of our clients would like to be in their call center once a month, or more frequently if they can take a 2-3 hour flight. Once they come to terms with how decent the location is from a travel perspective and a cost perspective, then we can get them on site, introduce the teams, and show them the operation. Once they get comfortable with the level of English language proficiency, the location wins them over.

We’re not going to get everyone; there are some companies who will be concerned about security. This is why we have some alternatives in Puerto Rico and Texas.

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Nearshore Americas: With the relatively limited capacity of agents in Central America, how do you intend to overcome the issue of scaling campaigns?

Mike Flodin: Scaling a problem that all BPOs have with some of the cities in Central America, so our first approach is to scale in the central hub of each country as much as we can. In Guatemala, for example, we’ll scale the Guatemala City location and our World Trade Center location, where we have room to expand by around 300 more seats. The secondary approach is to go to nearby, tier 2 cities, where the English language is still solid, the cost points are similar to Guatemala City, and we effectively manage the teams across those sites. It’s really a hub and spoke operation, giving us real flexibility to scale up and down when necessary.

Nearshore Americas: Having spent the last three and half years as Atento’s COO, what were the challenges of managing the operational and IT side of the business on a global scale, and where do you see technology leading the company’s business decisions?

Mike Flodin: In that role, I was primarily responsible for operations and IT, with a little bit of the global recruiting and selection process for agents across the company. We had a blueprint laid out for all the transformational programs across the company, so the pieces I was responsible for were focused on operational efficiency. This means driving the operational KPIs in the right direction, enabling us to improve our bill-to-pay ratio, and increase our occupancy to drive company efficiency.

One of the things that were driving on the telecom side is a move to the Cloud. We’ll never be 100% in the Cloud, but definitely need to have a higher percentage of telephony there than we do now. Cloud telephony gives us a lot more flexibility to ramp up and ramp down quickly. We have some clients with very seasonal volume at the holiday season. Over a three month period, we would need to ramp up by 30-40% for those clients, then ramp back down, and subscription-based telephony technologies give us the option to do that. We just can’t do that with the on-premise, heavy solutions we’ve had in the past.

We’ve also started the migration to a series of central data centers, and monitoring solutions so we can monitor things that manage the data centrally, all to drive efficiencies. From an analytics and data standpoint, we launched Atento Digital two months ago, which is being led by our Brazil operation. This is to drive the digital experience for our customers. We also acquired a company called Keepcon in Argentina, which will help us with the digital journey with a web monitoring, analytics, and automation offering.

Technology is all about flexibility in our environment. When you think about the ebb and flow of volumes across the company each year, we need to have more flexibility in our technology platforms to respond to that.

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