Compiled by Dona Senara

REACHING OUT TO OUTSOURCE

Jehan Perinpanayagam explores the trends in and advantages of outsourcing

Q: What is your assessment of local talent in human resources (HR) in the business process outsourcing (BPO) sector?

A: Sri Lanka has a rich talent pool; global entities such as HSBC, Accenture, RR Donnelley, and WNS have recognised the high quality of our people. That’s why the island has been labelled ‘a gem’ by Kearney.

Our BPO sector is renowned for high quality, timely delivery and continuous innovation. Other attractive factors include the relatively low rate of attrition, strong focus on building relationships and involvement of senior management.

Sri Lanka’s BPO sector employs over 25,000 people and the aspiration is to double this number by 2025. There have been some challenges of late as a result of talent migration due to the post-pandemic situation and economic crisis.

Though we expect this trend to slow down in the coming months, we’re proactively working on building new talent pools in second cities and ‘return-ship’ program­mes for women to rejoin the workforce.

Q: How can BPOs embrace a more inclusive model compared to the Colombo-centric growth seen in recent years?

A: I have firsthand experience of this since my business was one of the country’s first rural BPOs, and I’ve witnessed its success and sustainability. Several other BPOs have also done this successfully by setting up operations in second cities.

The way forward is to choose cities with a high readiness index that’s based on talent, connectivity and a few other indicators – and set up offices in such localities. It could be a small start but we must begin somewhere. Sri Lanka’s cricket team is a great example of achieving success once we embraced talent from across the island.

Using the capacity of the Sri Lanka Association for Software Service Companies (SLASSCOM), regional and BPO forums are doing a wonderful job of creating awareness of the sector across the provinces, and encouraging youth to embrace such work.

Q: What are the latest trends or innovations in the BPO sector?

A: We are seeing the convergence of technology with BPO. Technologies such as robotic process automation, AI and ma­chi­ne learning are revolutionising the sector.

It is increasingly automating more standard processing tasks and moving up the value chain by offering additional know­ledge intensive services. Buyers are quite sophisticated today; they are also considering environmental, social and corporate governance (ESG) principles when choosing suppliers.

Q: Describe the competition and what strategies can be employed to stay ahead...

A: Several established players have the reach and critical mass together with name recognition. For many smaller BPOs, gaining access to international markets and competing with well-known giants is challenging.

Q: What are the main challenges faced by the BPO sector?

A: It needs to evolve to stay relevant and embrace disruption by technology. The good news is that the sector is predicted to grow through 2030. Talent and access to markets are some of the major challenges it faces.

Q: And what are the key drivers that motivate businesses to opt for BPO solutions instead of handling processes in-house?

A: Most mature enterprises understand that they’re best served by focussing on their core business. Other compelling factors include talent challenges and rising costs.

Q: How do BPOs ensure protection of sensitive information – and what security measures should entities look for when selecting a BPO?

A: Sri Lanka was one of the first countries to introduce a data protection act. Several entities are ISO 27001 certified for information security. There is rigour in our approach to information security; and so far, Sri Lanka has a good track record.

Q: Could you outline how the concepts of ‘onshoring,’ ‘nearshoring’ and offshoring play a role in the BPO sector?

A: Some of the factors at play here include costs, access to talent, travel time, cultural familiarity and time zones. Each option has its advantages.

Offshoring could offer access to large talent pools and very competitive costs. Nearshoring and onshoring have the advantages of cultural similarity, lower travel times and possibly less training. There could also be a mix of factors such as access to talent, value, and physical and psychological distance.

Clients will need to weigh these factors and choose the best options for their organisations.

Businesses should prioritise lasting benefits; and I believe that offshoring has long-term advantages such as large talent pools, significantly better value arbitrage, the ability to scale, different perspectives and new thinking.

Q: And last but not least, are enterprises able to ensure that outsourced processes meet their quality standards and achieve the desired cost efficiencies?

A: The leading BPOs have strict training protocols, as well as quality assurance and process excellence functions, which are tasked with ensuring quality, good processes and system controls.

Automation is also being increasingly used. It is important to define quality and use tools such as Six Sigma.

This interviewee is the Chief Executive Officer of Infomate.