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Thoughts from India By Ed Romson, CEO, Rocair Corporation I am writing this article as I travel back from a week long trip to Chennai (Madras), India. I have plenty of time to do this, as the travel time will be over thirty six hours; going by way of Singapore, to Seoul, Korea, and then to San Francisco. I had a good trip to India. I was working on a project in the Auto Parts Industry, and I was also able to visit a premiere call center located there. These visits led me to start thinking about the contrasts and similarities between doing business in Argentina and in India. I'd like to share some of those thoughts with you in order to suggest how Argentine businesses can benefit from the lessons learned by companies in India. There are, of course, many differences between the two countries. However, similarities do exist. The first difference that comes to mind is that there are many more people in India than in Argentina. India has just over one billion people living there compared to 36.5 million in Argentina. The sizes of the countries are about the same; the land area of India being 2.9million km2 and Argentina 2.7million km2. While the total Gross Domestic Product (GDP) of India is much higher than that of Argentina, US$547billion as compared to US$91billion, the "per person GDP" is lower at US$1,786 per person for India and US$7,636 per person in Argentina. It is interesting that there are actually fewer people in Mumbai, India's major city (12.1 million people), than there are in Buenos Aires and its surrounding areas, which totals 12.9 million people. Culturally, the two countries are very different. One similarity however is that both of the countries value education very highly as a way to improve social and economic conditions. Both countries also have a large educated middle class, with a thriving business environment because of that wealth of knowledge. One expert I spoke to in India mentioned that the state of Tamil Nadu, where Chennai is located, will graduate over 75,000 engineers this year. While I'm sure the Universities in the Buenos Aries area will graduate many professionals this year, I think this points to a basic difference that has led India to prosper in the Business Process Outsourcing (BPO) industry. This industry includes the call center and customer care outsourcing business, my speciality. It also includes businesses that provide services in Information Technology outsourcing. I'm sure many of you have heard that companies have been sending their programming business to India for many years, and major IT companies like Cisco, IBM and others have set up entire subsidiaries in India to perform this kind of work. There is increasing sales pressure from companies in India to bring customer care calls offshore from the EEUU to India. This offshore movement has resulted from the fact that overall costs to handle a contact in India are one third the cost of handling the contact in the EEUU. The labor cost is one factor, but companies in India have made good use of Voice over Internet Protocol (VoIP) technology to carry calls from the EEUU to India for very low cost. This is where one of the direct lessons can be learned by Argentine businesses from their counterparts in India. The same business conditions that existed in India are present today in MercoSur. Labor in Argentina carries a lower cost-base than in the EEUU. The telephony and IT infrastructure is excellent and the business environment is stable. Take these factors and couple them with the facts that the cultures of Argentina and the EEUU are closely related (both cultures originated in Europe), the time zones are similar, and travel times are shorter between the countries (I've watched four movies so far on this trip). All of these conditions point to the conclusion that BPO outsourcing from the EEUU to Argentina is a good business proposition. I am not suggesting that companies in Argentina compete directly with Indian BPO companies. There are differentiators present in Argentina that suggest that a specific kind of BPO business is appropriate. I would suggest that the Hispanic market in the EEUU, and specifically Spanish language BPO, is an area where Argentina has a distinct advantage. Spanish language capabilities in India are very low, and BPO companies there who are servicing EEUU companies in English are struggling to provide Spanish language support; if they try at all. EEUU companies are coming to realize that they must provide Spanish language support because the Hispanic population in the EEUU is increasing very fast. That population has a very large purchasing power, and if companies want to get and keep their business they must provide services to those customers in Spanish. Secondly, while India is a good source for customer support during the night hours in the EEUU, the time difference makes doing business between the two countries difficult. Companies in similar time zones, who can provide high quality English language support, will have an advantage. Quality of service is a very major point and this will be the topic of my article here next month. There is now an opportunity for businesses in Argentina to capitalize on the lessons learned in India and to expand their business beyond the borders of the country, and even MercoSur, to the EEUU. With the excellent business infrastructure that exists in Argentina, similar cultures, language capabilities and ease of access to the market, business people here should be looking to the EEUU as a source of business.© Copyright Rocair Corporation. All rights reserved. |
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