SA is still not proactive enough about winning outsourcing contracts from overseas companies, says Stuart Herd, a director of local business process outsourcer eQuals Group.
"Although SA was ranked number six last year as an outsourcing destination, behind countries that include China, India, Ireland and Canada, there is no reason why we cannot move up a few notches if we realise just what we have to offer," he says.
"Despite the continued strength of the rand - which makes our labour more expensive than it was in 2001 and 2002 - we are well-positioned to capture more overseas outsourcing contracts with companies operating in First World markets. Our labour is still a lot cheaper than that in the US, Europe and Canada. And, because we essentially have a First World business philosophy and a westernised culture - and because we generally conduct business in English - we should be able to manage outsourced work, such as running call centres and back-office functions, that much more smoothly than other countries."
Herd points out that the IT outsourcing market in the US alone is estimated to be worth more than $100 billion a year. He highlights the case of his company, which only started looking at the offshore outsourcing market in March last year, and is already predicting that outsourcing revenues from offshore companies will generate the bulk of its revenue within the next five years.
"When people talk about outsourcing they think of help-desks, programming shops and call centres, but within a few years, countries that excel in outsourcing - such as India - are going to transform their offerings even more. Today's Indian call centres and programming shops are just the start; tomorrow they will branch into financial analysis, research and graphic design - frankly, anything that does not require physical proximity," he says.
"There is no reason why South African companies cannot gear up to start competing in this market."
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