India is widely recognised as one of the world`s most successful countries in establishing and growing an offshore contact centre industry, but one of the most interesting points to emerge from last month`s inaugural meeting of the South African Contact Centre Community (Sacccom) was that India`s success is largely due to government support.
While the South African government pays lip service to the importance of developing an offshore contact centre industry, there has been little evidence of meaningful support. Does this mean our government believes the responsibility for development lies with the fledgling industry itself?
Forming an industry association like Sacccom is an important step by the industry, but it seems industry can only do so much on its own. While capable of helping to grow an industry cohesively, industry associations are relatively powerless to influence economic conditions.
According to Kiran Karnik, president of India`s National Association of Software and Services Companies (Nasscom), the role of government has been of vital importance to India`s call centre success.
It appears that the kind of help the Indian contact centre industry received did not really involve any significant funding. Instead, it was the kind of help that only governments can give.
Karnik told the Sacccom meeting that the Indian government`s help has been in the way it has shaped policy to support the country`s IT-based industry.
While the deregulation of telecoms in SA is an indication that government is getting the idea of what can be done to help the country develop, why is it taking so long for this process to gain momentum and become more widespread?
Key to success
Why does the South African government delight in reinventing the wheel when it comes to development?
Warwick Ashford, portals managing editor
The Indian example is proof that minimal restrictive legislation and interference by government is key to the success of IT-related industries in emerging countries.
Isn`t it time the South African government started to get real about the nature of its role in development?
It seems fiscal incentives and privatisation were two important initiatives on the part of the Indian government. In this way, IT importers and exporters received support and the telecoms infrastructure was liberated from government control.
Karnik maintains that privatisation in India led directly to better service and lower costs. So what has gone wrong with most privatisation moves in SA? Could it be that we are failing to achieve the same success because we are attempting privatisation only in a half-hearted way?
Although not requiring direct capital investment apart from the provision of better IT education facilities, Karnik says IT-related industries need government support in the form of lower tariff barriers and reduced taxation.
Nasscom`s role in India has been to ensure government played a positive role through lobbying and advocacy programmes. No doubt, Sacccom will follow the Indian association`s lead, but why can`t government figure this out for itself by looking at the Indian example?
Why does the South African government delight in reinventing the wheel when it comes to development? Surely it makes more sense to learn from successes in other emerging countries?
India`s IT industry and related outsourcing industries are booming, but not without the government agreeing to a 10-year tax moratorium on the software sector from 1999.
The formation of Sacccom is a clear indication the contact centre industry is willing to do its part for development, but how long is it going to take the government to come to the party?
Missing ingredient
According to the experts, SA has most of the factors required for success in the offshore contact centre industry. We have multiple, well-developed urban centres, a high level of cultural identification with other parts of the English-speaking world, good technological support, and a high level of multilingualism.
The only key ingredient that`s missing appears to be meaningful government support in the forms given by the Indian government to its local IT industry.
Hopefully, it will not take too long before the government gets real about the crucial role it has to play in ensuring SA has the best chance possible of success as an offshore outsourcing destination.
In the meantime, the industry will have to do what it can and learn to tolerate government`s tendency to drag its feet and do things in half measures.
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