Can India and the Philippines still lead global BPO when WFH is now essential?

On the BBC World flagship technology programme ‘Digital Planet’ this week they explored some research undertaken recently by the Tuft’s University Digital Planet Initiative – nice name.

Specifically the researchers had compared 42 different countries and used three important variables to place them all on a chart that summarised which countries are ready to support working from home (WFH). The three values being compared are:

  1. Robustness of digital platforms
  2. Resilience of internet infrastructure to traffic surges
  3. Proliferation of digital payment systems

You can see the results in this Harvard Business Review article summarising how all of the 42 countries performed.

Singapore was the clear leader, the only slight downside there was the ‘average’ adoption of digital payment systems, but on the other measures Singapore is clearly ahead of the world. This is not a surprise. Singapore is a modern country and it’s very small – just a few million people on a small island – so the infrastructure should be good.

The other leaders are some of the highly developed economies you might expect to see in a study like this – the UK, US, South Korea, Germany, Estonia, Netherlands, and Canada.

The real shock in this research is India – far and away the worst performance of all the countries measured in this study. Not just bad, but tucked away as an outlier far from any other nation. Other poor performers are Chile, Indonesia, Thailand, and the Philippines. According to the Tuft’s research, WFH in these countries is extremely difficult.

McKinsey has been extensively covering the Covid-19 crisis and in particular the need for companies to suddenly operate as distributed networks of employees all working from home. One of their analysts recently suggested to me that in the Business Process Outsourcing (BPO) industry perhaps as many as 30-60% of employees will stay at home for the foreseeable future.

Many companies want their employees back in the office, but BPO is interesting because employees have been more productive working from home and most of them prefer the flexibility of home working. Companies that allow some to stay at home permanently and some to use the office will meet the needs of those who want flexibility and those who don’t have the space or facilities to work from home.

But BPO includes an area that I cover a lot – customer service and experience. The contact centres all over the world sent almost all their people home. One of the biggest companies in the world, Teleperformance, had around 10,000 agents working from home before Covid-19. Now they have over 200,000. It’s been a monumental change in the way that some of these companies operate, but they have successfully achieved this dramatic evolution.

But there are alarm bells if you combine the McKinsey estimates with the Tuft’s research. Let’s say that around half of all contact centre agents are staying at home until we have more ammunition against this virus. According to Dr Fauci of NIAID in the US we are looking at 12-18 months to roll out a vaccine to a significant number of people IF the trials go well this year. So the best case scenario is that a trial works out during 2020 and it takes all of 2021 to distribute vaccines to those most in need. So we are looking at a significant number of people working from home until 2022 – longer if the vaccine takes more time.

India and the Philippines are two of the most important nations for contact centres globally – millions are employed in this industry in just these two nations. It’s not just about low cost labour. India and the Philippines both have an abundance of educated English-speakers that can work in customer service and contact centres are mature businesses in these markets.

What if there is no longer any business case for BPO to function in India or the Philippines because these nations cannot accommodate the need for half of BPO employees to work in the office and half in the home?

I’m not making a prediction here, merely connecting the dots between the work of various researchers. I’d appreciate some feedback from companies in India and the Philippines. How are you making this work if the Tuft’s research says that home working is extremely difficult in your locations?

Can BPO in India and the Philippines remain viable in the New Normal?

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