Monthly Archives - November 2017

Bangladesh BPO Potential Emerging

BACCO president Ahmadul Haque told The Independent that Bangladesh has all the elements to make its BPO sector a success.

“If you look at both India and the Philippines, you will see that despite poor infrastructure and internet connectivity, the BPO industry is expected to continue to flourish, mainly due to abundant English-speaking labour supplies and BPO-friendly government regulations there,” he said.

“In Bangladesh, youths are increasingly turning towards improving their English-speaking skills. The rates of IT and business education have also shot up many times. The government has also pledged to support this industry. All these indicate that we are in the position to take the industry to the next level.”

He said Bangladesh is also evaluating its competitive cost advantage over other emerging countries. “It is located in a geographically advantageous location for BPOs in terms of its time zone. It’s a big plus for us.” Ahmadul said initially, qualified professionals should enter this industry. “This is because we would not be able to get the contracts from the foreign companies unless we can impress them with qualified professionals. Once we get the contracts, we can employ amateur youths and get them trained by the professionals.”

The problem is, he said, there are qualified people here who do not want to take up the jobs because they prefer more secure day jobs, as the BPO sector feels “too temporary”. “But in the Philippines, there are employees who leave their day jobs for higher wages in BPO jobs.”

He added that in the closing day of this year’s summit, some 21,000 curriculum vitae (CVs) were submitted by youths wanting to work or train in the sector during the summit. “These youths are very enthusiastic and eager to join the BPO industry.”

 

Bangladesh hopes to cash in on BPO boom

With a massive young tech-savvy population and good trade relations with most of the countries across the world, Bangladesh has the potential to become a global outsourcing hub, with the capacity to grab a lion’s share of the world’s USD 500-billion business process outsourcing (BPO) market.

The current earnings from the BPO industry total USD 180 million, but experts believe that it could become at least USD 1 billion within the next few years if proper measures are adopted. The two BPO summits in the past two years are a testament to the policymakers’ intention to achieve this, experts added.

Organised jointly by the Information and Communications Technology (ICT) Division and the Bangladesh Association of Call Center and Outsourcing (BACCO), these summits aim to bring the outsourcing sector into the mainstream as well as encourage the country’s youth to become involved in this sector. Another intention is to promote the potential of Bangladesh as an outsourcing destination in the international market.

BPO is a form of outsourcing wherein business organisations contract third-party entities to carry out a specific part of their business processes, such as customer service. This contract is often struck with offshore companies due to the difference in labour costs.

Over the past couple of years, Asia has been the prime destination for outsourced jobs. This has occurred because in Asia, North American—especially US-based companies—can get the services they require at a much more cost-effective rate. Another reason is language, with customer service-related jobs that involve talking or writing in English suiting some Asian nations very well.

As of now, the BPO sector in Asia is more or less a battle between India and the Philippines when it comes to such farmed-out tasks. These two countries are most often the top picks of outsourcing firms, so they are often compared in terms of their standing in the BPO sector. Sector insiders, however, said Bangladesh could be on a par with these two countries, if systematic measures are adopted.

Bangladesh: next BPO destination

The industry operators yesterday tipped Bangladesh to be the next destination for business process outsourcing (BPO). The nation has a large number of young people with an increasing number of IT graduates and the service costs are lower compared to India and the Philippines, which can take BPO forward, they added.

“The demographic dividend is knocking at the door. BPO is the next opportunity for Bangladesh,” said Raihan Shamsi, chief executive of GPIT, at a discussion organised by Bangladesh Association of Software and Information Services (BASIS) at Radisson Blu Water Garden, Dhaka.

The Daily Star was the knowledge partner for the event that was attended by IT entrepreneurs and professionals from home and abroad. The optimism was shared at a time when the $325 million IT and IT enabled services industry in Bangladesh has grown 25 percent in 2012 and registered increased exports earnings.
The country has also emerged as one of the top five destinations for freelancing for IT services.
Some 800 companies operate in the sector supported by a pool of 35,000 IT professionals and 10,000 freelancers, Shamsi said at a session. GPIT has secured a contact worth $16 million for BPO.
He said the global market for BPO is expected to reach $416 billion by 2015.
Bangladesh is in an advantageous position and the country should not miss the chance to increase its share of the pie, he added.

A third of the nearly 16 crore people of Bangladesh are between the age of 15 and 34 years and an increasing number are getting educated. BPO costs here are 40 percent lower compared to India and the Philippines and the government provides support to help the sector grow, he added.

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Business Process Outsourcing in Bangladesh

The country has the potential to create over 200,000 direct and 50,000 indirect jobs and earn about $5 billion annually through Business Process Outsourcing (BPO) – a way of doing business through a third party.  Some 30,000 freelancers in the country are now working through micro sourcing platforms like freelancer, oDesk, e-Lancer and Guru.

This industry could have a great economic impact. Almost 70 per cent of the earnings go away for paying salary alone in the US companies. So they are increasingly becoming interested in BPO deals.

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Bangladesh can be an alternative BPO hub

Bangladesh can be an alternative destination for business process outsourcing (BPO) with its young and dedicated IT talents, said ASM Mohiuddin Monem, chairman of ServicEngineBPO.

The Dhaka-based BPO company has already proved that it is possible to compete with other regional countries such as India and the Philippines that are the pioneer in the industry.

ServicEngineBPO, an entity of conglomerate Abdul Monem Ltd, has been recognised as one of the top 100 global outsourcing companies by the International Association of Outsourcing Professionals or IAOP for the third consecutive year.

It is the only Bangladeshi firm that has been securing a place on the list of “The Global Outsourcing 100” as a “Rising Star” since 2014 for its excellence in the IT industry.

Rapid growth, corporate social responsibility activities and excellent client referrals are the key reasons behind the emergence of the company.

“By now, it is proven that we can perform at global standards and compete with countries like India and the Philippines,” said Monem.

Bangladesh can definitely reach the $5 billion export target of the ICT ministry by 2021, he said, while sharing his company’s achievement as well as his experience in an interview with The Daily Star recently. “IT outsourcing can work as a major catalyst to achieve the export target and help materialise the government’s dream of digital Bangladesh by 2021,” he said.

But to make the sector more competitive the prerequisites are proper marketing support for branding Bangladesh as an alternative BPO hub and export incentives from the government, he said.

The company started its journey with only six people in 2006 and now has a team of more than 500 young talents working 24/7. Their service mantra is “better people, better service and better results”.

One of the unique features of ServicEngineBPO is that around one third of its staff members are young, educated and empowered females.

ServicEngineBPO is also actively engaged in CSR activities in the areas of education, nutrition, wellbeing and environment that has given the company a competitive edge in securing a place on the Global Outsourcing 100 or GO100 for three consecutive years.

“This is not only an achievement for ServicEngineBPO but also for all the IT professionals and Bangladeshis,” said Monem.

The GO100 is an annual listing of the world’s best outsourcing service providers compiled and announced by the IAOP, which released the latest version in June this year.

The IAOP prepares the list by evaluating each company in five areas: size and growth, customer references, awards and certifications, programmes for innovation and CSR.

“We are proud that the IAOP has recognised us as one of the top 100 outsourcing companies in the world. We will continue to flourish in IT and IT-enabled services and help establish Digital Bangladesh through employment generation, export diversification, technological innovation and digitisation,” he said.

“Employees are the hero of our story and we believe that better service is better business,” said Monem, also the deputy managing director of Abdul Monem Ltd.

ServicEngineBPO specialises in back office processing, digital advertising operations, web and software development, data aggregation and analysis, quality assurance and testing and call quality assurance for top US and global companies.

The continuous growth momentum of the industry, global and local recognition and demographic dividend of young talents in Bangladesh have encouraged ServicEngineBPO so much that the company plans to double its workforce and open multiple centres in near future.

Currently it is providing business solutions to more than 30 global clients. It has offices in Bangladesh and the USA. Its future plan is to open more offices in Bangladesh and internationally to attract more global firms. It also expects new work contracts and plans to employ more and more IT talents from Bangladesh.

 

Credit To : Muhammad Zahidul Islam
Source :  Thedailystar.net

Opportunities & Challenges – Bangladesh as a destination

IT Enabled services (ITES), also called web enabled services or remote services or Tele-working, covers the entire gamut of operations which exploit Information Technology for improving efficiency of an organization. These services provide a wide range of career options that include opportunities Call Centers, medical transcription, medical billing and coding, back office operations, revenue claims processing, legal databases, content development, payrolls, logistics management,GIS (Geographical Information System), HR services, web services etc.

The key ITES include: Call Centers, Electronic Publishing, Medical Transcription, Data Centers, GIS Mapping, Portals, ERP( Enterprise Resource Planning ), Knowledge Management & Archiving.

 

Bangladesh and the current ITES scenario

According to studies by Bangladesh Association of Software and Information Services (BASIS), there currently are over 800 IT and ITES companies registered in Bangladesh. The total industry turnover is estimated around 250 million USD. In 2012 BASIS carried out a survey among its member companies showing that over 75 percent of the member companies are involved with customized application development and maintenance. Almost half of them are offering ITES to its customers.

The survey also shows that the majority of the BASIS member companies focus largely in the local IT market. As per BASIS statistics, the Bangladeshi IT service industry has grown at a 20% to 30% per annum during the last few years with banking and other financial sectors being the primary domestic target group for Bangladeshi ICT sector.

Despite strong presence of foreign software solutions in the market, local companies are working on maintenance and implementation of this software. Several companies have also developed software solutions, providing a range of ancillary services related to banking. There is also substantial demand for ITES in manufacturing sectors. RMG industry, textile and pharmaceuticals have created sustainable demand for IT solutions like ERP, HR information systems, and production and financial management software.

Studies estimate that around 200 Bangladeshi ICT companies serve international markets by offering outsourcing services and project delivery models. The BASIS survey shows that out of the exporting member companies the revenue of around one third of these companies is fully export based. In terms of export destinations North America (Canada and the US) dominates, whereas European countries like the UK, Denmark, the Netherlands and Germany have emerged over the last few years to become major export destinations

 

IT Worker Force and Bangladesh

Bangladesh has a population of over 150 million. A significant portion of the population belongs to the productive age group between 16 to 35 years. Therefore, Bangladesh has prosperous population distribution in terms of workforce. The education system of the country is also particularly conducive to producing IT workers. Already, over 15,000 IT engineers are employed in over 400 software and IT service companies, around 150 of these companies are specialized in serving overseas clients.

Specialized IT Education in Bangladesh is well established at the graduation and post graduation levels. Bangladesh now confers academic degrees including postgraduate and doctoral degrees in the ICT subjects in more than 100 institutions including universities, colleges and institutes. Moreover, the 90+ universities in the country produce close to 200,000 graduates each year of which around 14,500 have completed their graduation/ post graduation in IT related disciplines.

In order to communicate with international clients, learning English is a major requirement. In this regard, Bangladesh is already at an advantage. English is taught in schools from the primary level, and is the main medium of education in most universities. As a result, the graduates are well versed in both English and Bengali making them more capable of communicating with clients at both home and abroad. However, certain challenges need to be overcome in order to take full benefits of these advantages that Bangladesh already has.

 

Challenges

For starters, more emphasis should be given on teaching the basics of computer programming at the early academic stages. Computer education in schools is mostly limited to simply word processing, internet browsing etc. A new curriculum should be introduced that incorporates lessons on computer programming that become increasingly advanced as a student progresses into the higher classes.

Also in the university level, IT courses should be introduced for non IT students as well to provide a more comprehensive academic experience. More IT training institutes should also be set up modeled on the pilot programs adopted by the ICT Division.

To ensure that the training is up to the mark, there is no alternative but to issue certificates for programs that are both nationally and internationally recognized and accepted. There is also a need to train instructors who can then impart their knowledge to the students.

A significant proportion of students drop out of schools and either join vocational training institutes or join the informal work sector. By providing English lessons at the vocational institutes alongside IT courses such as programming, graphic design, web development etc, these financially underprivileged students can be given a chance to become important ITES workers and improve their lives as well as contribute towards the country.

 

Opportunities for Bangladesh in BPO

Bangladesh is at an advantageous position in terms of geographical location as well as demographic structure to capture a significant share of the global BPO industry. According to a study by Gartner, the total value of the global BPO market comes up to $300 billion. India is currently the top BPO destination with a market value of $80 billion. Two other Asia nations- Philippines and Sri Lanka are in second and third position, with market values of $16 billion and $2 billion respectively.

Becoming a top BPO destination means Bangladesh has to capture this market currently which is currently under control of these nations.

As mentioned earlier, Bangladesh already has a large pool of skilled outsourcing workers and more international firms are coming to the country seeking an outsourcing solution. Training sessions, workshops, seminars are increasingly being organized by both public as well as private initiatives to encourage more from the young generation to come into this sector, and the response so far has been overwhelming.

With fast pace of change in workplace technology, businesses need to devise newer and innovative ways to streamline their operational processes. Businesses are increasingly switching from having in-house IT Departments to Buying IT As A Service from third party contractors. Moreover, companies are also implementing components of IT to make their operations more flexible and agile.

There are increasing demands for development of SaaS, Platform as a Service etc infrastructure and these are key areas where Bangladesh can venture into and set itself up as a BPO destination.

To avail these opportunities, Bangladesh, as stated earlier, holds certain key advantages.

These include:

 

  • A large number of young IT skilled workforce conversant in English, Bangladesh is one – Asia’s most attractive IT outsourcing destinations after India-particularly for Anglophone countries.
  • Several IT companies in Bangladesh have already built successful track records of working for reputed clients over the world. Currently around 150 IT companies in Bangladesh are exporting to over 30 countries. Out of these IT companies, nearly two-thirds service clients in USA.
  • Bangladesh offers significant cost advantages for IT outsourcing-both in terms of worker-wages as well as cost of infrastructure.
  • Salary of programmers in Bangladesh is 50% of that in India, 40% of Philippines and 70% of the Vietnam.
  • Charges for Internet bandwidth in Bangladesh is currently the lowest on South Asia (50% of that in India).
  • Rent for office space in Dhaka(Capital) is below 20% of that in Delhi and 40% of Manila.

Moreover, the government has declared BPO a thrust sector and has taken several positive steps in promoting the development of this industry. This, coupled with the developments in ICT as part of the government’s vision of a Digital Bangladesh mean that the country has a bright future in BPO. The Bangladesh Government has taken initiatives to build an ICT-driven nation comprising a knowledge-based society. In view of this, a countrywide ICT infrastructure is being developed to ensure access to information by every citizen to facilitate empowerment of people, and enhance democratic values and norms for sustainable economic development. Information technology has become one of the thrust sectors of the government’s short and long-term planning.

Government and private sectors are increasingly going for mass automation with an aim to embrace e-Digital Government with its huge base of skilled resources. Cyber Law and Intellectual Property Rights Law are well-defined, up-to-date and have been formulated in the parliament to cover the agreement required in most outsourcing projects. Moreover, the policy makers are emphasizing on the necessity of financing ICT ventures by banks and other institutions. EEF, a unique venture capital projects finance the ICT and ITES venture with interest free equity partnership. Banks also provide soft-loans for export projects.

European Union’s recent investment in technology infrastructure in Bangladesh has given rise to a wave of start-ups specializing in web and software development.

 

Incentives for working in BPO

BPO can be used as an umbrella term that includes several areas of operation. Typically, salaries and other work incentives vary depending upon the task in question and also the experience of the worker, number of hours worked, level of skill required etc.

A beginner at a Call Centre, for example, can earn around BDT 10,000-14,000 per month initially. With time, this can increase up to BDT 30,000 and above. The pay scale is higher for back office outsourcing such as Finance and Accounting.

A worker providing Finance and Accounting outsourcing services can expect to start with BDT 13,000 per month. Gradually, as the worker becomes more experienced, the salary range could well increase above BDT 60,000.

Similarly, in other BPO areas such as Parma/ Health Care, Supply Chain etc, it is possible to start with a monthly compensation of BDT 10,000-11,000 and gradually earn upwards of BDT 50,000 within relatively short periods of time.

Apart from the attractive salary range, a major incentive of working in outsourcing is the flexibility. Workers can choose their preferred working hours and can also work in outsourcing part time. Students in particular, will find this flexibility specifically beneficial.

It is relatively easy to work for a few hours in outsourcing alongside studies, and many students are increasingly becoming self sufficient through working in this sector.

Those seeking to earn a little more also have the option to set up their own Outsourcing venture after working for a certain period of time. This way, more jobs will be created, and overall contribution to the BPO sector as well as the national economy will increase.

 

Concluding Remarks

Global IT outsourcing industry has been growing steadily in the last decade. The current global economic crisis has led to shrinking IT budgets for corporate, but there has been a continual growth in demand for global sourcing of IT services, with cost minimization being the primary incentive for offshoring services.

The increasing cost pressures, coupled withthe emergence of new service delivery platforms like cloud computing and multiple sourcing, is set to transform the outsourcing industry globally. Over recent years, Bangladesh has made major progresses in laying the groundwork for a diverse and successful outsourcing market. The IT services industry within Bangladesh has been serving international clients and domestic clients in banking and telecom sectors. The industry now employs over 23,000 people, and is exporting services to European, North American and East Asian clients.

The Bangladeshi freelancer community has further supplemented the IT exports by close to US$7 million in 2010 – with Bangladesh appearing consistently in top freelance work locations. Bangladesh offers a vast pool of young, trained and English speaking resources – available at costs almost 40% lower than established destinations like India and Philippines.

Government authorities have demonstrated a determination to promote IT services industry in the country – providing cheaper bandwidth and alternate international cables, setting up Technology parks and providing tax holidays for export oriented industries. The “Digital Bangladesh” initiative of the government is helping setup infrastructure for enhanced connectivity, ICT based citizen service delivery and ICT based Education system.

 

The domestic market is set for growth to support the government initiative of a digital economy, allowing the existing companies to gain scale and expertise in large project execution and services delivery. This would allow Bangladeshi companies to move up the value chain, offering the benefit of operating cost arbitrage to a larger set of services and clients.

In the global marketplace for outsourcing destinations, Bangladesh has positioned itself as a key location for consideration, by enhancing skill availability, investments in infrastructure development, making focused investments and most importantly, by creating success stories.

With all these factors working in Bangladesh’s favor, it is now time to see whether the country can actually seize the opportunities and fully realize its potential in the IT/ITES sector

 

Credits to : Honorable Secretary General, Mr. Towhid Hossain 
Source :   Bangladesh Association of Call Center & Outsourcing
Collection : dailyictnews.com