When Culture Helps Innovate Customer Engagement: The South Africa Example

Mar 12, 2015

On my fourth visit to South Africa, I attended the March, 2015, "Offshoring South Africa" Conference in Cape Town, where I sat on a panel to discuss "The Future of Customer Service". The conference was organized by BPeSA (Business Process enabling South Africa).

One theme I touched upon during the panel discussion is the central role that culture plays when it comes to success in business, and perhaps how innovation will have as much of an influence within this realm of culture going forward as it will in the realm of technology. We've been thinking and writing about this theme at Frost & Sullivan over the past year, and the conference was an excellent forum at which to develop the idea of the essential role of culture in the Business Process Outsourcing (BPO) equation specifically.

In fact, listening to some excellent speakers during the conference helped me clarify two primary ways in which culture can be at the root of success or failure in BPO:

Sourcing Location: Cultural Considerations

Culture is an important factor when considering various global sourcing locations, and South Africa has much to offer on this score. It's clear that a "community focused-ideal" helps shape the South African psyche. I learned that the idea of "Ubuntu", a term roughly translating to "human kindness" ("I am who I am because of who we all are"), of family and community, infuses the local culture and helps make it distinct. South Africa also is known for its solution-seeking mindset ("a farmer makes a plan"). Such qualities mean there is a deep pool of talented young people across what Professor Leslie Willcocks and Andrew Craig call "South Africa's BPO Service Triad" – the three distinctive, complementary locations of Cape Town & the Western Cape; Durban & KwaZulu-Natal; and Johannesburg & Gauteng.

Consider the example of Microsoft. At a Rockefeller Foundation event I attended in Johannesburg in November, 2014, "Impact Sourcing at Scale: Moving from Idea to Practice", Renee Yoakum, GM for Consumer Support for Microsoft, emphasized that the essence of her mission is simple – to serve customers well. Hence Microsoft's investment in South Africa; when it comes to the English language, Yoakum noted that, "the English here (in South Africa) is beautiful", and the quality of empathy also is something special. There is a "humble self confidence" exhibited by the people of South Africa that is absolutely key when it comes to providing great customer service. This message was reinforced at the Impact Sourcing event in remarks by Maryana Iskander, CEO of the Harambee Youth Employment Accelerator.

Corporate Culture

As I listened to Guy Lundy of Odgers Berndston talk about the importance of developing emotional intelligence in employees ("EQ"), it struck me that just as people have EQ, so too do organizations. Over the years, I've studied BPO providers that do and those that don't possess this quality of emotional intelligence.

Why is this important? Smart companies understand the importance of a great culture for their employees. I'd suggest that this is especially true in the BPO industry. Consider that the link between culture, employee engagement, and business outcomes in the BPO industry is an intriguing theme that the Frost & Sullivan Customer Contact research team has encountered repeatedly during ongoing conversations with many different enterprises, from TELUS International to Teleperformance. In fact, Frost & Sullivan recently developed a white paper on this idea with TELUS International entitled, "The Culture Value Chain: Business Impacts Defined," where we consider the direct correlation between employee engagement and revenue growth for organizations with great corporate cultures. There are a growing number of clear examples where highly engaged team members create superior experiences for their customers (think of the Apple Store, the Zappos online retail experience, or grocery shopping at Wegmans Food Markets). For those companies, the business benefits of an outstanding Customer Experience can be considerable. So too in the BPO industry.

In fact, during this, my third visit to South Africa in a year-and-a-half, it struck me that the BPeSA network under Gareth Pritchard's stewardship appears to be fostering an environment where a positive corporate culture is thriving, redounding to the benefit of the many international clients of the BPOs based there. Touring the Merchants and Webhelp facilities the day following the conference was particularly instructive.

Merchants, a Dimension Data company, has over 4,000 seats in South Africa. And Merchant's Business Development Director Lisa Roos gave a tour of one of the most innovative facilities this analyst has seen in over a decade covering the BPO space. Roos has managed a range of accounts in the offshore BPO space and knows well the pressures international clients face. The layout of the Merchants center was not only elegantly modern, clean, sunlit, and utterly welcoming, but there also was a real sense of enthusiasm and productivity in the air. Such an atmosphere goes a long way toward helping employees thrive.

The tour of the Webhelp facility that followed was similarly impressive. Craig Gibson, CEO of Webhelp South Africa, explained that the company had gone from a "standing start" to 1,000 agents within just a year. It now provides 1,600 jobs in South Africa. Despite inevitable pressures that come with rapid growth, Gibson has maintained a stable workforce delivering high customer satisfaction (CSAT) and Net Promoter Scores (NPS) for clients. He was also realistic, noting that there are very real social issues in South Africa, as there are in so many other places across the world today, and the social divide is widening. Therefore it is all the more important that employees have a welcoming and stimulating place to work. The modern, open layout of the Webhelp facility did not disappoint.

In effect, it became clear that what Merchants and Webhelp are doing is to help nurture their people. And visiting their centers in Cape Town reminded me of a presentation by Ms. Pumela Salela, a consultant to the World Bank, at the November, 2014, Rockefeller Impact Sourcing event. Ms. Salela spoke eloquently about how important it is not only to create employment opportunities for young people, but to truly nurture their talent and qualities of leadership as well. It's obviously a priority for the BPO industry in South Africa.

Indeed, this message is echoed by other providers in South Africa. For example, at one of the BPeSA conference sessions, Franco Cotumaccio of Capita, which has grown to 1,500 people in South Africa (much of that in the past year), pointed out that people development is a priority, and that Capita is investing in middle management programs to help in that process. Cotumaccio also noted that due to the friendliness and rapport of South Africa's young people – that quality of "humble self confidence" that seemed to become a theme of the Impact Sourcing event in November – voice and chat are real core competencies for Capita in South Africa.

Summary: Valuing Culture, Innovating Customer Engagement

At the November, 2014, Impact Sourcing event in Johannesburg, Maryana Iskander used the term, "the power of convening", of bringing talented and motivated people together, which strikes me as an excellent way to describe what is happening in South Africa today when it comes to the BPO industry. As Iskander pointed out, "the power of getting things done comes from people from different spheres convening." It's a lesson Penny Bongato, Executive Director of Talent Development at IBPAP in the Philippines, spoke to the conference about in relation to the success of the BPO industry in the Philippines.

In essence, when it comes to places such as South Africa and the Philippines, we may be entering an era in the BPO industry where, more than ever, culture is being understood as being absolutely fundamental to the bottom-line. The clustering of organizations such as BPeSA, under the leadership of CEO Gareth Pritchard, with the Rockefeller Foundation and the likes of Merchants, Webhelp, Capita, Serco, Teleperformance, WNS, Aegis, Mindpearl, Coracall, and others, seems to be fostering a somewhat unique environment (perhaps in some ways akin to that of the Philippines) where the possibilities inherent to culture are encouraged to flourish, helping to innovate Customer Engagement (and other aspects of BPO). In today's highly competitive world, that is no small accomplishment.

Stephen Loynd


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