StartUp Vies for Outsourcing Pie 3070

sci.econ:255857 sci.research.careers:77193 soc.culture.british:1203302

(AllAfrica.com English Via Thomson Dialog NewsEdge)Nairobi, Feb 28, 2006 (The Nation-All Africa Global Media via COMTEX) --As Kenya grooms itself as Business Process Outsourcing hub, Preciss Services already provides data processing and transcription services for clients in Britain, Canada and the US

In the world of international outsourcing, India, the Philippines and some Caribbean countries have attracted most of the attention, and reaped most of the benefits.

Companies in fields like software, banking and even medical services have taken advantage of business process outsourcing (BPO) in places that may be far from their customer bases, but can provide well-trained labour at a huge savings.

The trend has not gone unnoticed in Kenya, and Preciss Services is at the forefront of an effort to make the country a more attractive BPO option. From a two-person start-up in 2002, Preciss now employs 17 people, providing data processing and transcription services for clients in the UK, Canada and the US.

Ms Mugure Kabugua Mugo, managing director for E-business Solutions, Preciss's parent company, said Kenya's advantages in the BPO world include a time zone that appeals to both US and UK-based clients, but more than this it's the highly educated workforce and good English skills that make the difference.

"We have send people," she said. "They are people with work ethics, they are people who are able to work on a shift-basis."

Turning a profit, just over a year after formalising its outsourcing activities, Preciss achieved its success by starting small, and focusing on areas it knew it could handle at first. Early contracts were for simple on-line research, which required little more than an Internet connection and a few staff.

Ms Mugo recalled that she even offered services at no cost to new clients, but later altered that to a discount on the advice of one of their first US-based customers.

Preciss today handles data processing such as database management and e-mail, while its transcripts arm transcribes business meetings for financial services clients, and does subbreastling and captioning of educational and religious videos. It has six contracted full-time clients and an array of "project-to-project" work as well.

The challenges are many in convincing foreign firms to trust a largely untested African country to outsource key services. Aside from low visibility and increasing compebreastion on the continent from Egypt, South Africa and Mauritius, Kenya continues to be hobbled by its backward telecommunications infrastructure.

While another Kenyan company, KenCall, has found success providing call-centre services, Ms Mugo argued that until fibre-optic cable comes to Kenya - something the Government says will occur in 2007 - voice-related BPO services here will be limited.

"Companies abroad are not likely to outsource high volume voice work if there's no fibre optic, so we need to look at our infrastructure," she said.

The Ministry of Information and Communications, which is holding a conference on Kenya's Information and Communications Technology (ICT) strategy today, has featured Preciss as an example of Kenya's BPO potential, and the company has been actively engaging with the ministry to help the fledgling industry take off.

Information and Technology Permanent Secretary Bitenge Ndemo recently announced plans to create 30,000 jobs in outsourcing. It's part of a broader plan to make Kenya the region's ICT hub, and increase the sector's earnings to 10 per cent of the economy.

As part of the Ministry-directed activities, Preciss has consulted with Nairobi University to bring more BPO-relevant training into their curricula. Ms Mugo said that they hope to consult more universities and is positive that change will happen soon, "because at the end of the day (universities') work is to train and if they can train for an industry that looks like it is promising in terms of jobs for their graduates, then they are very interested."

Having more players in the Kenyan BPO world will also help lure foreign firms, said Preciss' director of operations Joe Kigara. So would luring one or two big names like Dell into setting up shop here.

While it is counting on the Government to help overcome infrastructure and training issues, Preciss's own plans include widening the variety of services it offers to move into call-centre services for a client she wouldn't name.

Last week in a quiet room in the company's offices on Muchai Drive, young male and female employees with headphones were rapidly keying in subbreastles for Western movies and transcribing a teleconference for a US-based client.

But the current staff of 17 is less than half of the double-shift potential of 40 at the company, said Ms Mugo. She said while the subbreastling and transcription arm is busy with work, she sees the data processing side as having more potential for growth and employment. In the Kenyan context, she said that if properly nourished, BPO can grow to rival agriculture and tourism as a major source of foreign exchange in Kenya.

"We are operating in an industry that's growing globally and, as a country, we are waking up to it and we have many of the prerequisites," Ms Mugo said, adding that BPO "has the potential to employ many Kenyans and have an impact on poverty levels.

Mr Kigara added the Government's support for the sector is easy to understand due to the potential for quick growth and revenues.