January 22 2019
India losing outsourcing tag: UK cos shift work
13 July 2011

A high UK jobless rate and a need to better connect with their customers, coupled with rising costs in India, are driving firms such as Aviva, BT and Santander to move work back home.

Last week, another UK-based telecom firm New Call Telecom decided to move its call centre back to Lancashire from Mumbai. On Tuesday, shares of Mphasis fell over 6 per cent as banking group, Santander, moved its retail banking-related call centre services from the Indian vendor back to the UK.

For many, having a UK customer call centre has also become a differentiator in commoditised markets such as voice telephony services, say experts. It is also viewed as 'patriotic'.

"In the current economic climate, it is very good PR to be investing in the UK economy at a time of real economic hardship and high unemployment. To be seen to be 'putting something back in', rather than to be 'taking something out' is likely to be a strong selling point for a brand," said John O'Brien, research director at TechMarketView, in a note.

In the retail banking and mobile telecom sectors, UK-only call centres have become a real differentiator, he added. UK bank NatWest used this as the punchline for an ad campaign some time back. "With UK call centres, it's also easy to manage your bank account" a line on UK bank NatWest's website said.

UK insurer Aviva moved back some jobs from its Indian BPO partner WNS to Norwich, UK, earlier this year. Although it did not give a reason, people familiar with the matter said it was facing quality issues.

UK BPO giants Serco and Capita have also been actively acquiring UK-based and predominantly onshore call centre capability in recent months, according to TechMarketView, which added, "They clearly know the way the tide is turning."

Indian outsourcers, HCL Technologies and Firstsource Solutions, already use onshore capability for voice-based customer-facing roles in UK. Santander is expected to create 500 new jobs in the UK while New Call Telecom will create about 100. Although these numbers seem small in comparison to the over 2 million people employed by the Indian IT-BPO sector, it is a fairly significant number in the UK.

"The whole issue around accents just became really big in the UK, for some reason it was never seen as a problem in the US. It just got highlighted a lot in the UK and then some companies started using it as marketing tool too," said Pramod Bhasin, ex-CEO and non-executive vice chairman of the country's largest BPO firm Genpact.

"It will continue to happen from time to time, due to customer services issues, but given the amount of work that happens in India, it will not be a problem," he said.

A lot of voice-based work, mostly to US-based clients, have moved to Philippines given its cultural affinity to the US and similarity in accent.



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