issue 1 - Roland Berger

p industry report
70 percent of traditional business processes will be outsourced in the future
employees working in the original center in
the provincial town of Vasvár had reached
their production capacity limit. Now, in
4,500 square meters of office space, 300 IT
specialists handle primarily financial tasks
for customers from 17 countries. One of the
best-known customers is Infineon. The
Munich-based semiconductor manufacturer
has signed a 10-year contract with EDS.
From its Hungarian facilities, EDS handles
the administrative aspects of Infineon’s
recruitment, trainee support, and payroll
operations for its 20,000 German and
Austrian employees. For László Szakál, an
EDS manager in the country, this is merely
the beginning. Other large-scale contracts
from international companies will cause the
center’s number of employees to climb
quickly to 1,000.
Back-office processes such as finance,
human resources and accounting still make
up the lion’s share of offshore projects. They
constitute “about 60 percent of the ongoing
or planned projects,” says Karl Sauvant,
the offshoring study’s author and director
of UNCTAD’s investment division. However,
one-quarter of the surveyed large-scale
enterprises also outsource front-office
services or, in other words, services with
direct customer contact. According to
CENTRAL EUROPE HAS A NUMBER OF
ADVANTAGES COMPARED WITH
ASIAN OFF-SHORE LOCATIONS
another study, conducted by Datamonitor,
call centers have the highest growth rates.
The study claims the number of call center
positions in Central Europe will increase
from 4,400 currently to 13,700 in 2008.
Language barriers are few. Central European
call center agents learn foreign
languages almost perfectly, usually thanks
to study visits abroad. Companies such as
British Telecom are taking advantage of
these skills. In 2004, BT opened a branch in
Warsaw, Poland, to offer “contact center outsourcing”
in addition to providing its entire
range of communications services.
To top this all off, employees in the Baltic
countries have a handle on Nordic
languages. After taking over the Swedish
hotel chain Scandic in 2001, managers of
the Hilton hotel chain were pleased to
discover that many Estonians also speak
Swedish or Finnish. Today, 120 phone
agents in a Hilton call center in the Estonian
capital of Tallinn take reservations
from their Scandinavian guests in the
guests’ languages.
Michael Corbett, initiator of the annual
European Outsourcing Summit, is positive
that offshoring will continue to grow. He
predicts, “Seventy percent of the traditional
business processes will be outsourced in the
future.” Why should one rely on this type of
strategy? According to the UNCTAD study,
more than 80 percent of the surveyed companies
realized cost savings of between 20
and 40 percent through offshoring.
Tallinn, Estonia: “Foreign languages pose few difficulties in the Baltic states.”