Short report about offshoring on call centre operation. Summary The Interstate, Inc. was asked to discuss the possibility of offshoring its call centre in order to reduce operating costs and outline the benefits and drawbacks of the four potential host countries. The following short report shows the analysis made by the executives.
Introduction The executives were asked to examine the following facts: - Population: the percentage of young people compared to the total population and the percentage of graduated people as a potential workforce. - Economy: GDP per head, cost of living, competitiveness and operating costs.
Canada After a comparison between the four countries' economic conditions, Canada was immediately excluded. Even though it has cultural values and our same language, Canada would not let the company reduce the costs we are looking forward to because of the high operating costs.
China China has a high number of young people in the main cities, even though only 6% of them attend university of a post-graduation courses. GDP per head and operating costs are low, competitiveness is higher compared to the other analysed Asian countries, but the cost of living is certainly high. However, the main facts that led to China's exclusion are the low level of English speaking skills and cultural differences.
India and the Philippines Both countries can count on a sufficient number of qualified young people, even if it is evident that educational level in the Philippines is generally higher. Competitiveness level and cost of living are really close and, despite Philippines GDP per head is more than twice as India's it remains relatively low. India's operating costs are low, whereas data about Philippines are not available.
Conclusion It is evident that an insurance company call centre requires a qualified workforce who has a great knowledge of English and costumers' assistance culture. It is believed that the most suitable host country is the Philippines. However, considering that the call centre offshoring has the aim to reduce the costs drastically, low operating costs are required. For this reason it is recommended costs are well defined before taking the final decision for a pilot project in Manila. If these costs were to be too high, India would be the most suitable destination.