《思略特(Strategy&):中东地区业务流程外包的高增长机机遇会(2022)(英文版)(16页).pdf》由会员分享,可在线阅读,更多相关《思略特(Strategy&):中东地区业务流程外包的高增长机机遇会(2022)(英文版)(16页).pdf(16页珍藏版)》请在三个皮匠报告上搜索。
1、The high-growth opportunity for business process outsourcing in the Middle EastFrom back office to strategy roomStrategy&|Skin in the game4ContactsDubaiWissam Abdel SamadPartner+971-4-436-Gaurav PagariaPrincipal+971-4-436-Christian StechelPrincipal+971-4-436-Krakw,PolandAdam JamiolPartner+48-12-433-
2、About the authors Wissam Abdel Samad is a partner with Strategy&Middle East,part of the PwC network.Based in Dubai,he is a member of the technology,media,telecommunications,and digital practice in the Middle East.He has served major telecom operators and IT companies in the region for a decade,worki
3、ng on various business-to-business(B2B)information and communications technology(ICT)topics,including growth strategies and go-to-market planning,governance and operating model design,marketing and sales planning,and solutions design and development.Adam Jamiol is a partner with PwC Poland.Based in
4、Krakw,Poland,he is a lead partner in Global Business Services in the Central Eastern European region.He has over 20 years of experience in business transformation.He specializes in advice and support for clients across the world on outsourcing and shared services in multiple.Gaurav Pagaria is a prin
5、cipal with Strategy&Middle East.Based in Dubai,he is a member of the technology,media,telecommunications,and digital practice in the Middle East.He has more than nine years of experience across the Middle East,Southeast Asia,India,and Europe.He has worked on a range of strategic and operational prio
6、rities for B2B ICT clients,including growth strategy,portfolio diversification into IT/digital areas,go-to-market planning,product and portfolio management,and operating model design.Christian Stechel is a principal with Strategy&Middle East.Based in Dubai,he is a member of the technology,media,tele
7、communications,and digital practice in the Middle East.He has more than 15 years of experience in IT and management consulting across Europe,the Middle East,and Africa.His main areas of expertise include strategy formulation,operating model development,large-scale business transformation,and cost op
8、timization for telecom and technology clients.Anish Khandelwal also contributed to this report.Strategy&|The high-growth opportunity for business process outsourcing in the Middle East1Business process outsourcing(BPO)providers in the Middle East,particularly in the Gulf Cooperation Council(GCC)1 co
9、untries,have a significant growth opportunity.The industry is changing,and regional demand is taking off.In the past,BPO was a low-margin business focused on cost optimization.Providers operated call centers and offered such back-office services as payroll and invoice processing.Companies are now of
10、fering more value-added services,and increasingly sophisticated technologies are automating many traditional BPO functions.Until recently,the GCCs BPO market was underdeveloped.That is no longer the case.The GCC market is now growing more than 10 percent annually,which is faster than the expected gl
11、obal growth rate.2 Greater government outsourcing of public-sector services is behind some of that rising demand.We estimate that the GCC market for BPO services could exceed US$2billion in 2025,based on our own calculations and data from IDC,which represents significant opportunity for regional pla
12、yers.3 BPO providers in the GCC need to mature and scale up if they are to grow in this market.These firms will need to decrease their focus on cost optimization,and instead seize the chance to offer value-added services.To compete more effectively,regional players need to change their approach subs
13、tantially,upgrading their technological capabilities,filling the talent gap,and exploiting their knowledge of the regional market.The BPO sector in the GCC can improve public-sector efficiency and delivery,while assisting with more private-sector growth,especially for small and medium-sized enterpri
14、ses(SMEs).EXECUTIVE SUMMARYStrategy&|The high-growth opportunity for business process outsourcing in the Middle East2Since its inception in the late 1980s,BPO has enabled companies to reduce costs,improve operational flexibility,and get to market faster.Companies have been able to outsource core bac
15、k-office functions such as contact centers and payroll.An industry that started out with a few specialized subcontractor companies in India,the Philippines,and elsewhere has since grown into an industry with more than$261 billion in revenues in 2022,according to Grand View Research,a U.S.-based mark
16、et research firm.4In recent years,technology has transformed BPO and what BPO providers can offer their clients.BPO companies are moving beyond the purely transactional into more sophisticated,value-added services.Technology has automated some of the traditional tasks performed by BPO providers.Invo
17、ice processing,a previously time-consuming manual activity,is one example.Such technologies as optical character recognition and robotic processes now scan invoices,digitize them,and process them faster than humans can.BPO also has moved from the back office to the strategy room.The development of d
18、ata analytics and artificial intelligence(AI)means that BPO providers can increasingly generate leads,cross-sell,sell more to existing customers(upsell),and even assist with C-suite recruitment.The employee search process is now faster and cheaper.Technology helps companies recognize,screen,and shor
19、tlist candidates in a streamlined and systematic manner.Companies can thus access a larger pool of candidates.How BPO companies are compensated for their services is also changing.In the past,clients measured BPO firms on a narrow set of performance indicators and paid them through fixed-price contr
20、acts.Today,however,incentives between BPO providers and their clients are more closely aligned.Clients are seeking innovative pricing and deal structures.For example,instead of paying for a call center based on the number of staff engaged,the industry is moving toward reimbursing the BPO provider fo
21、r the value of cross-selling or upselling,or for improved customer retention.Technology has also enabled new business models and resulted in the emergence of new and smaller BPO players.For instance,startups are able to serve new customer segments such as small and medium-sized enterprises(SMEs)thro
22、ugh the cloud by offering them business-process-as-a-service.Several BPO providers now offer software-as-a-service solutions for accounting,human resources,or procurement management.They tailor these solutions to the needs of SME customers with subscription-based pricing that does not require length
23、y up-front commitment or investment.These technologies also make BPO providers leaner because they do not need dedicated staff to handle these clients.THE TRANSFORMATION OF BPOThe result of the changes described above is increased demand for BPO services.The global BPO markets annual rate of growth
24、was about 6 percent between 2017 and 2021.That is likely to accelerate to a 9.1 percent compound annual growth rate between this year and 2030,according to Grand View Research,with global sector revenues in 2030 forecast at$525.2 billion.5 Growth in the GCC for BPO services will be even faster.We es
25、timate,based on our own calculations and data from IDC,that the GCCs BPO market will grow by a compound average of 10.5 percent per annum to 2025making it worth$2.1 billion in 2025(compared with$1.4 billion in 2021).6Several region-specific factors are fueling GCC demand.GCC governments are seeking
26、more private-sector participation in the provision of public services to fulfill such policy objectives as improving skills and increasing employment of nationals.In Saudi Arabia,for example,the Ministry of Communications and Information Technology has launched an initiative to subsidize the salarie
27、s of nationals employed in the private sector for an initial period of one to two years,with the goal of raising skill levels and boosting employment in the countrys Tier Two and Tier Three cities.GCC governments are also privatizing some government services,which creates demand for BPO services.For
28、 example,Saudi Arabia is looking to privatize a number of government assets and services to enhance the quality and efficiency of public services in certain sectors as part of its Saudi Vision 2030 development program.7 The government has more than 100 privatization initiatives that cut across the a
29、reas covered by 10 ministries.In the United Arab Emirates,Mubadala has long operated a joint venture with Electronic Data Systems known as Injazat Data Systems to provide BPO services and make government services more efficient.THE GCC MARKET FOR BPO SERVICES IS GROWING FASTGCC governments are seeki
30、ng more private-sector participation in the provision of public services to fulfill such policy objectives as improving skills and increasing employment of nationals.Strategy&|The high-growth opportunity for business process outsourcing in the Middle East3BPO support is also necessary for the specia
31、lized entities that governments are creating to fulfill specific public-sector mandates.These new entities often do not have well-established procurement,human resources,finance,or other support functions.They also rely on third parties to jump-start their capability building.One example is Monshaat
32、,the Small and Medium Enterprises General Authority.The Saudi Arabian government created Monshaat to help SMEs access the financing that they generally cannot obtain from traditional financial-services providers.Monshaat is relying on third parties to provide its support functions while it focuses o
33、n core activities.Another example is the BPO support that will be required for the 30 companies being created by the Public Investment Fund,Saudi Arabias sovereign wealth fund.The companies are part of an“investment pivot”to boost private-sector activity in 13 sectors including construction,financia
34、l services,entertainment and leisure,and aerospace and defense.Also increasing demand for BPO services is the promotion of SME and startup activity,along with the regulatory push for greater localization.Larger SMEs will need help with support functions as they expand.There is a strong case for such
35、 companies to start outsourcing non-core activities as soon as possible so that they can focus on growth.An energized BPO sector in the GCC could increase public-sector efficiency and lead to more private-sector growth,particularly for SMEs.The push to employ more nationals is also fueling the BPO m
36、arket.It is often easier for organizations to outsource certain processes than seek to acquire scarce talent because nationals with the correct skill sets are sometimes in short supply.For example,the Ministry of Labor in Saudi Arabia is requiring the“Saudization”of some functions,which has led to i
37、ncreased outsourcing to Saudi-based BPO providers.BPO is also an opportunity for women to find work,which is important as Saudi Arabia seeks to encourage female participation in the workforce.8 Strategy&|The high-growth opportunity for business process outsourcing in the Middle East4Strategy&|The hi
38、gh-growth opportunity for business process outsourcing in the Middle East5The BPO industry in the GCC is small by global standards,is traditional in its offerings and charging models,and lacks the necessary technological capabilities to offer new,higher-value-added services.BPO revenues in the GCC c
39、ountries are equivalent to around 0.1 percent of GDP,compared with 0.4 percent in more developed markets(see Exhibit 1).9 GCC BPO players tend to focus on traditional back-end services.Using old pricing models,they offer a limited range of services and niche segments,rather than competing head-on wi
40、th international players that offer a breadth of end-to-end services.To seize the BPO opportunities,the regions providers need considerable growth and investment in technology.BPO providers also need to find the tech talent necessary to deliver high-value-added services.Currently,we estimate that th
41、e region employs just 50,000 to 70,000 professionals in BPO,which we believe can double in the next three to five years to meet growing demand.THE STATE OF BPO IN THE GCCEXHIBIT 1The BPO market in the GCC is underdevelopedBPO market revenue,%of GDP(2021)BPO market revenue,%of ICT sales(2021)Note:UAE
42、=United Arab Emirates.Source:World Bank;Statista“Business Process OutsourcingWorldwide”(https:/ 0.3%Average 5.6%0.49%0.73%0.13%0.23%0.10%0.29%U.K.U.S.JapanMexicoIndiaChinaUAESaudiArabiaSouthAfricaU.K.U.S.JapanMexicoIndiaChinaUAESaudiArabiaSouthAfrica11.39%8.40%7.20%5.22%6.15%3.84%3.62%3.08%1.42%EXHI
43、BIT 2Six initiatives for BPO growthSIX INITIATIVES FOR BPO GROWTHThe regions BPO providers need to take six initiatives in order to capture GCC market opportunities(see Exhibit 2).Each initiative requires action in multiple areas to position BPO providers for success:Find and train talentInvest in t
44、ech automation and advanced digital capabilities Create innovative business modelsAdopt a product management mindsetBuild business development capabilitiesSeek partnerships to achieve scale Source:Strategy&05Build business development capabilities06Seek partner-ships to achieve scale02Invest in tech
45、 automation and advanced digital capabilities04Adopt a product management mindset01Find and train talent03Create innovative business modelsKey actionsWe estimate that the region employs just 50,000 to 70,000 professionals in BPO,which we believe can double in the next three to five years to meet gro
46、wing demand.Strategy&|The high-growth opportunity for business process outsourcing in the Middle East6Find and train talentThe new nature of BPO demands a more skilled workforce with particular aptitudes.The risk is that the regional talent shortage in the GCC could hamper growth.BPO providers and s
47、takeholders must invest in building and maintaining a talent pool and pipeline to overcome this talent challenge.For BPO providers,this means more focus on training of existing workers,on external hiring,and on a value proposition that retains top performers.Training BPO providers need to train thei
48、r workforces and increase skill levels.Companies can improve the skills of employees by rotating them through multiple functions and capabilities so they gain exposure to the changing nature of BPO services.They can also retrain employees for newly required skills,and use partnerships with education
49、al institutions offering the relevant courses.External hiring BPO providers need to hire externally if new capabilities such as advanced technological skills are required,or when training the existing workforce is difficult.Sometimes,BPO providers have to hire senior functional experts from outside
50、the industry.One way to source new talent is to certify training programs in partnership with educational institutions and training providers.Such programs,along with educational partnerships,can provide a pipeline of new talent.Talent retention BPO providers will have to hold on to their best emplo
51、yees if they are to institutionalize new processes and higher-value-added services.They must present robust support for top performers and an attractive value proposition.Companies can review their performance management framework to ensure they offer adequate incentives for high performers.They can
52、 also use mentorship programs,and chart out faster career progression for staff who excel.Strategy&|The high-growth opportunity for business process outsourcing in the Middle East7Invest in tech automation and advanced digital capabilitiesTo keep pace with their competitors,BPO providers in the GCC
53、should raise their investment in building digital capabilities and integrate technologies such as AI,data analytics,and cloud capabilities into their daily activities.Technology adoption is a critical factor in enabling new value-added services,capturing new customer segments,and delivering an enhan
54、ced customer experience.In the traditional model,BPO providers used macros and scripts to automate repeatable structured processes through rule-based automation in a specific application.They used business process automation and robotic process automation(RPA)to make workflows efficient and minimize
55、 costs by integrating software and restructuring labor.In the future,however,BPO providers have three potential opportunities:switching to cloud-based delivery models,adopting RPA and AI,and using blockchain(see Exhibit 3).EXHIBIT 3BPO service providers are increasingly investing in technology autom
56、ation and advanced digital capabilitiesAdvantages of adoption of tech and digital capabilitiesNote:AI=artificial intelligence,RPA=robotic process automation.Source:Strategy&CLOUD COMPUTING(current and trending)-Reduces IT investments and cuts costs-Improves processing time-Increases operational flex
57、ibilityRPA COMBINED WITH AI(trending and future state)-Improves productivity-Reduces errors-Increases business flexibilityBLOCKCHAIN TECHNOLOGY(future state)-Ensures safe encryption of data-Increases control of data and transparency-Enables real-time access to accurate customer dataStrategy&|The hig
58、h-growth opportunity for business process outsourcing in the Middle East8Cloud-based delivery models Cloud-based delivery allows BPO service providers to offer on-demand or needs-based infrastructure to their customers.It also significantly reduces the IT investments demanded of BPO providers.BPO pl
59、ayers can use cloud computing to reduce processing time for data-intensive business processes.Several providers globally and in the GCC are offering cloud-based call center solutions to their customers as an alternative to on-site call center installation.For BPO providers,the result is a shift in c
60、osts from capital expenditure to operating expenditure.This approach also allows for faster deployment,frequent updates,higher reliability,flexibility in terms of capacity and payments,and location independence.Cloud-based delivery does pose some challenges.BPO providers will have to engage with dat
61、a sovereignty,which impedes growth and adds to costs by demanding the storage of data in-country.Providers must master the regions complex data privacy laws.They should also push for regulatory and legislative frameworks that will enable the sectors growth.Adopting RPA and AI BPO providers are using
62、 automation via RPA and AI to replace manual tasks and improve productivity.Advantages include fewer errors and less need for staff.One leading BPO and knowledge process outsourcing provider in the GCC recently used automation and RPA to identify staff qualified to handle certain billable client pro
63、jects.The automated solution enabled the BPO provider to respond to client requests five times as fast as it could using a manual process.Previously this process was done by hand and required searches of about 2,500 staff records with details of which staff were available,or already assigned,and the
64、ir qualifications and capabilities.Using blockchain Blockchain is a distributed ledger technology that safely encrypts data.Although the BPO sector is only starting to use blockchain,some technology players are offering blockchain-driven customer interaction services to BPO companies.Such services e
65、nsure that customer data is stored in an encrypted and secure manner.The use of blockchain can contribute to improved cybersecurity practices.Create innovative business modelsBPO providers need to come up with new,flexible business models to accommodate changing customer expectations and their own a
66、bility to deliver value-added services at a higher level.The BPO industry and its customers are finding the“cost-plus”model that was focused on cost efficiencies less attractive.New approaches examine the opportunities that come from customer life-cycle management.For example,customers increasingly
67、prefer to link part of the pricing for outbound call centers to metrics that relate to the benefits delivered,such as new sales or lead generation.Leading providers are offering outcome-based models and revenue-sharing agreements.BPO providers in the GCC need to adopt these new models.To do so,they
68、have a range of possibilities to test and implement them.On the management front,providers can create a team focused on pricing,solutions,offer design,and bid managementincluding hiring experts who are experienced in structuring new business modelsthat will propose new models.On the operational fron
69、t,BPO providers can adjust their internal processes to implement revenue recognition and reporting for new business models.On the customer front,they can educate clients on the benefits and advantages of different business models and pilot new approaches with selected customers.Strategy&|The high-gr
70、owth opportunity for business process outsourcing in the Middle East9Adopt a product management mindsetBPO providers in the GCC need to think about how they can evaluate their offerings continuously,rather than stick to a fixed menu.Such a product management mindset is vital for BPO providers that w
71、ant to stay relevant and differentiate themselves.They need to redesign their product and service portfolio regularly in order to serve changing customer requirements through innovative products and services.For example,within customer life-cycle management,there has been a shift from single channel
72、(voice calls)to multichannel customer management.To achieve this,BPO companies are provisioning a single solution or platform that integrates and enables the management of all points of customer interaction across channels such as voice calls,text,email,and social media.Future changes could include
73、adding AI-enabled digital modes of communication to traditional voice and interactive voice response methods,providing a richer and more efficient customer experience.Build business development capabilitiesBPO providers should invest in business development capabilities so that they can educate the
74、regional market on the new,higher-value-added outsourcing.Although the growing number of SMEs and startups provides new potential customers,BPO companies still need to convince these businesses of the value of their services.BPO providers therefore should invest in business development capabilities
75、such as consultative selling,which involves providing advice and guidance to customers.Seek partnerships to achieve scaleBPO providers need partnerships to scale up so that they have the resources to invest in advanced capabilities and provide advanced services.The GCCs BPO industry is too small to
76、achieve the scale required in the near future through organic growth.BPO providers have a number of options.They could build go-to-market partnerships with large telecom players to take their offerings to a much larger base of customers.They could establish a presence through digital channels as a m
77、eans of increasing reach with minimal in-person contact.They could also use third-party resellers to reach SMEs and other smaller customers.BPO providers could also use partnerships to improve delivery effectiveness and efficiency.For example,BPO providers could automate tasks in the short term by p
78、artnering with RPA companies.Over the long term,BPO providers could develop more in-house capabilities.Strategy&|The high-growth opportunity for business process outsourcing in the Middle East10Strategy&|The high-growth opportunity for business process outsourcing in the Middle East11CONCLUSIONBPO p
79、roviders in the GCC region have an important opportunity ahead of them.They are in an industry that is transforming and in a region with rapidly rising demand for their services.Although the GCCs BPO industry is smaller than it should be,industry leaders can reach the necessary scale by investing in
80、 technology and talent,elaborating new business models,and changing their mindset to develop business and form vital partnerships.As the GCC economies grow and become more sophisticated,so can the regions BPO industry.Strategy&|The high-growth opportunity for business process outsourcing in the Midd
81、le East121.The GCC countries are Bahrain,Kuwait,Oman,Qatar,Saudi Arabia,and the United Arab Emirates.2.Statista forecasts the global growth rate at 6.69 percent average for 2022 to 2027(https:/ GCC figure is a Strategy&estimate based on its analysis of GCC markets and using the Saudi Arabia figure f
82、rom Mufasir Yousuf and Mohammed Azim Ansari,“Saudi Arabia IT Services Market Forecast,20212026,”IDC,July 2022Market ForecastDoc#META47720022(https:/ note that IDC is not associated with the Strategy&forecasts in this paper.3.Strategy&analysis and Alison Close,“Worldwide and U.S.Business Process Outs
83、ourcing Services Forecast,20212025,”IDC,May 2021Market ForecastDoc#US46369221(https:/ View Research,“Business Process Outsourcing Market Size,Share&Trends Analysis Report by Service Type(Customer Services,Finance&Accounting),by End-Use(IT&Telecommunication,BFSI),by Region,and Segment Forecasts,20222
84、030,”Report ID:GVR-2-68038-484-0(https:/ and Alison Close,“Worldwide and U.S.Business Process Outsourcing Services Forecast,20212025,”IDC,May 2021Market ForecastDoc#US46369221(https:/ Vision 2030(https:/www.vision2030.gov.sa/v2030/vrps/privatization/),Privatization Program(Delivery Plan 2020),A Saud
85、i Vision 2030 Realization Program(https:/www.ncp.gov.sa/en/MediaCenter/News/Documents/Privatization%20Delivery%20Plan%20_ENG.pdf).8.“TCS takes full control of all-women BPO center in Riyadh,”consultancy-,February 5,2021(https:/www.consultancy- and the World Bank,Statista“Business Process Outsourcing
86、Worldwide”(https:/ Yousuf and Mohammed Azim Ansari,“Saudi Arabia IT Services Market Forecast,20212026,”IDC,July 2022Market ForecastDoc#META47720022(https:/ Close,“Worldwide and U.S.Business Process Outsourcing Services Forecast,20212025,”IDC,May 2021Market ForecastDoc#US46369221(https:/ high-growth
87、opportunity for business process outsourcing in the Middle East13Strategy&Strategy&is a global strategy consulting business uniquely positioned to help deliver your bestfuture:one that is built on differentiation from the inside out and tailored exactly to you.Aspart of PwC,every day were building t
88、he winning systems that are at the heart of growth.We combine our powerful foresight with this tangible know-how,technology,and scale to help you create a better,more transformative strategy from day one.As the only at-scale strategy business thats part of a global professional services network,we e
89、mbed our strategy capabilities with frontline teams across PwC to show you where you need to go,the choices youll need to make to get there,and how to get it right.The result is an authentic strategy process powerful enough to capture possibility,while pragmatic enough to ensure effective delivery.I
90、ts the strategy that gets an organization through the changes of today and drives results that redefine tomorrow.Its the strategy that turns vision into reality.Its strategy,made the latest Ideation Center insightsConnect with Strategy&Middle E with Strategy& 2022 PwC.All rights reserved.PwC refers
91、to the PwC network and/or one or more of its member firms,each of which is a separate legal entity.Please see for further details.Mentions of Strategy&refer to the global team of practical strategists that is integrated within the PwC network of firms.For more about Strategy&,see .No reproduction is permitted in whole or part without written permission of PwC.Disclaimer:This content is for general purposes only,and should not be used as a substitute for consultation with professional