Page 77 - IBT Sept 2021 (1)

Outsourcing Industry
By Nobonita Roy September 2021
Resource its journey in 2009, the industry has been on
an upward trend over the years, mostly on the
backs of a strapping IT infrastructure, legal
Diversified documents, international business
development, and skilled human resources. It
also makes sense from a client standpoint –
what would cost a foreign client a fortune to
execute locally can be done by Bangladeshi
freelancers at a fraction of the cost, with both
parties walking away happy from the
transaction. Because of this, Bangladesh has
been becoming more and more attractive as an
outsourcing destination over the years. This
certainly merits a closer look at the change that
has come. The reasons behind the change
deserve deeper observation, along with the
pondering of further steps that can be taken to
improve efficiency, scope, and the overall
current state of affairs.
A Look at the Numbers
The outsourcing industry of Bangladesh began
with a mere 300 people only a decade ago,
growing exponentially to over half a million
just within a decade. From an annual
outsourcing-based income of USD 12 million in
2012, the growth has been steady, reaching
USD 160 million in 2016, and then rising to a
staggering USD 399 million in 2018 – a 33%
growth rate in just ten years. Right now, the
number stands at a mammoth USD 400 million
in revenue, from both local and international
clients. On average, over 20,000 new people
join the Bangladeshi outsourcing industry
every year, boosting the BPO sector even more.
Aside from individual freelancers, a significant
number of companies specializing in this kind
of work have also entered the scene, in
50 years of Bangladesh’s numbers far greater than ever before.
It is quite difficult to evaluate the exact size of
outsourcing industry is the the BPO industry because it is not a separate
borough entirely. However, an overall look at
prequel that set the stage for the numbers suggests that there are currently
Digital Bangladesh refers to deploying business-related operations, over 500,000 individual freelancers and more
than 2,500 agencies involved in providing
whether technical or non-technical, to external outsourced services to both local and
service providers. Technology is usually at the international clients. Bangladesh is currently
crux of these outsourcing processes, and the one of the top countries that provide diverse
With Bangladesh entering its fiftieth year of IT-intensive processes that generally tend to be high-quality services and offshore centers at
independence this year, it is time to visit one of the key homogenous across companies and are usually some of the lowest and most competitive costs
forces that has been dominant over the course of these the main tasks that get outsourced. in the world, in line with Vietnam, the
years – the not-so-distant dream of a Digital Bangladesh. The prominence of Bangladesh’s outsourcing Philippines, and India. It is not hard to
A key driving area of this Digital Bangladesh has been industry has grown significantly, especially over understand that this has definitely helped
the Business Process Outsourcing industry, otherwise the past couple of decades, reaching new heights boost the aforementioned numbers.
known as BPO. For those wondering what BPO is, it of success with every passing year. Since starting With more than half the population being
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primely suited for the working class, the BPO industry has
seen tremendous growth over the past ten years. The Digital
Bangladesh development project has also been a high-priority
focus for the government, further fueling the growth of this
lucrative sector. One of the most critical ways in which the
Digital Bangladesh movement has helped the BPO industry is
the initiative to boost internet accessibility to the masses,
moving from around 1% to 60% penetration in a very short
time, while bringing down internet access costs to a mere 1%
of what it used to be.
The ICT Secretary of the country had mentioned that around
126,000 employees are currently working in the IT sector.
However, if we take the hardware workforce, freelancers, and
IT professionals into account, the total number rises to more
than 1.3 million. With over half a million active freelancers,
Bangladesh is currently the second-largest supplier of online
labor in the world. This number can be further broken down
between employment by companies registered under BASIS,
BACCO, and e-Cab.
Why BPO?
To understand why BPO
became successful, it is
important to first understand
why BPO became a viable
option for companies in the
first place. Outsourcing
non-core functions enable
companies to allocate their
time and resources to core
functions that result in
higher impact for them. At
the same time, the countries
that mostly outsource their
processes operate in high tax rate areas, making their labor
very expensive and driving up costs. This is one of the key
reasons why firms prefer to opt for offshore services so that
they have access to more affordable labor forces, creating
positives for their bottom lines while creating a mutually
beneficial scenario for all the parties involved in this
transaction. While cheap labor is one of the greatest causes for
BPO, other considerations like access to innovation,
technology, flexibility, and agility also play important roles in
its success.
Cause for Success
BPO companies in Bangladesh have done well in many areas:
data entry, customer service, and information analysis, to
name a few. Right now, the most prominent figures in the
outsourcing industry are hopeful about moving toward more
complex areas, such as Big Data, AI, Machine Learning, and
IoT – because, after all, the bigger the challenges, the greater
the rewards to be reaped. This move, however, requires a
massive development in the skillsets of the human resources
involved, as well as certain infrastructural investments and
developments that are not yet within everyone’s reach.
Even though BPO includes many services, a
vast majority of them have probably emerged
from IT products and services. In 2019, the
Honourable Prime Minister’s ICT Advisor,
Sajeeb Wazed Joy, spoke at a BPO summit
about how it is a crucial element of the
Digital Bangladesh movement to create and
nurture new entrepreneurs and innovators,
with an eye upon the advancement of the
Fourth Industrial Revolution. So far, the BPO
sector has been majorly clustered in Dhaka,
but with ever-growing nationwide access to
the internet, even greater progress and
potential are being observed in the field, and
the government is undertaking new initiatives
to foster their growth. A number of hi-tech
parks have been established in districts
outside the capital to facilitate this. Mustafa
Jabbar, the Honourable Minister of Post and
Telecommunication, also stated that there are
plans to create 500,000 new jobs in the BPO
sector by 2024. The government is also taking
strides in supporting IT exporters through
subsidized resources and tax holidays, as well
as helping to ensure ease of business
wherever possible.
Other plans the Government has set in motion
pertain to forming alliances with IT industries
and educational institutions. It is quite evident that BPO will
become one of the key boosts for the nation’s economic growth
in the near future. The country has also seen a massive
improvement regarding access to fast internet and steady
electrical power. This required a great deal of active planning
to make business processes more consistent to compete on the
global level. For example, many steps have been taken by the
Government to ensure IT skill development, and internet
highway by way of the submarine cable link. The IT
connectivity has improved by linking the country to the global
infrastructure has massively improved as a result – something
essential for the expansion of the BPO industry. A total of
nearly BDT 35 billion has been invested in training skilled
resources since 2019. and more than BDT 150 million are to
be invested this year behind the same goals.
The rise of the gig economy has also helped the BPO sector.
Freelancing has become a popular choice of profession among
the youth, particularly in their mid-20s. The Oxford Internet
Institute states Bangladesh as one of the largest suppliers of
online labor, with the workforce focusing on many areas of
service from sales and marketing support to creative and
software development to clerical data entry and writing and
translation. Aside from that, one of the most common
business processes to get outsourced is call centers. Some of
the key players in the market are Digicon Technologies,
Graphic People, Kazi IT, Tiger IT, and Genex Infosys.
Aside from the agencies and companies, the youth fresh out of
universities and colleges are also earning substantial sums of
money working from their homes. The likes of Upwork,
Freelancer, Fiverr, and other such freelancing sites are full of
Bangladeshi youth and veterans alike, providing business
services of all kinds. From writing to SEO to app development,
the country’s got it all, and we have never been more ready to
take on the world’s problems and solve them.
Way Forward
Even with the progress made and being made all across the
country regarding internet infrastructure and training and
development, there is still a long way to go. One of the
common patterns observed when studying freelancers has
been their general lack of proficiency in speaking English
when dealing with international clients. The Government,
along with the BPO companies, should actively focus on
language development to stay on par with the competition,
which has made clear communication a priority for dealing
with clients.
Alongside communication, internet penetration should also be
ensured in rural areas and villages. Only then can the
educated youth residing in those areas join the sector and
become a part of the nation’s online workforce.
And last but certainly not the least, scopes of BPO must also
be increased from its current gamut of services to banking,
education, finance, and the likes.