Outsourcing&More - issue 2 (January-February 2012) by Pro Progressio

nr 1 (2)

January / February 2012 (bi-monthly magazine)

issn 2083-8867

Outsourcing annual summary of the year 2011 and industry forecast for 2012

 BPO – definition of the industry  Outsourcing in Tri-City and Pomerania Region

 Professionalization in the Call Center Industry

January / February 2012

Reklama Łódź is a good place for business. It is confirmed by the reports published by counselling companies and rating agencies, which place it at the top of the list of big cities as to their economic attractiveness.

The investors are attracted to Łódź due to its good location, availability of modern office space, competitive costs of running a business acti vity, highly qualified personnel and a large number of graduates of uni versities. Łódź also offers investment incentives for the companies, which would like to have a future in this City. It is worth to mention that the volume of public assistance in Łódź is higher than in other major cities in Poland and stays at the level of up to 70%. We got the trust of such companies as e.g. Fujitsu Technology Solutions, Accenture, Infosys BPO, DHL Express, SouthWestern BPO, ACS (a com pany of the Xerox group a global IT tycoon). The success of the City of Łódź as to attracting the investors from the BPO/IT industry includes the investments of two American companies: BMS (software and deve lopment of supervisory services and services increasing the efficiency of administering the liquidations) and Tate & Lyle (a global supplier of halfproduct food , with over 30 pro duction plants all over the world). In June 2011 a Centre of Research and Development of the Citi Handlowy Bank was opened, the third in the world after Dublin and Singapore and Nycomed company (a global pharmaceutical concern with its

offices in Zurich) opened its financial accounting centre here. The development of production com panies (Philips, GE Power Controls, Indesit, BSH), that invest in the servi ces and in Research & Development, is also worth emphasizing. When the results of the Global Investment Report were announced in July 2011 in Warsaw, the Polish Information and Foreign Investment Agency summarized half a year of foreign investment in Poland. Among six most important investments of the service sector in Poland listed by PIFIA two of them are residing in Łódź. The City increases its advantage by initiating another programmes en couraging the location and develop ment of the investment in modern services such as „Łódź centre of op portunities” and the project „Youth in Łódź Językowzięci”, whose objec tive is to promote learning foreign languages other than English, being in high demand by the investors. Currently, the City is implementing the project of the New Centre of Łódź, which is connected with deve loping 90 ha of area for commercial, artistic and cultural purposes.

The activities conducted by the City of Łódź as regards the promotion of the BPO sector development were appreciated by the experts from the industry. In June 2011, during VI Out sourcing Forum and II Conference of the Association of Business Service Leaders (ABSL) „Poland on the global map of the modern business services”, the City of Łódź received a prestigious award in the category of Excellent Partner, awarded to cities, institutions or organisations for intensive activities promoting the sector of modern business servi ces and active action for the benefit of attracting foreign investors from this sector and the cooperation with the investors already present on the Polish market. Recently, the potential of Łódź has been noticed by international media, which give Łódź as an example of the City, which „skilfully avoids” global recession and is investorfriendly. Łódź is a City of many opportunities, open to initiative and development, focused on modern industries and creativity.

www.centerofopportunities.lodz.pl

Editorial note Dear Readers, Free of charge magazine Editor-in-chief Dymitr Doktór d.doktor@outsourcingandmore.pl Art./DTP Jacek Cieśliński Main editor Radosław Wroński r.wronski@outsourcingandmore.pl Commercial reklama@outsourcingandmore.pl Published by RIPOSTA Doktór S.J. ul. Dolna 21b/40 00-773 Warszawa www.riposta.pl Editorial address RIPOSTA Doktór S.J. ul. Dolna 21b/40 00-773 Warszawa Tel.: +48 22 213 02 45 Fax: +48 22 213 02 49 redakcja@outsourcingandmore.pl www.outsourcingandmore.pl Print: Drukarnia Jantar Subscriptions: Outsourcing&More is bimonthly free of charge magazine. See the website www.outsourcingandmore.pl for more details All rights reserved. No copying, reproduction or photocopying allowed without written consent of the publisher. The views expressed in this publication as well as the content of the adverts are not necessarily those of the editor. Circulation: 3000 copies

I would like to wish everyone a happy New Year: lots of success, profitable transa ctions and reliable business partners. My wish is for the outsourcing branch in Poland to continue developing – this I wish myself, the O utsourcing&More and OutsourcingPortal.pl – so that this year and subsequent years may bring increasingly better results. Interest in the first issue confirmed how badly the market needed a periodical dedicated specially to the branch. The magazine targets foreign companies planning to invest in Poland, the owners of small and medium-sized companies active in the outsourcing sector, s tudents planning a career in the industry as well as the representatives of various local government offices and public administration bodies, who are becoming increasingly efficient at attracting and encouraging companies to invest in the region. Our readers sent us many letters and emails concerning the first issue. Some contained praise, others contained feedback, while still others contained suggestions concerning future issues. We have taken most of these sugge stions into account. Others will be incorporated in the future. As we want Outsourcing&More to provide exactly what readers expect, please send any suggestions or comments via email: redakcja@outsourcingandmore.pl The second issue revolves around BPO-related topics and contains a description of the industry, reports and experts’ standpoints. To start the year we recommend reading BPO in 2012, where representatives ofpublic institutions and the private sector share their opinions on the development of the BPO industry in 2011 and offer prognoses for 2012. I also highly recommend the interview with Jim Costello – a person with almost 20 years of experience in the industry, which is twice as long as outsourcing in Poland. The second issue also contains a description of yet another province. This time we focused on the Pomeranian Province. We also tired incorporating our readers’ suggestions to present each province in the form of a report and to include additional crucial information for investors; we believe that the present form will be met with your approval. I would also like to draw attention to the article on the Tricity area written by experts at P ricewaterhouseCoopers – a leading global professional services firm. We are very pleased that an organization of this rank has written an article for Outsourcing&More. I am also pleased to inform that Riposta – the publisher of O utsourcing&More and OutsourcingPortal.pl – was chosen as Media Partner for GigaCon in 2012. In closing I would like to invite all of our readers to the First Outsourcing Industry Tournament in squash and tennis, organized by the O utsourcing&More and the Okęcie Tennis Club. The tournament will take place in Warsaw on the 2nd of June 2012. Enjoy the magazine, Dymitr Doktór Chief Editor

January / February 2012

Index 13 Professionalization, Outsourcing & More

the Direction for Call Centers There should be no doubts that the Polish call center industry has entered the era of professionalization. The market is becoming more efficient at verifying the existence of ineffective organizations, as well as those that operate dishonestly and unethically.

40 Will the Tricity Join Poland vs Outsourcing

the A League of the Branch? Poland is home to over 280 modern services centers. These centers employ nearly 70 thousand specialists. According to opinions voiced by the press, the Polish A League cities of the sector – taking into account the number of centers and employees – are: Warsaw, Cracow, Wroclaw and Lodz.

49 BPO – Definition of the Education vs Outsourcing

Industry

„If there’s something we cannot do more efficiently, cheaper or better than our competition there is no point of doing it and instead we should hire someone who would do a better job than us.”

Who is who in outsourcing?

54 Interview with Jim Costello

CEO of SouthWestern BPS Ltd (Ireland) and CEO of SouthWestern BPS Poland Sp. z o.o. (Poland).

Join us on Facebook - www.facebook.com/outsourcingandmore 6

January / February 2012

8 News

Important Dates

Professionalization, the Direction for Call Centers

GigaCon Conferences and Events Planned for 2012

Purchases Can Lead to Savings

Riposta the Media Partner of the GigaCon Conferences

International Outsourcing Forum

Office Spaces

Tennis and Squash – Shared Roots, Different Symptoms

BPO in 2012

Human Capital of the Pomerania Region

Tricity’s Office Market Poised for Growth

Will the Tricity Join the A League of the Branch?

Strengths of Tricity

Comments to the CBRE Report

BPO – Definition of the Industry

Interview with Jim Costello

January / February 2012

Outsourcing & More | News

News Łódź best location for BPO and IT In early December 2011 the president of Łódź Hanna Zdanowska presented the Integrated Strategy for the Deve lopment of Łódź 2020+. BPO branch remains a priority for the City. Additional programs are initiated to encourage placing and development of investments Business Process Outsourcing or Shared Services Center such as “Łódź – Center of Opportunities” and student educational programs “Youth in Łódź”. City authorities focus on ongoing monitoring of investment process and proactive problem solving, as well as on presenting comprehensive offer of investments. Investors Relation Unit in City of Łódź has been providing a substantial assistance for emerging investors in the City for six years now. More companies decide to invest their Shared Service C enter in Łódź. The company Tate & Lyle, a supplier intermediate food products opened SSC for accounting, finance and IT this year. The CEO of Tate & Lyle Javed Ahmed said that their decision to invest in Łódź was based on excellent infra structure, availability of high quality office s pace and r elatively low operating costs. The key factor was the availability of highly skilled and experienced staff with good knowledge of foreign languages. On account of strong academic and scientific infrastructure and well-educated staff, the Research and Development Center of Citi Handlowy Bank in Łódź was founded this June with the purpose of creating modern banking products. This is the first, and hopefully not the last facility of this type that develops innovative banking solutions. In the Center, a team of experts, specialists in various disciplines of knowledge, programmers, research managers, business a nalytics and solution designers will be developing innovative solutions, which will be subsequently implemented in the bank institution. The most important is to identify and meet changing customer expectations. That Research and Develop ment Center will be cooperating with the Technical University of Łódź and the University of Łódź. The City of Łódź aims to undertake further actions to promote and create favorable conditions for the development of BPO and IT branches. Source: Investor Relations Office, City of Łódź

Tricity news The Gdansk branch of Intel has been given an award During the Christmas & New Year’s Eve gala, Polish Information and Foreign Investment Agency has rewarded the most important investment projects in 2011. The Gdansk branch of Intel, which is the largest R&D center in Europe, won the award in the category of new technologies. Currently, the Gdansk Intel office employs over 800 world-class engineers working on specialist software for silicon chips used to process computer graphics and s ignals. A project worth 1 million euro, which has been completed this year, is going to yield 60 additional workplaces. Such investments allow for the cooperation between Polish and foreign research teams to be extended. Intel’s success may be attributed to the skilled graduates of the Polish t echnology universities. Apart from that, Intel Technology Poland has won the award for the employer of the year second time in a row. Source: Invest in Pomerania

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French company SII raises employment by 100% In 2011, the Gdansk branch of Sii has expanded over twofold. In January, Sii employed 92 people in the Tricity. In the middle of November, the 200th engineer joined the team. Such a dynamic growth means that the company is among the top technology service providers and one of the largest employers in the Tricity.

_________________________________________________________ Significant raise in employment is mainly due to establishing cooperation with new clients and developing projects for long-standing Sii business partners. In 2011, the Tricity

January / February 2012

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team has acquired 8 new clients. The projects for bank and insurance sectors, as well as test centers, were the most thriving ones. The company has begun to operate abroad — there’s a demand for outsourcing and IT services among foreign branches of companies which are already Sii’s clients in Poland. „As of now, Sii is one of the leading technology service providers in the Tricity,” says Michael Desmurs, M anaging Director at Sii Gdansk. „We run projects for the largest companies, such as Gemalto or UTC Fire & Security. Our cooperation with the bank sector is thriving; we work for, among others, Nordea Bank, where we run projects related to e-banking, databases and CRM development. Our potential has been confirmed by the IT@BANK ranking published by ‚Miesięcznik Finansowy BANK,’ where Sii was ranked second in the ‚potential for development’ category. During the next four months, the Gdansk Sii team is going to have 240 people.”

CBRE opens its office in Gdansk and publishes a new report on the Tricity Given the growing interest of international companies in the Gdansk real estate market, CBRE has opened its new office there, which is headed by Mariusz Wisniewski, who has valuable experience in the Tricity property market and BPO. Mariusz specializes in investment consultancy as well as commercial real estate trading. He graduated from the International Relations Department at the University of Gdansk. „The opening of the office is the next step in CBRE operation on the Polish market and allows for extending the range of our services in the region. Currently, we experience a strong interest in the Tricity market, especially when it comes to outsourcing and offshoring. Many companies have chosen Gdansk to be their main office location for Central-Eastern Europe,” says Colin Waddell, Managing Director at CBRE in Poland.

Source: SII

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Source: CBRE

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LAUREATE has chosen Gdansk for their new SSC Laureate, the largest university in the world, having Bill Clinton himself as the chancellor, has officially launched its operation in Poland. On 12th December, the c ompany representatives officially opened their new consultancy center in the S TARTER Gdansk Business Incubator. OIE Support shall provide the base for the operation of Online Interactive Education, which is an international center for online education within a worldwide network of universities constituting Laureate International Universities. The center which has been opened in Gdansk is to recruit 130 people by the end of the year, and even up to 400 people later on. „Thank you all here for such a warm welcome,” said N orman Bloomberg at the opening ceremony of his company’s new office. „During the investment process in Gdansk, we had the assistance and care of many institutions and consultants, such as Invest in CBRE, HAYS or Invest in Pomerania. Our company operates on a global market. We embrace 50 universities in the USA, South America and E urope, as well as provide support to nearly 700 000 people all over the world. We specialize in selection of courses related to medical sciences, business and education. We’ve already completed the first stage of employee recruitment. We got offers from the Pomeranian postgraduates who know f oreign

January / February 2012

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languages perfectly and present world-class knowledge and skills.” As of now, 40 new employees found jobs. The recruitment of another 120 employees is in progress. „The workers employed at our new center in Gdansk will be responsible for contacts with our current and future students. They’ll act as consultants and make effort to meet the students’ expectations for educational and professional development,” said Bloomberg when describing the range of activities the new employees will be engaged in. „Our clients are people aged 35 to 45 who work actively and who want to supplement their education by obtaining an MA or PhD diploma. That’s why we need people with experience who may cooperate with our students at the most advanced level.” Source: Invest in Pomerania

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SALARIES IN THE TRICITY BPO/SSC CENTERS A commentary by Anna Brzezinska at Start People Sp. z o.o.: „Due to the available base of highly specialized experts and well-developed infrastructure, the Tricity cannot be ranked among the cheapest locations, but it’s not expensive either. Despite better infrastructure, remuneration levels are similar as in the case of, for example, Bydgoszcz, where transportation network is inferior. That’s why BPO/SSC companies see the Tricity as, so to say, a happy medium among other locations in Poland. Employees think similarly, because they know they’re being paid according to their skills, which in turn makes them loyal and increases the equality of their work.” The table below shows the salary levels.

Why Poland? The Polish Information and Foreign Investment Agency in collaboration with PwC published yet another edition of Why Poland – a guide for foreign investors. The publication is both informative and promotional. On the one hand it describes Poland as the ideal location for foreign investors, with focus on the country’s economic stability, well-educated personnel, strategic location and investment a ppeal. On the other hand the publication describes the Polish economy’s most significant sectors and outlines s ignificant data for companies operating, inter alia, in the following branches: motorization, BPO, aviation, IT, electronics and research and development. The publication was written in English and has a c irculation of 2 thousand copies. The online version of Why Poland is available under this link: http://www.paiz.gov.pl/publikacje/o_polsce. The publication was discussed on the 13th of December 2011 during a conference organized in the Polish Information and Foreign Investment Agency’s headquarters. Among those who participated in the conference were: I lona Antoniszyn-Klik, Vice Secretary of State at the Ministry of Economy, Takayasu Iwata, board member of Bridgestone, Professor Witold Orłowski, PwC’s Director Adam Żołnowsk and Tobiasz Adam Kowalczyk from Samsung Electronics Poland Manufacturing. The Agency’s president, Sławomir Majman, recapitulated all investment projects closed in 2011 by the Agency. The value of the 51 completed investments (1,135 million e uros) was 87% higher than in 2010; the number of d eclared employment positions (10,117) was 8% higher than last year. (PAIiIZ) Source: PAIiIZ

Table no. 1: Remuneration in the Tricity BPO/SSC sector — financial and accounting services. Job position

Gross remuneration (PLN)

Junior Positions

2 500 - 4 000

Middle Positions

3 200 - 4 500

Senior Positions

4 500 - 6 000

Team Leaders Positions

6 500 - 9 000

Manager

11 700 - 20 000

Source: Start People, 2011 r.

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Employer plans for 2012 The Polish Information and Foreign Investment Agency held a conference on the 5th of December 2011 which included a presentation of employer prognoses for the first half of 2012. Research methodology Respondents: the interview was conducted with p ersons directly responsible for personnel management and recruitment of new staff members. Research realization period: 3rd – 9th of November 2011. Method: CATI - Computer Assisted Telephone Interview. Number of companies participating in research: 300. Sample characteristics: companies representing the branch and region; companies hiring less than 10 employees were excluded from the analysis, as well as personnel consultancy companies and companies that do not use the services of temporary employment agencies. Statistical error margin for the sample N=300 was 5.64%. Summary Moods were not as optomistic. Fewer companies are predicting economic growth – in November of 2011 only 11% of surveyed companies gave positive assessments concerning the state of the economy (compared with 21% in July of 2011). More companies are talking about a recession (from 16% in July of 2011 to 28% in November of 2011). Along with the economic decline, fewer companies have raised employees’ wages within the last 6 months (from 31% to 25%), while significantly more companies have decided to lower wages (from 3% to 8%). Plans concerning employment are comparable to those voiced last quarter. Employers are most interested in hiring production personnel (19%). Employer demand for flexible forms of employment is maintained (FTE* indicator in the 3rd quarter of 2011 was 47 353 vs. 40 690 in the 2nd quarter of 2011). Every fifth company (22%) ensures its employees access to private healthcare. In a vast majority of surveyed companies (96%) permanent employees have access to healthcare, while in 49% of companies the healthcare plan also covers permanent employee’s family members. Most surveyed employers would prefer the employer to pay full tax for private healthcare services (34%), or at least participate in these costs (28%). Source: PAIiIZ

HP’s Global Business Center Will Be Directed by a Woman Agnieszka Orłowska has been promoted to Chief E xecutive Officer of the Hewlett-Packard Global Business Center in Wroclaw – one of HP’s strategic centers, located in E urope, the Near East and Africa. This is a new chapter in the 6-year history of HP’s GBC in Poland. Agnieszka Orłowska is to strengthen the center’s position not only in the region, but also in the world. This promotion gives evidence to the increasing significance of soft skills in management on the international scale. 15 years of experience in managing the operations of service centers, human resources, marketing departments, communication and budgets exceeding 25 million USD in HP’s business service centers worldwide are just some of the accomplishments of the new Chief Executive Officer of HP’s Global Business Center in Wroclaw. The center has been developing in Poland since the year 2005 and is one of Hewlett-Packard’s strategic centers in the EMEA region (Europe, the Middle East and Africa). Agnieszka Orłowska’s international promotion is a new chapter in the center’s operations. - We have built a strong position for the Wroclaw c enter in the EMEA region during recent years by taking on increasingly multidimensional and complex projects – states Agnieszka Orłowska, CEO of the HP GBC in Wroclaw. – Now

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we want to become the company’s strategic service center on the international scale, by expanding and developing key business processes for the entire HP organization – says Agnieszka Orłowska.

Today the Wroclaw center is among the 5 largest international outsourcing centers in the country; it hires over 2000 specialists and managers with higher education and foreign language skills.

HP’s GBC in Wroclaw is one of the company’s most advanced service centers in Europe. It mainly provides services in the field of financial and accounting, marketing and sales, s upply chain management, procurement and HR. The center has been successively taking on more a dvanced projects, requiring knowledge, the objective of which is the optimization of the cost structure and improvement of the company’s efficiency. Agnieszka Orłowska reports to Jack Levernes, the Vice President of HP Global Business Services in Europe, the Near East and Africa (EMEA), and board member.

Women are taking over the advanced business services industry

- HP’s GBC has been experiencing a dynamic increase in employment since the year 2005. We have been carrying out strategic projects which require high qualifications, good experience and – more and more often – team management skills, communication and building effective relationships with clients – states Jack Levernes. – The Polish center may soon become a key unit, handling Knowledge Process Outsourcing projects for the entire HP chain. The center has all necessary resources and skills to play this role – adds Jack Levernes.

Agnieszka Orłowska, as the CEO of HP’s GBC in Wroclaw is yet another woman to hold such a high position in one of the largest advanced business centers in Poland. The number of woman executives is slowly increasing. Among the largest companies in the industry 35% of executives are women. Many of them are experts in HR or communication.

January / February 2012

HP’s GBC in Wroclaw plays an increasingly significant role in the corporation’s international structure, due to, inter alia, a strategy of diversity, providing equal opportunities for men and women and persons from various cultural circles. 60% of the managers in the Polish center are women. HP has entrusted also entrusted to women its executive positions in the global structure. In September of 2011 Meg Whitman received the position of HP’s Managing Director.

Source: LinkLeaders

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Professionalization, the Direction for Call Centers year 2006, the elaboration of a norm which defined require ments for customer contact centers. It took three years for experts at the ECCCO (European Confederation of Contact Centre Organizations) and specialists at the CEN (Comité Européen de Normalization) to elaborate a document which was ratified towards the end of 2009 by 27 European Union Member States, as well as non-European members of the ECCCO; Russia, Serbia, Turkey and the Ukraine. The docu ment was indexed as EN 15838 and became a binding European s tandard with the status of a national norm. Work on regulating the standards of customer contact centers was commenced much earlier. Many European countries a ttempted to define guidelines as well as organi zational and operative norms for call centers as far back as during the early 2000s. Large discrepancies between the activities conducted in various countries lead to a lack of understanding. It was not until the project was taken over by the CEN that common viewpoints and unanimous standards and norms were announced for the entire E uropean Community. The EN 15838 norm is thus a distinctive compromise, undertaken to create an accepted and universal model, independent of local variations. What is a norm? The EN 15838 Norm is a formal document which describes the operational standards of so-called Customer Contact Centers. The norm pertains to call/contact center organizations, understood traditionally as over-the-phone customer service centers, but also to other s tructures in which c ustomer service processes are conducted via indirect contact. There should be no doubts that the Polish call center industry has entered the era of professionalization. The market is becoming more efficient at verifying the existence of ineffective organizations, as well as those that operate dishonestly and unethically. It is pleasing that organizations carrying out telemarketing processes have begun paying attention to customer needs and opinions, as customers are more familiar with their rights and have more clearly defined expectations. Problems (not only those from recent years) – including long waiting periods for phone c onnections, frequent redirections in order to take care of one manner, instrumental treatment of clients – have drawn the a ttention of the European Union Commission, which initiated, during the beginning of the

The norm was elaborated in order to define the operational standards of call/contact centers and create a b enchmark in the branch concerning service quality. The norm includes a set of good organizational and management p ractices, which guarantee high levels of customer satisfaction d uring center-customer contacts, and facilitate process o ptimization as well as higher efficiency. As soon as the CEN took over the elaboration of the norm, it became a general standard, available to all those interested – a collection of o bjective guidelines pertaining to the organi zation of manage ment processes. It thus answers the q uestion: “what are we standardizing?”, and outlines the fundamental answers to the questions: “to what extent?” and “in what way?”.

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Actions u ndertaken in four basic areas of call center organization are the path to obtaining d esirable results. The first of these areas is management policy and strategies which d efine and regulate undertaken processes. These take under consideration both the functioning of the organization as a business e nterprise as well as employee rights. The second area pertains to agents, the key employees of each customer contact center. The norm defines require ments pertaining to agents’ work organization, competences and development. The third area has been termed “infrastructure”, yet it pertains to elements beyond utilized specialized technology. It also encompasses aspects of the spatial organization of work, its ergonomics and utility in relation to the processes being carried out. The final key organizational area is comprised of processes encompassing all significant elements of the functioning of contact centers, from employee recruitment principles to contracting principles and center-ordering party cooperation guidelines during project realization.

The norm does not, however, define precise g uidelines on how the p rocesses should be organized in a given call center; correctly allowing for many paths of reaching defined objectives. The certification procedures comprise a method to be used when verifying the c ompliance of call/contact center management processes with the norm’s regulations. They are thus an objective algorithm of service quality and e fficiency assessment. Accordingly, they answer the question: Does the way in which processes are organized guarantee o btaining desirable results? The norm’s most important elements The norm’s essence has been depicted in the form of a diagram. The norm assumes a strict relationship between two fields: the organization of call/contact centers and effectiveness. The standard’s main message is to u ndertake purposeful organizational and operational p rocedures. Effects are visible, on the one hand, in the form of measurable customer satisfaction results, and on the other in the form of business and operational indicators. Analyses and constant monitoring of results should become the bases of reasoning and implementing improvements and innovations in assumed communication processes.

January / February 2012

The EN 15838 norm in Poland Since the implementation of certification processes in Poland, the norm has been generating the great interest of service centers. This is not surprising: we finally have a standard pertaining directly to contact/call centers. Due to the lack of widely available guidelines or regulations, the norm has b ecome a reference point, towards which more and more companies are eager to reach. In the first three quarters of 2011 we witnessed the first certification process. BZWBK S.A. and Polkomtel S.A. underwent verification. Both organizations successfully passed the certification process and received a certificate of c onformity with the EN 15838 norm. We should here turn our attention to the second aspect of the certification process. Along with the introduction of the norm came the need for organizations with a uthority to carry out the audit and verification of process compliance. There are currently two such o rganizations on the P olish market, which can conduct an audit and issue an EN 15838 c ertificate. The first of these is SGS Polska, part of a global c orporation s pecializing in certification p rocesses. SGS conducted an audit in March of 2011 and confirmed the compliance of p rocesses carried out by the Bank

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achodni WBK’s call Z center. The second organization is called A ustrian Standard Plus; this organization played an active role in creating the norm and elaborated the ECCCO certification guidelines, based on the aforementioned participation and support from the ECCCO. The Austrian organization is represented in Poland by the Polish Direct Marketing Association, responsible for the organization of audit and certification processes. In August of 2001 SMB/ AS+ conducted a conformity audit for Polkomtel S.A.; the company received a certificate of conformity. The Polish call/contact center market surely requires standards, and the EN 15838 norm fulfills both these requirements, and the trend of branch p rofessionalization. The new regulations have captured the interest of the market’s participants and information concerning them is the subject of discussion during almost all branch conferences. Currently the norm does not, however, have reference to the client market (parties ordering telemarketing projects) and consumers – the people who should be able to detect the actual effects of norm implementation by contact centers, and who were in a way the initiators of the changes we are experiencing today. I estimate that within a short period of time at least a dozen organizations carrying out call center processes will submit to certification of compliance with the EN 15838 norm. I foresee that – as in the case of previous

implementations – in-house call centers will be dominant among this group. I hope that these centers will become the driving force of the branch professionalization process, and establish clear requirements for their partners – mainly outsourcing call centers. This will bring many advantages to all business relations and market participants, including the ordering party and consumers. Professionalization requires many sacrifices and much experience. The EN 15838 norm seems to be a good product, written by the branch’s experts, and which foresees various paths of reaching measurable results. It draws attention to the purposefulness of each undertaken task, from elements of management strategy to operations involving client- company interactions. We should keep in mind that the objective of regulated implementation is continual improvement of undertakings to ensure the best possible market results. We are thus waiting for even better reports concerning the services provided by call centers, satisfied call center agents and satisfied customers. Author Maciej Buś Program Director in Akademia Telemarketingu

January / February 2012

Outsourcing & More | Articles

Purchases Can Lead to Savings Searching for savings in the procurement process is one of the strategies of optimizing a company’s operations, especially in the face of financial uncertainty on the European markets. In this case companies can decide to outsource processes, participate in group purchases or use the services of cooperative buying websites, which are becoming more and more popular among companies. The Everest Report (2011)1 indicates that the value of the rocurement outsourcing (PO) global market will reach a value p as high as $175 billion within the next few years. Procurement outsourcing is most popular in the United States, where over 45% of all contracts in this sector were signed, and in Europe, which accounts for 43% of all signed contracts. The increased interest in procurement outsourcing services is the result of the growing awareness of potential benefits gained by outsourcing these processes. Procurement outsourcing can be conducted on two levels. The first pertains to procurement centralization and unification. Savings are the result of lower prices, available due to the higher volume of orders. The second pertains to direct cooperation with a third-party service provider. Entrusting purchase processes to a specialized outside c ompany is linked with access to the know-how of experienced specialists, saved time and freed resources, which can be used to gain a competitive edge and to concentrate on the company’s core business. Group shopping is also becoming more popular. A s hopping group is formed when companies with similar o perational profiles join to form one entity, and order products or services as a group. The main advantage of c onglomerating to form these types of groups is the possibility to o btain price discounts without simultaneously foregoing an organization’s identity and independence. Companies gain access to verified s uppliers who cooperate with the group’s partners. In this case it is also possible to use the services of an outsourcing company. As stated by Wojciech Karpiński, the Chief Operations O fficer of Infosys BPO Poland, s pecialized suppliers who can cut costs even by a dozen percent annually have begun appearing on the market. Lately the interests of the B2B branch have turned towards individual group offers featured on cooperative buying websites. This solution is especially convenient for companies which want to avoid the risk linked with s igning long-term contracts. Currently over 802 such websites are o perating in Poland. Some websites are dedicated to corporate clients, while others target private individuals but are gradually expanding their offer to cover products and 1 2

The Everest 2011 Procurement Outsourcing Annual Report. Badanie serwisu Godealla.pl (2011).

January / February 2012

services for the B2B branch. An example is the Gruper. pl website. In October of this year the website introduced a special Your Company tab, which features offers for the business sector with discounts of up to 80%. The broader service portfolio introduced by Gruper is mainly a response to the needs of small and medium-sized companies. - Gruper is a source of various business offers which can optimize a company’s operations and facilitate the development of small and medium-sized companies explains Tomasz Dalach, co-founder and President of the Board at Gruper.pl. Even small savings generated during the procurement process can impact a company’s viability. This is why, as forecasted by Gruper’s representatives, group offers that target businesses are a potential area of development for cooperative buying websites in Poland. Source: LinkLeaders

Outsourcing & More | Articles

TRICITY 3rd – 5th October 2012 – POLAND Next Autumn will see Sopot play host to the 9th annual International Outsourcing Forum (IOF), organised by Arena Events International, London, together with a consortium of Tricity based IPA’s and governmental organisations. The IOF event has been staged at some of world’s key locations including London, Prague, Delhi, Andalucía and Dubai and the competing bids for IOF 2012 included Cape Town and Ljubljana. With IOF now in its 9th year, IOF 2012 promises to be the biggest and brightest in the events history attended by a host of names synonymous with the sector. The event comprises of many different and interesting a reas, 1-1 meetings; where executive buyers (pre selected and filtered by Arena) have the opportunity to speak face to face with suppliers (matched by Arena), workshops and master classes; given by notable companies and industry leaders and new for 2012, networking hubs including Real Estate, Investment, Knowledge and Innovation & Solution. In the evenings during the event period there will be dinners, concerts, cultural presentations and those wishing to stay up a little later will also be catered for by associated parties hosted by Sopot’s most vibrant nightspots. More information can be found at: www.arena-international.com/iof/ The 2012 International Outsourcing Forum will include some exciting changes including: International Outsourcing Forum (IOF Network) launch 2011: The IOF Network will provide an online platform for continued discussion and networking following on from the forum, stimulating discussion on key industry trends with access to information generated at the forum, industry news, white papers. This unique invitation only

executive network will create a hub of knowledge and networking for the industry. Industry Lead Advisory Board: Combining industry expertise to create a platform build by the industry for the industry, in a unique formula of industry associations, senior outsourcing executives, investment agencies, solution providers and consultants. Knowledge Driven Programme: The knowledge driven conference programme is designed around two themes, with a greater focus on interactive debate around the key issues and challenges affecting the growth, p erformance, innovations and strategies facing the outsourcing industry. Performance and Innovation Master-classes: Performance and innovation are at the fore of the industry, IOF 2012 will create more opportunities for suppliers to demonstrate the innovations and business models that deliver greater performance through the master-class sessions. Suppliers have an opportunity to increase awareness via sponsorship of the interactive master-classes.

January / February 2012

Outsourcing & More | Articles

Innovation and Solution Hub: Outsourcing executives must maintain a clear understanding of the continued innovation in technology and business models suppliers are developing, along with the opportunities they present, our IS Hub allows suppliers to exhibit and showcase their value propositions, increasing the opportunity to do business. Investment Hub: As the global economy develops, competition for international investment in existing and new locations increases, the understanding of the potential opportunities requires clear understanding of the capabilities of individual countries, the Investment Hub gives investment agencies a platform to present their potential. Knowledge Hub: Information is a key element in the industry, leading industry experts, consultants and suppliers have an opportunity to present bespoke industry reports and white papers through the knowledge hub, each report will be delivered to our network of executives and made available through the IOF Network.

January / February 2012

IOF Site Visits: IOF 2012 will include site visits showcasing the opportunities in Tricity; 1. Olivia Business Centre, Gdańsk – the largest b usiness park in Northern Poland; 2. Arkońska Business Park, Gdańsk – Director of First Data (case study); 3. Campus of University of Gdańsk – a presentation of educational offers Tricity; 4. Łużycka Office Park, Gdynia – Sony Pictures Entertainment; 5. Allcon Park, Gdańsk – Intel. Author Jake Jephcott, Director - International Development, Business Angel Seedfund sp. z o.o.

Outsourcing & More | Articles

Tennis and Squash – Shared Roots, Different Symptoms Tennis and squash may appear, at first glance, to be similar sport disciplines. Yet if we take a closer look it may seem that tennis is played in slow motion, when compared to squash. We should remember that both sports require a good physical condition and strength, as well as enthusiasm and familiarity with mathematics and physics. It is certain that tennis and squash share the same roots. Various games were invented during the last century, involving hitting a ball or a round object with fists, a bat, w ooden stick or racket. In the 1250s the French invented a game called “Le Paume”, based on games played by European monks during religious ceremonies. The term can be translated as “game played with the palms”, which with time developed into “Jeu de Paume”, very popular among the aristocracy. Rackets were first used to hit the ball in the 16th century, and this was when tennis was born. The game was also called King’s Tennis, as only rulers or the a ristocracy could afford tennis courts and other equipment necessary to play. S quash, the great-grandchild of the d iscipline was invented 300 years later, as a game for lower social classes. The game’s history began in a famous L ondon penitentiary nicknamed “The Fleet”, true to the saying that “necessity is the mother of invention”. The prisoners wanted to spend their free time – which they had excessive amounts of – in an active manner. They began rallying a ball back and forth – yet in a new way. These “criminals” could not play regular tennis, so they had the idea to hit a ball against a wall, instead of across a net. How did these “criminals” know the rules of tennis so well? The Fleet was a penitentiary for those who

did not pay their debts, as well as for “fallen” aristocrats. The game was relocated from the p rison to… elite schools for boys. In 1830 students discovered that the game is more interesting and increasingly difficult if the ball is punctured; it then slightly deflates when struck against a wall, and does not bounce as well as a regular tennis ball. This version of the game quickly became popular and the first squash courts appeared in 1864. Squash was then recognized as a distinct sport discipline. Yet the rules of squash were not e stablished until after the Second World War. Sets were originally played until a player received 15 points – many years later this n umber was reduced to 9, in order to shorten game time. First s quash championships took place in 1920 – naturally in Great Britain. Currently the standard is 11 point games, regardless if the points are won on the serve or the return serve. The contemporary version of tennis was also born in Great B ritain towards the end of the 19th century, called lawn t ennis. Tennis soon b ecame popular among the higher classes in English- speaking c ountries, and its popularity spread throughout the world. Tennis is an Olympic discipline p layed on all continents, by people of all ages. A tennis match c onsists of sets, and a set consists of games, while games consist of points. Most tennis matches are played until one of the players wins two or three sets, d epending on type of tournament or game (singles or doubles). A game consists of a series of points, with one player serving the ball. A game is won by the first player to have won at least four points in total and at least two points more than the opponent. The score is described in a manner peculiar to tennis: 15, 30 and 40. A set

January / February 2012

Outsourcing & More | Articles

is composed of a series of games. In order to win a player must have an advantage of at least two games: 6:4 or 7:5. If the score is tied 6:6 a tie-break game is played. Tennis is an exceptional sport, with many benefits; from health-related benefits to stimulating mental and e motional development. Tennis boosts the circulatory system, our physical strength, improves coordination, flexibility and motor skills and helps reduce body mass. Additionally, the sport requires strategic planning, which impacts intellectual development. Tennis is classified as a high-intensity sport. It helps players breathe more effectively and boosts blood circulation. Simply by running after the ball the player dynamically shifts his or her body’s position, which helps stretch muscles, maintain correct posture and improve reflexes and dynamics. Taking under consideration the average effort put into a tennis match and average game length, it is assumed that players burn between 400 and 600 calories. Apart from physical a dvantages, the game also has a good effect on our psyche. We become more disciplined and organized. We improve our strategic thinking skills, the ability to foresee our opponent’s movements and serves, as well as our planning skills, thanks to which we become more open and socially oriented individuals. We can also meet interesting people. We learn to be patient – as mastering the game can often be difficult. Players should invest in a couple – or even a couple dozen – games with an experienced trainer in order to learn how to efficiently hit the ball across the net. After such a description we can wonder if there is anything more pleasant and efficient than a game of tennis. As it turns out, some people would say yes. If we add to the description a wall and a ball that barely bounces we receive another sport: squash. The game is exceedingly dynamic, technical, requires strength, a strategic approach as well as knowledge concerning spatial geometry. The sport requires constant movement and guarantees physical and emotional expenditures. After just a few minutes of squash the pulse increases to 160–180 heartbeats a minute (which can be dangerous for those suffering from high blood pressure). Additionally, the game increases the body’s temperature; as a result, players sweat more; up to 2 liters of water during one hour of squash!!! The sport ideally tones and shapes our body, which is why it is often chosen by w omen, as an a lternative to fitness training. Just like in the case of tennis, a game of squash is beneficial to our p syche, in addition to b eing advantageous to our body. We develop self- discipline and organization skills, strategic thinking, the ability to predict our opponent’s movements and serves, and become more open and pro-social individuals. It is often said that squash is a game for gentlemen, as – unlike tennis – it is a contact sport.

January / February 2012

We must know when and how to end the game in o rder to reduce risk of injury to our opponent. Thanks to these characteristics, squash fully relaxes the mind and body, can “de-stress” and clear our thoughts. It is the perfect solution after a tough day at the office. This is why squash is mainly played by company CEOs, directors and managers: those who are prone to the highest levels of stress due to their professional responsibilities. Squash is also great before or during work, in order to clear the mind and “reload batteries” before yet another “battle in the business jungle”. Unlike tennis, we can master squash to a satisfactory level after just a few lessons with a trainer or a friend who plays at the intermediate level. As mentioned before, squash is a much more dynamic game than tennis and this is why a single hour of squash can help burn over 1 000 calories!!! In c omparison, couples burn a pproximately 600 calories d uring sex. Squash also helps reset our psyche and reload our batteries. Forbes magazine rated squash as the number one healthiest sport of 2011!!! It has been s cientifically proven that a game of squash – just like chocolate – releases endorphins, the s o-called hormone of happiness, which makes us feel content and in an excellent mood. A game of squash requires large a mounts of energy; it might make us feel tired, but at the same time gives joy and is addicting. References: www.historyoftennis.net, www.squashplayer.co.uk, www.wieszjak.pl, www.pzt.pl, www.pfs.com.pl

Source:

Okęcie Tennis Club

Outsourcing & More | Important Dates

14.02.2012 London

Organizer: SSON

Finance Transformation Europe

Location: The Bloomsbury Hotel 16-22 Great Russell Street WC1B 3NN London ( United Kingdom) Contact: enquire@iqpc.co.uk

07.03.2012 Orlando

14.03.2012 Amsterdam

19.03.2012 Budapest

16th Annual Nort America Shared Services and Outsourcing Week

12th Annual 足European 足Shared Services & 足Outsourcing Week

Organizer: SSON Location: Hilton Orlando 6001 Destination Parkway 32819 Orlando ( United States) Contact: info@iqpc.com

Organizer: SSON Location: The RAI Europaplin NL 1078 GZ Amsterdam ( Neterlands) Kontakt: enquire@iqpc.co.uk

Organizer: SSON

SSON Eastern European Summit 2012

Location: Budapest ( Hungary ) Kontakt: enquire@iqpc.co.uk

January / February 2012

Outsourcing & More | Important Dates

GigaCon Conferences and Events Planned for 2012 January

July

Visual Monitoring GigaCon – January 19th (Warsaw)

EOIF GigaCon (Warsaw)

Electronic Flow of Information in the Company GigaCon – January 25th,

IT Career Expo (Poznan)

2012 (Cracow) IT Career Expo – January 28th (Warsaw)

Media Career Expo (Cracow) Management Career Expo (Warsaw)

IT in Administration GigaCon – January 30th (Warsaw) Corporate Systems GigaCon – January 30th (Wroclaw)

August

Data Center & Storage GigaCon – January 31st (Warsaw)

IT Career Expo (Szczecin) Engineering Career Expo (Cracow)

February

Financial Career Expo (Warsaw)

E-business GigaCon – Companies Online – February 14th (Warsaw) Cloud Computing GigaCon – February 21st (Wroclaw)

September

IT in Insurance GigaCon – February 28th (Warsaw)

ERP GigaCon – September 12th (Warsaw)

Internet Safety Congress – February 29th (Warsaw)

IT in Healthcare GigaCon – September 20th (Warsaw)

IT Career Expo (Cracow)

BPM GigaCon (Warsaw)

Financial Career Expo (Cracow)

IT Career Expo (Warsaw)

Sales Rep Career Expo (Warsaw)

HR Career Expo (Cracow) Sales Rep Career Expo (Cracow)

March IT in Healthcare GigaCon – March 21st (Wroclaw)

October

Mass Payments GigaCon – March 14th (Warsaw)

Cloud Computing GigaCon – October 16th (Cracow)

Electronic Flow of Information in the Company GigaCon (Lodz)

IT at Higher Education Facilities GigaCon – October 25th (Wroclaw)

IT Career Expo (Lodz)

Electronic Flow of Information in the Company GigaCon – October 30th

Engineering Career Expo (Warsaw) Media Career Expo (Warsaw)

(Wroclaw) IT Career Expo (Cracow) Career Expo in Przemyśl

April

Management Career Expo (Warsaw)

ERP GigaCon – April 18th (Wroclaw) IT in Higher Education Facilities GigaCon – April 19th (Warsaw)

November

Virtu GigaCon – April 25th (Warsaw)

Call Center GigaCon – November 14th (Warsaw)

IT Career Expo (Wroclaw)

IT in Logistics GigaCon – November 29th (Warsaw)

Financial Career Expo (Wroclaw)

Navigation and Location Systems GigaCon

Management Career Expo (Warsaw)

IT Career Expo (Lodz) Engineering Career Expo (Gdansk)

May

Financial Career Expo (Gdansk)

CRM GigaCon – May 15th (Warsaw) Cloud Computing GigaCon – May 22nd (Warsaw)

December

IT in Banking GigaCon – May 28th (Warsaw

Corporate Systems GigaCon – December 10th (Warsaw)

Network GigaCon – May 29th (Warsaw)

Business Intelligence GigaCon – December 6th (Warsaw)

EOIF GigaCon (Poznan)

IT Career Expo (Wroclaw)

IT Career Expo (Gdansk)

Media Career Expo (Gdansk)

HR Career Expo (Warsaw)

Sales Rep Career Expo (Poznan)

Engineering Career Expo (Katowice)

June Financial Career Expo (Poznan) Sales Rep Career Expo (Wroclaw)

January / February 2012

Outsourcing & More | Industry Events

Riposta the Media Partner of the GigaCon Conferences usiness relationships and familiarity with newest industry b trends is not only helpful: it is necessary for the development of knowledge concerning the market’s offer – both in the field of management theory and practice.

SW Konferencje, the organizer of numerous conferences dedicated to outsourcing, HR, IT, finances, the economy and call centers, signed – in the closing days of 2011 – a Partnership Agreement with RIPOSTA, an Integrated Marketing Agency as well as owner and administrator of www.outsourcingportal.pl and www.outsourcingportal.eu, and the publisher of a Polish and English language periodical - Outsourcing&More (www.outsourcingandmore.pl). In accordance with the new agreement OutsourcingPortal.pl and Outsourcing&More will provide media partnership for all GigaCon conferences in 2012. GigaCon conferences are organized in various Polish cities and focus on many themes relevant to the industry. Participation is free of charge, and the subject matter revolves around current issues. Conferences provide a wide range of theoretical information as well as many practical solutions, which are presented during presentations as well as outside the conference hall, by the industry’s representatives and experts.

“OutsourcingPortal.pl has been an active partner during several GigaCons in 2011. Seeing their input in industry development and outsourcing issues, after a meeting with GigaCon organizers, we decided to develop and strengthen our cooperation” – said Katarzyna Doktór, Editor in Chief of www.OutsourcingPortal.pl. “Our strategy is to spread information concerning the outsourcing branch as broadly as possible, which is why our Partnership Agreement also includes our Polish and English language periodical Outsourcing&More” – adds Radosław Wroński, Managing Editor of Outsourcing&More. “We want information about good outsourcing practices to reach as many people as possible. We want to show people what outsourcing is, where it is present as well as who is providing these services in Poland”. SW Konferencje has planned over 60 conferences in 2012. Conferences will take place in Warsaw, Cracow, Wroclaw, Gdansk, Poznan, Lodz and Katowice. Several c onferences – concerning diverse topics – are planned for each month, including the Electronic Information Flow GigaCon on the 25th of January 2012 in Cracow, the IT Career Expo on the 28th of January in Warsaw, as well as the Systems for Companies GigaCon on the 30th of January 2012 in Wroclaw. We invite you to participate in our conferences, where we will have the opportunity to meet and talk about outsourcing.

Authors RIPOSTA i SW Konferencje

The Polish outsourcing industry’s conference calendar now includes permanent positions, such as the Call Center GigaCon, EPR GigaCon, Career Expos and the E lectronic Information Flow GigaCon. Most conferences are all-day events, held in perfectly organized conference halls. Lectu rers are well-known and experienced outsourcing experts. The combination of informative lectures with potential

January / February 2012

Outsourcing & More | Office Spaces

Business Garden Warszawa Business Garden Warsaw is a project under construction at the junction of Żwirki i Wigury Street and 1-go Sierpnia Street in Warsaw. Its first two buildings constitute phase one of the Business Garden Warsaw complex comprising seven buildings to deliver 90,000 sq.m of leasable space. The first building will house a business hotel, a restaurant, a cafe, a conference centre and offices while the other will offer office space, as well as a fitness club and service space on the ground floor. Both buildings are being developed using state-ofthe-art design and technical solutions which meet the requirements of ecology and environmentally sustainable construction. This will allow the project to be LEED certified. Business Garden Warsaw is the first of the three “green” business parks under the Business Garden brand. The other two will be located in Poznań and Wrocław. The first buildings in Poznań are scheduled to be delivered in 2013 while Wrocław will see its new Business Garden buildings come on stream in 2014.

Business Garden Warszawa Róg ulic Żwirki i Wigury i 1 Sierpnia www.cwoffice.pl

Cushman & Wakefield Plac Piłsudskiego 1 00-078 Warszawa Tel: + 48 22 820 20 20

Green Horizon To be the first, to be the best, to reach beyond the horizon – these are the goals you set for yourself and your company. In order to accomplish that you need people and they need an environment in which they can achieve their full potential. And that is why we have constructed Green Horizon – a perfect place for your business in the very centre of Łodz. Our office space is environment friendly, energy-efficient, modern and will enable your business to prosper. Green Horizon – just as all other p rojects of the Skanska Group – will obtain the prestigious LEED and GreenBuilding certificates, awarded only to the greenest buildings. The building is situated next to the Solidarnosci Roundabout – one of the City’s main communication hubs – and thus offers excellent connection with the rest of Łodz. Your employees and clients will easily reach your office by car or with one of 8 bus Lines and 2 tram lines. This location is also attractive for its proximity to the city’s exit road leading to the motorway interchange and allows quick access to the railway station, University of Lodz, airport and the shopping center - Manufaktura. Green Horizon is offering approx. 31,300 m2 leasable area, 7 office floors, two-level underground car park for 394 cars, 17 fast lifts, parking space for bicycles, with a changing rooms and shower for cyclists.

January / February 2012

GREEN HORIZON ul. Pomorska 106, Łódź

Outsourcing & More | Office Spaces

Offices

Arkońska Business Park

Olivia Gate - Olivia Business Centre

Garnizon - Twin Wave

Torus Sp. z o.o. sp. k.

TPS Sp. z o.o.

zdjęcie

Space: 16 620 m2 Location: Gdańsk, ul. Arkońska 6 Contact: www.arkonska.pl

Grupa Inwestycyjna Hossa SA

zdjęcie

Space: 18 000 m2 Location: Gdańsk Oliwa, Al. Grunwaldzka 472 Contact: www.oliviacentre.pl

zdjęcie

Space: 11 800 m2 Location: Gdańsk, Al. Grunwaldzka Contact: www.hossa.gda.pl

Name

Space: Location: Contact:

Name

Investor

To publish real estate information contact us at: Space: Location: Contact:

reklama@outsourcingandmore.pl Space: Location: Contact:

Space: Location: Contact:

Name

Space: Location: Contact:

Investor

January / February 2012

Poland vs Outsourcing | Articles

BPO in 2012 Exclusively for Outsourcing&More Polish and International experts have provided their opinions and comments. The questions we have asked were: 1. How would you describe 2011 from the SSC/outsourcing industry perspective. 2. 2012 - is it going to be the same, more challenging or will recession have an effect on SSC/outsourcing. tional work and move up in the value chain to achieve both quality and control improvements. Focus within p roductivity and efficiency remains and is concentrating towards technical and system improvements. Nicklas Blomqvist Director

2012

Finance, PMI Service Center Europe

Outsourcing of both transactional and business value a dded activities will continue to intensify in 2012 and at the same time it will be more challenging for the SSCs/BPOs s ector. International corporations will focus to look into moving further up the value chain. In addition there will be higher orientation in the direction of Global Process Centers, which means that there is a tendency among SSCs/BPOs, not considered by PMI, toward moving out some basic transactional activities offshore, while the more complex processes will remain in Europe.

2011 Without any doubts the financial crisis has impacted the further growth of the SSC/outsourcing industry. At the same time we can observe that for many companies cost saving is no longer the only key decisive factor in running the SSC/ BPO strategy. Many international corporations recognize that it is reachable for SSCs/BPOs to go b eyond transac-

Piotr Rutkowski Partner SourceOne Advisory

2011 2011 was dominated by the economic crisis. During the first “wave” of the recession – in the years 2008 and 2009 – companies sought immediate savings by making simple cost reductions (e.g. by quickly renegotiating c ontracts) and by bringing larger projects to a halt. This savings potential ran dry quite quickly. During the last dozen or so months we could observe that companies are looking

January / February 2012

for savings by conducting deeper-reaching restructuring processes. O utsourcing became popular once again. New contracts were signed, more processes were undertaken to renegotiate existing contracts. Cloud computing appeared on Poland’s horizon. Our country has reestablished its position in the SSC/BPO branch, practically joining the first league on the global scale.

2012 The largest change that will take place in 2012 will be the universalization of cloud computing. While it can be said that the year 2011 was a year of marketing, building customer awareness and creating an offer for the Polish market, the first contracts should take place in 2012. Perhaps the following year will also be interesting for the SSC/BPO branch. Much is being said e.g. about German companies transferring production and business service processes to the Far East or Central Europe. Perhaps the time has come for a second wave of investments?

Poland vs Outsourcing | Articles

2012

Mieszko Czarnecki Szczecin City Hall

2011 Integrating processes has become a sensible option for rationing a company’s costs. Whether or not this will lead to opening a shared services center or to outsourcing a ctivities is up to the company to decide. Lower costs are almost always the outcome. This is important especially in the case of companies, or even entire economies, which d epend on export. For developed European Union c ountries – Denmark, Great Britain, Holland or Sweden – which rely on export and are facing fiercer international competition as well as the ghost of the recession, which is encircling Europe as once had the ghost of the revolution – it is no longer enough to simply locate their production facilities in the Far East. Lowering costs is necessary. This is why the year 2011 has been another year of growth, although this is really just the beginning of the dynamic development of this industry. Outsourcing is a strategic solution – more and more companies are beginning to understand this.

I predict a much greater interest in SSC and BPO s olutions in d eveloped countries. International companies are a lready aware of the benefits – currently it is time for SMEs and local leaders to acquire this awareness. Poland is the natural location for the DACH market (Germany, Austria and Switzerland) as well as the Nordic countries. On the other hand in the year to come I will be awaiting the moment that a brave decision is reached by the public administration. Although limited abstinence from p ersonnel reductions and from outsourcing existing processes is understandable in the case of this sector, the new tasks faced by local governments are an opportunity to attempt to “throw outside” new processes. This will certainly not pertain to currently employed staff members, but could perhaps be an interesting solution to limiting the number of newly hired administration workers. An interesting m oment could be the effective date of the new act on waste m anagement. Of c ourse the administration cannot d elegate issuing d ecisions, however delegating certain processes to outside companies could be: cheaper, more flexible (the Local Government Employee Act is much more rigorous than the Labor Code, and cannot be compared with the business relationship), and more efficient. Here the ball is in the suppliers’ court: step by step, argument by argument suppliers must prove to their future public clients that their offer is an appealing solution. I believe that the year 2012 will be groundbreaking.

becoming a core industry sector in the Polish market and we anticipate further growth. Poland seems able to cope well with the language demands of the centres with many employees now relocating from neighbouring countries. Karolina Borucka Senior BPO/SSC Recruitment Consultant, Invidia HR

2011 In 2011 the market in Poland saw more than expected amounts of new centres opening in the market, whilst some of the existing centres grew their headcount by percentages also perhaps not anticipated. This business sector is now

2012 In 2012 the lowering of costs in the more expensive countries of the Western Hemisphere may still drive some new centres to Poland, however we are starting to see an evening out of salaries particularly at the management level which will effectively make the cost savings limited and ultimately curb the growth of this sector. Poland’s resilience to the economic crisis has perhaps not curbed salary growth as much as in other countries which centres are considering.

January / February 2012

Poland vs Outsourcing | Articles

Activities undertaken to promote o utsourcing also lead to results. Greater knowledge and awareness of the benefits stemming from cooperation with a third-party supplier have led to more requests for proposals.

Marcin Pankau Board Director of Holicon

2011 The year 2011 was a time of intense development for the Polish outsourcing market. Many corporations felt g reater pressure to limit their operative budgets. Companies cut costs on a large scale, while simultaneously fierce c ompetition for clients caused executives to search for ways of improving the quality of services and many c ompanies decided to obtain help from outside professionals. On the other hand companies which outsourced services with success during the conjuncture often d ecided to extend their contracts.

2012 Competition in the business services sector is becoming fierce. Data provided by PwC indicate that 74% of global outsourcers are planning to expand their service portfolio, and the business strategies of 13% of companies a ssume the acquisition of an outside entity. Similar tendencies can be observed on the Polish market. Within the next few years we will be witnessing spectacular fusions and acquisitions. It is assumed that the market will soon be dominated by a few of the strongest players, carrying out projects on the Polish and (as is becoming more and more common) international market as well as by a series of small c ompanies s pecializing in a narrow field; strong, but without a chance of joining the first league.

rates remain a cceptable. Cooperation thrives as centres get integrated by ASPIRE – the first Polish association of centres. Jarosław Pięta Partner Advisory Group TEST Human Resources

2011 In 2011 Krakow strengthened its position among the SSC/ BPO world leaders (ranking by Tholons). The c entres’ headcount was above 20 thousand (over ¼ of sector employment in Poland). Processes are expanding – in addition to accounting and IT, migration of finance, R&D, HR and purchase is underway. The ecosystem is a v alue added – centres, universities, specialised HR and IT s upport companies, and real estate processing, form a unique cluster, unrivalled in CEE. Surpassed critical mass d rives the expansion of existing centres, influx of new ones, and candidates’ development. Salaries and turnover

January / February 2012

2012 Kraków strengthens its position as migrated processes get more advanced. After years of the sector’s development, the market is providing qualified candidates, from CEOs, through management staff, to specialists. Each year the market is fed by 30 000 graduates. Thus every investor can find candidates on a suitable level and within the e xpected budget. It is this balance that distinguishes Kraków from other cities and accounts for its uniqueness. 2012 will see a continued influx of SSC/BPOs, and the e conomic slowdown may just slacken the pace of the process, as it did in 2009. Migrated processes will be of higher value added. Professional recruitment and retaining talented people will be a challenge.

Poland vs Outsourcing | Articles

a range of functions to support shared learning across centres.

2012 Andrew Hallam General Secretary and Board Member, ASPIRE

2011

The crisis of 2008 had two effects - short term there was a slow down which relieved some of the pressure on the market from the rapid growth of the previous 2-3 years; over the medium term growth has accelerated as a response to difficult times.

This time last year, Kraków was named the top emerging city for global outsourcing and the last 12 months have not disappointed. We have witnessed 25% growth in headcount over the course of the year, a further 6 000 new jobs created, bringing the total to 24 000 now employed in the sector in the city. This growth is a mix of existing centres expanding and new entrants. We also see a definite trend towards higher value services.

This time around there is not the same pressure in the market. Kraków has obtained a critical mass, which means there is an ecosystem to support the continued growth of the industry.

As far as ASPIRE is concerned, we have seen our membership rise to over 80 companies, which means we have more than doubled in size. We ran our first a nnual conference in May and during the year we established the ASPIRE Academy to support our members training and development needs, as well as expert groups across

From an ASPIRE perspective, we consider extending the model we have developed to other cities. This model focuses on the local environment for shared services and outsourcing, presenting the opportunity that the sector affords and promoting shared learning among companies. 2012 promises to be a very interesting year.

The question we are asking now is how big can we grow. This is the theme of our second annual conference in April, where we are expecting over 400 people.

With its strategic advice capacity and knowledge of the Polish market, ASPIRE certainly is playing a key role in the industry in Poland. Piotr Dziwok General Manager, Shell Business Service Centre Country Manager, Shell Polska

2011 It’s been a very good year from the industry perspective. We’ve seen a continuing development of SSC/outsourcing and offshoring centers across the globe, including Central & Eastern Europe. Apart from seeing a rise in the number of people they employ, we’re witnessing a growing maturity level of offshore organizations resulting in higher value of services for onshore businesses. This means an improved quality of offered services as they become more complex, providing more sophisticated services and leading process improvements based.

2012 According to the 2012 forecasts, all signs are pointing to another good year for the industry and it’s associates. This trend will continue to build business of a ssociated companies which will grow and continue to improve excellence together with the industry – I also see e nsuing improvement here, particularly in areas of quality and professionalism. Krakow, with its geographical location, effective infra structure will continue to be recognized as one of the key locations in Poland. Further, 2011 new comers will consolidate their position in the area. I hope that 2012 will a year of good cooperation with Universities in Kraków and Małopolska to ensure that the industry players’ ambitions are supported by new talented people joining the industry.

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Janusz Dziurzyński Vice President of ABSL,

2012

Director of the Procter & Gamble Global Business Services Center in Warsaw

Next year the competitiveness levels of specific centers will be judged based on their innovativeness and flexibility. In order to remain one step ahead of the competition, a service organization’s business strategies must pave the way for consequent advancement, systematically broader fields of expertise and improved terms of cooperation. New and innovative technology as well as processes which increase the effectiveness of the entire organization will gain in significance. Business Intelligence solutions will b ecome especially important. In the perspective of the years to come we will observe a dynamic development of reality visualization systems, which will not only describe and interpret the world they encounter, but also predict what will take place in subsequent months or even years.

2011 Last year Poland strengthened its position as a strategic region which provides advanced services of the highest levels of innovation. Polish service centers have continued their growth by adding to their portfolio highly-specialized services based on knowledge, linked with, inter alia, data analysis or support for business decisions in all areas of expertise. This trend also exemplifies the increasing complexity of services. The dynamic and consequent

Marek Rosiński Principal heading the TMT Group in the Warsaw office of Baker & McKenzie, Member of the Board in the Outsourcing Institute Foundation.

2011 The main trend for 2011 was the discontinuous growth of Shared Service Center1 investments. Poland has created for itself a good reputation in this field. Not only have new service centers appeared, but the scope of activities of existing centers has also become broader. This best p roves that these centers operate very well. The rapid development observed in the second half of 2011 was mainly facilitated by assistance measures. We could observe how very efficient these measures are. From November 2010 to July 2011 no EU funding was available, and government grants were suspended. In the second half of 2011 very many 1 Shared Services Centers – responsible for handling the global functions of a corporation from one, selected location, without entrusting these services to a third-party supplier.

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volution of the Polish services sector has not gone e unnoticed. Poland is currently considered a mature destination for offshore investments: as one of 5 countries in the world and the only country in Europe.

SSC p rojects were commenced. The largest IT outsourcing transactions for the financial sector have already taken place in past years, so the extremely overdue and not fully satisfying amendment of the banking law, which liberated outsourcing regulations for this sector, although positive, did not affect the market. Another event worthy of attention is the large, also on the European scale, outsourcing transaction for the TP network, which was suspended during the final p reliminary stage.

2012 Uncertainty on the markets works in favor of outsourcing as a solution which increases effectiveness and lowers costs. According to research conducted by the O utsourcing Institute in 2011, the Polish BPO market is currently worth nearly 4 billion PLN, and over 60% of companies e stimate that the upwards trend, visible throughout the year, will be maintained. Consolidation will be the next step in the development of this market. Debuts on the stock exchange are not out of the question. Polish suppliers have e xperienced personnel and can, with time, become fierce competition for the largest global players in the a rena. B uilding an international position is one of the greatest c hallenges for Polish suppliers, which will significantly impact their position on the market within 3 or 5 years.

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projecting a confident image of the region which is open to BPO/SSC investments. Mariusz Wiśniewski Senior Property Negotiator, Head of Gdansk CBRE Branch Office CBRE Poland

2011 As far as Tricity is concerned, this was a crucial year which managed to break the unlucky streak of the crisis-stricken 2009, when the only direct SSC investment was the financial center of Sony Pictures. The decision of our client, Laureate, to invest here, has ended 2011 on a p ositive note and proven that Tricity heads in a good direction. G rowing supply of space on the office market, well- organized and well-prepared (in cooperation with PWC) system of assistance rendered by local government bodies, as well the opening of our office in Tricity – all this contributes to

2012 The spreading wave of recession in Europe and the USA favors/leads to a more strict expense control, which is always beneficial for this particular industry. In my opinion, we will experience the strongest growth in IT services, especially with regard to mobile software and internet marketing. D espite the visible impact of crisis, which may reach its peak next year, I think we won’t see another 2009, when many new investment projects were halted. The number of takeovers and mergers of outsourcing companies will also increase, in particular in IT and banking sectors. On the other hand, given the feeling of uncertainty on the fi nancial markets, long-term contracts are not to be expected. In the case of Poland, the industry may benefit from the depreciation of the Polish zloty in relation to the euro, which may lead to a slight decrease in workforce costs and account for a high position of Poland in this year’s investment attractiveness rankings.

outsourced operations when they’re located in the same/ close to the same time zone as their home country (due to short flights, no/very slight time difference, cultural proximity of staff etc). Viktor Bogdanov General Menager IT Sourcing Europe

2011 Judging from the perspective of IT/software development outsourcing, 2011 is the year of small contracts (up to €50K), emerging megatrends such as, for instance, multi sourcing and nearshoring and innovative engagement models. This year we see an increased demand for ITO services from SMEs and high-tech startups that outsource primarily for cost reduction and time-to-market acceleration purposes. Industry-wise, there’s an increased demand for ITO services from both the traditional sectors (e.g. s oftware/ web development, IT, telecom, finance) and innovative lucrative n iches such as digital media, gaming and mobile development. Regarding the ITO geography, Europe is turning away from offshoring and focusing more on nearshoring. There’re actually several reasons behind this, but the key one is, to my mind, that many European ITO buyers strive to have as much control of their corporate IT/development projects as possible and, thus, have a better chance of managing their

Also, in 2011 European ITO buyers become more careful when selecting their ITO locales and partners. Companies remember well what a negative impact on the international business has been made by the recent uprise of political protests and armed rebellions in North Africa and the Middle East and are now much more concerned about the political and economic stability of the regions where they transfer their IT/development functions. When choosing their ITO service providers, the European companies care less about the availability of the quality and/or organizational process maturity certification, but care more about the companies’ realistic ability to scale up the project, transparent and clear pricing and experience in similar projects. Overall, ITO buyers become more involved in vendors’ IT talent selection and hiring processes, compared to the past years. In order to secure their outsourced operations and avoid force majeure situations related to the delayed p roject deliveries and/or unmet milestones and poor p roduct quality, more ITO buyers try to distribute their projects/ project elements to several different vendors (oftentimes the geographically dispersed ones). Another explanation of the multisourcing trend is that many small companies prefer to partner with small or mid-sized ITO service providers (which is another trend of 2011) and may not just be able to find

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enough required expertise/resources in a single provider. This leads them to look for appropriate expertise and resources available in different companies.

2012 In Europe, the overall IT spending is predicted to shrink in 2012. However, this may have some positive effects on the evolution of the IT outsourcing industry. I wouldn’t a nticipate the European ITO spending to increase much in 2012, as the general value of contracts becomes rather small, compared to the past years. Nevertheless, I b elieve it’ll remain the same as in 2011. Europe won’t be able to beat the United States in terms of ITO megadeals and b udgets, but is more than likely to develop its ITO m arket as per its own unique scenario: due to the ITO rapid penetration into the innovative niches and companies’ focus on n earshore development, the e ntire concept of outsourcing may change in 2012 and years to come. On the one hand, we see a significant s hortage of IT talent and resources within the EU, while on the other – a huge potential of Central and Eastern Europe to nurture and provide highly qualified IT specialists to fill in the current gap in Western Europe. So, I’d say 2012 will be the year of great opportunities in Europe, when Western European companies will source Central and Eastern E uropean resources and gain access

Krystian Bestry Managing Director of Infosys BPO Europe

2011 The market matured during this period, which is confirmed by Everest Group’s ranking. Poland was among the five most developed markets for offshoring investments in the world. We are part of this group along with India, which has been considered an outsourcing tycoon for years. This year we have exceeded a critical barrier, both in the case of the number of employees and the value of signed contracts.

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to the innovation and state-of-the-art technology thanks to cross-border cooperation. However, more than one year is needed for this change to happen. R egarding the challenges, I guess they’ll remain the same in 2012 as in 2011: delayed project deliveries, poor communication with vendor’s p roject management and executive teams and poor project management on vendor’s side. Besides multisourcing that is already being used as a response to delivery problems, ITO buyers will have to invest more in own outsourcing p roject management, engage with service providers via models allowing maximum project control and extension of in-house IT teams rather than their augmentation. I personally expect cloudsourcing to become the next big trend, but am not sure this will happen in 2012. More companies are likely to use cloud-enabled outsourcing next year (as there’s obvious increase in cloudsourcing transactions on a year-on-year basis), but, again, more time is needed for the current cloud issues (e.g., compliance, open source, security) to be fixed and, say, every second company to move to the cloud. Overall, I see 2012 as a year of slow yet steady maturity of outsourcing industry.

In addition, we have available office space which fulfills the highest corporate standards and is ready to facilitate new investors and employees, who – apart from being well- educated – are also becoming more experienced service center workers. Today nobody is testing Poland. Nobody is saying: “is it worth it to invest here?”. Most companies are asking themselves: “what else can I accomplish?”.

2012 The year 2012 will be record-breaking for the industry, especially if we take under consideration the profits generated by service centers. It is estimated that the value of services sold abroad will exceed 5 billion USD. Contracts will encompass increasingly complex services, requiring knowledge and a few years of experience, to which larger profit margins can be added. Western European countries will remain the main service recipients, and new contracts will be the result of nearshoring tendencies and process centralization procedures.

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Human Capital of the Pomerania Region most important educational centre in the region. Another important city is Słupsk with 4 educational institutions. The most important universities in Tricity are: Gdańsk Technical University, University of Gdańsk and Gdańsk Medical University. These institutions play a very important role in educating the society, the first two being also c rucial to the preparation of future employees for the SSC/BPO centres. The universities in Tricity attract students from the whole country and are especially popular among young people living in Northern Poland. In the Polish Ranking of Higher Education Institutions prepared by the Perspektywy Magazine these universities are situated within the top twenty, which indicates that the quality of education that they offer is significant. U niversities from Warsaw, Kraków or Wrocław are positioned only s lightly higher and Gdańsk ranks much better then most universities from the Silesia Region or from Lublin and Szczecin. In the era of constant advancement and complication of the global economy the service sector seems to be growing and expanding rapidly, thus creating an atmosphere in which the value and strength of a given market is measured by the quality of its human capital. The primary condition for the future development of any society are the competences it possesses and the extent to which they reflect the needs of the world market. Human capital is very quickly becoming the most important piece of the global economy puzzle. It is the basis for every decision concerning founding a new business or moving some functions to another part of the world. A potential for acquiring a high quality workforce is a key factor in discussion about outsourcing certain pro cesses to better locations. Human capital is one of the elements of intellectual capital. The other parts thereof are, according to the definition by Dorota Węziak-Białowolska PhD., social capital, develop mental capital and structural capital. The description of the Pomerania Region presented in this article is focused on the human capital; taking into consideration a survey conducted by Hays Poland on a group of experienced sector employees.

According to GUS, there were 107 000 students in the Pomerania Region in the year 2010. Only 10000 of them have been studying outside of Tricity, which confirms the importance of this agglomeration as the regional academic centre. The number of students in Tricity is steadily growing. Over the last 5 years this number has gone up by 12 per cent. This positive trend is very strong. There are 2000 additional students each year. It is also worth mentioning that there has been no deviation from this trend in the previous years. The number of graduates is growing even faster. Between 2005 and 2010 it increased by 37 per cent. Only in the year 2010, 20 000 young people in Gdańsk, Gdynia and Sopot entered the job market.

Chart 1. Graduates of specific studies in Tricity

Human capital: students and graduates Pomerania Region has a very broad educational offer. According to GUS, in 2010 there were 28 Higher Education Institutions located within its borders. Twenty one of them were located in Tricity, which makes the agglomeration the

Source: HAYS calculations based on Local Data Bank GUS

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of education is a direct effect of great academic programs within the regions schools and universities. At the University of Gdańsk, the most important language education centre in the region, there are 6 language specialisations: English, Russian, German, Scandinavian, Slavic and French. 700 students specialize in English, 500 in Russian and German and 200 in Scandinavian, Slavic and French respectively. The most popular foreign language among students in Tricity is English (90 per cent of students declared at least basic knowledge of this language), more than 40 per cent speak German; the remaining languages are also quite p opular (French and Russian – around 10%; Italian - 3%; S candinavian – 1,5%; other languages – 5%). It is certainly worth mentioning, that the population excels in the area of niche languages especially ones belonging to the S candinavian group. One of the most important elements taken into consideration when one plans to establish a BPO/SSC centre in a certain region is the quality of human capital available. The employer values practical knowledge and work experience most and one way of determining a potential of the candidate is by Chart 2. Knowledge of foreign languages among students in Tricity, n = 1800

Other important location factors for SSC/BPO investors are the number of IT, economics and technical & production studies graduates. According to GUS there were more than 600 IT graduates in Tricity in the year 2010. The number is one of the smallest among academic centres in Poland but Tricity is distinguished by a very high growth rate: over the last 5 years the number of graduates in this area has increased by 69%. This fact indicates a growing interest in this type of studies, which is a very positive trend. A ccording to GUS, more than 5 000 people graduated from the e conomics studies in 2010 and 1 400 students have e ntered the job market having graduated from technical studies. These numbers are also growing year by year. Another factor often taken under consideration by investors planning to establish a SSC/BPO centre is the k nowledge of foreign languages among potential employees. Tricity is abundant in well experienced potential employees with broad knowledge of foreign languages. The high quality

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Source: HAYS calculations based on data from Bilans Kapitału Ludzkiego – 2010

checking if he/she took active part in training programs, internships etc. Such practice is a common standard among students in Gdańsk: 57% of them declare participation, which is nearly as much as in the most important academic centre of Warsaw (60%). A good way of telling whether a certain area is abundant in specialist knowledge and skills is to check the number of students’ scientific clubs and organisations active within universities in a given region. These entities play a signi ficant role in educating young students and providing them with information not present in regular college curriculums. The number of students being members of various organi-

Poland vs Outsourcing | Report

sations amounts to as much as 20% which is a sufficient number, close to Polish average. All the estimations are based on data from the survey Bilans Kapitału Ludzkiego (BKL) conducted on a sample of 30 000 Polish students, among them 1800 from Tricity. As per the BKL survey above it is worth dedicating special a ttention to more concrete abilities and competences, which represent a more practical value to every e mployer. The potential human capital of Gdańsk can be characterized as business-minded and full of initiative; 23,5% ranked themselves as very competent in this area. Moreover s tudents in T ricity excel in skills such as a dvanced mathematical c alculation (18,3% declared very high level of competence, which is the best result in Poland). Such abilities are o bviously intertwined with others and it is no surprise, that the educated labor force is also competent in advanced computer use; they are in possession of high programming skills and able to create internet sites: 13,9% evaluate themselves as very good in this area and further 16,6% as good. The results indicate a great potential for development of SSC/BPO centers, especially in IT and financial analysis area. Human capital: experienced employees The SSC/BPO sector is dynamically expanding on the P olish market adding new, more advanced processes to their o ffer. From the investors point of view not only graduates create a great talent pool potential but most of all it consists of experienced and knowledgeable specialists.

Chart 3. Answers of the SSC/BPO employees in Tricity to a question: “Do you consider Tricity as a good place to live?”

Table 1. Selected SSC/BPO centres in Tricity Company name

Centre profile

Axciom

Arla Foods

F&A

GE Capital

Banking back office centre

Fineos

First Data

F&A

Geoban

Banking back office

Jeppesen by Boeing

Kainos

Laureate/Online Interactive CC Education Nordea

Banking back office

Sony Pictures

F&A, SAP

Thomson Reuters

Data Analysis & IT

Lufthansa Systems

Nevion

Source: HAYS Poland based on press monitoring

The size of the sector can be measured by two values. One of them is the number of SSC/BPO centres and the second is the number of people employed within these centres. The number of people employed in the SSC/BPO sector in Poland has grown by 50 per cent over the last 2 years. In the year 2010 in Tricity, according to ABSL, there were more than 20 centres, which employed more than 6700 people. In the year 2008 there were 4700 persons working for the service centres, which means that over those 2 years that number has grown by 43 per cent. This is quite a high rate when compared to other sectors, furthermore one must note that Tricity is still not a saturated market, with an enormous potential for growth. The most important service centres Chart 4. Declared knowledge of foreign languages among SSC/BPO employees in Tricity

Source: HAYS survey, n = 100

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in Tricity together with their profile are listed in table 1. The newest investments in Tricity include a financial & accounting centre by Sony Pictures and a centre by Laureate/Online Interactive Solutions, employees of which are responsible for recruiting and advising participants of courses offered by top international universities (online programs). The SSC/BPO sector in Tricity is quite young and still developing. Therefore the start-up centres very often attract the experienced workforce from more developed markets such as Warsaw and Kraków. This fact is reflected in the results of a survey conducted by Hays Poland among past and current employees of the SSC/BPO sector in Tricity in the end of November 2011. The average work experience among employees in Tricity is between 3 and 4 years, while, according to ABSL, the mean of the country is between 2 and 3 years. Also, only 54,2 per cent of respondents lived in Tricity before taking the current job. 16,7 per cent is commuting and almost 30 per cent relocated from a different city, e.g. Warsaw, Wrocław, or Poznań. The above results are in accordance with the experience of Hays Poland. When recruiting experienced employees to the newly established Sony Pictures SSC, Hays prepared an Employer Branding campaign in Poland and abroad. Our recruitment marketing was a notable success and attracted the attention of many people from various market areas. As a result, over 70% of specialists employed by the centre are from outside the Tricity area and Poland as well. The SSC/BPO employees perceive Tricity as a good place to live. More than 60 per cent of respondents answered “definitely yes” to the1 following question: “Do you consider 2012_01_CA_outsourcing&More.pdf 11/01/2012 14:32:30

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Tricity as a good place to live?”; 28 per cent a nswered “ rather yes”. There were only 12 per cent of negative responses and none of them was definite (“definitely no”). This data is p resented on the chart 3. More than 80 per cent of SSC/BPO employees in Tricity are economics graduates. All of them speak English and 54 per cent on the highest, fluent level. 64 per cent of them declared knowledge of German, which is higher than the average for Poland. Also the popularity of the Spanish language is worth mentioning: it is spoken by 29,2 per cent of respondents, which is also higher than the polish average. The popularity of other languages is presented on the chart 4. One of the most interesting aspects of the recent study con ducted by Hays are the employee expectations towards

Poland vs Outsourcing | Report

their workplace. The most valued aspect is undisputedly the international atmosphere and opportunity to cooperate with people of different cultures and customs. Over 50 per cent of respondents declared that the above aspect is the main reason for which they work in a given company. In the second place there is the financial aspect of work. Safe employment takes the third place. The above indicates that SSC/BPO centres are highly preferred on the labour marketthey operate globally. Another factor influencing the results might have been the recent turbulences on the global market and the looming crisis. In such circumstances people tend to v alue such aspects of employment as loyalty and stability. This has been perfectly reflected in the survey results. Conclusion In the modern age changes in the global economy are incredibly fast paced. The only way to keep up with them is by adapting to the newest trends and standards. This cannot be done without professional, highly specialized and well educated employees. Human capital consists of such elements as knowledge, education, practical abilities and the right psychological characteristics among the population of a given region. It is currently the most important aspect taken into consideration when one is in search of the right spot to invest in by establishing a BPO/SSC centre.

Institutions of higher education in Gdansk, Gdynia and S opot provide a yearly mean of 20000 graduates, out of which a quarter specialized in economy and 90 per cent declared good knowledge of English. Furthermore, there is a significant number of experienced SSC/BPO employees – more than 6700. Pomerania Region gives an exceptional development opportunity for SSC/BPO centres, especially those specialising in IT and financial process.

Hays Warszawa ul. Złota 59 00-120 Warszawa warsaw@hays.pl www.hays.pl

Chart 5. SSC/BPO employees’ expectations towards employers in Tricity

Source: HAYS survey, n = 100

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Tricity’s Office Market Poised for Growth The dynamic development of Poland’s office market begun in 2010 continued its momentum in the first half of 2011. The total office stock of the main regional markets (Kraków, Wrocław, Tricity, Katowice, Poznań and Łódź) now stands at nearly 2 million m2. Around 250 000 m2 of office space is under construction, an increase of 40% compared to the end of 2010. Wrocław, Kraków and Tricity accounted for the largest share in supply with 30%, 25% and 18% r espectively. There is also a stronger interest in smaller regional markets with Szczecin alone accounting for around 7% of office space under construction in Poland.

Around 70 000 m2 of office space is currently under construction, 80% of which is to be delivered by the end of the first half of 2012. The key projects include Olivia Point and Tower (TPS), Opera Office (Euro Styl), Garnizon.biz (Hossa) and BCB Business Park (Bałtyckie Centrum Biznesu). Modern office space provision (m2 per capita)

The limited supply and the continued interest from tenants in office space have resulted in falling vacancy rates in practically all the regional markets, with the highest recorded in Łódź and Katowice. The new supply pushed the vacancy rates up slightly only in Kraków and Wrocław. The shrinking volume of vacant space has led to a slight increase in effective rents. Tricity’s market Supply Tricity’s office space stock rose to 326 600 m2 with the delivery of Allcon Park II in the first half of 2011 and Olivia Gate in the fourth quarter of 2011.

Most of these buildings are in Gdańsk’s non-central locations. The highest concentration of office space is along the city’s main thoroughfare Grunwaldzka Avenue with good availability of plots for development and excellent public transport including the metropolitan railways, buses and trams. Thanks to new developments this post-industrial area is slowly becoming an office and service centre. More and more tenants tend to choose this location as it offers effective space at modern office buildings such as Arkońska Business Park and Olivia Business Center. Modern office space stock in H1 2011 (m2)

Tricity is the fourth most populated Polish city with 742 000 inhabitants. Its space provision per capita stands at 0.41 m2. The chart above shows the volume of office space per capita in all the regional markets. In Warsaw, being Poland’s most mature office market, this ratio amounts to 2.00 m2 per capita. This illustrates the huge potential of the Tricity market.

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Around 30 000 m2 of office space was leased in the first three quarters of 2011, with new deals accounting for around 77% of this volume. The largest transactions included the lease of space at Olivia Gate by Energa Group, at Arkońska Business Park by Jeppesen Poland, at Artus Park by Amber Gold and at Office Island by Wolters Kluwer. Vacancy rates In the past six months the vacancy rate fell by four percentage points to 10%. The successive delivery of space currently under construction is expected to push vacancy rates to 15- 20% next year. This space, however, is likely to be leased gradually given the continued demand level. Rental levels

Tricity’s office market was one of the most slowly developing regional markets in the years 2006-2010, but it is now seeing the highest supply growth rate in Poland. Apart from projects currently under construction totalling around 70 000 m2, building permits have been issued for developments such as a large business park Alchemia (Torus), Neptun (Hines), Granary Island (AVG) and Neptun House (Capital Park) to provide around 50 000 m2 in total, including only the first phase of Alchemia. At least 80% of this space is expected to be completed in 2013. Tricity’s office stock is likely to reach around 400 000 m2 by the end of 2012 and around 450 000 m2 in 2013, representing an increase of 38% on the current level within two years. Demand Dependence on external demand makes it difficult to estimate the total demand for office space in the future. D emand is largely generated by companies already operating in Tricity’s market as well as external BPO and SSC companies. Tenants are also likely to relocate from older office buildings to more modern locations offering space at similar or marginally higher rents. This will make the market vary more strongly, depending rather on the stock quality than the location. Typical leases in Tricity are made for 300-500 m2 by local companies and around 1 000-1 500 m2 in the case of large international companies. The larger deals of over 1 000 m2 are signed mainly by newcomers to the Tricity market, companies with existing shared services centres or by outsourcing companies.

Asking rents in Tricity stand at EUR 13-15/m2/month, but developers are already gradually reducing their rent expectations. In 2012, they are expected to average EUR 12- 14.50/m2/month, depending on the location and the number of competitive buildings in a given area. Asking rents are likely to reach EUR 12-13/m2/month in the area of G runwaldzka Avenue and Kołobrzeska Street and EUR 14- 15/m2/month in downtown Gdańsk, Gdynia and Sopot. Developers offer financial incentives which have already become standard market practice and include both rent free periods and cash contributions for non-standard fit-out as well as budgets for other tenants’ costs connected with o ffice organization or relocation. Effective rents will stand at EUR 11-13/m2/month. Market outlook The development of Tricity’s office market will be stimulated most strongly by the dynamic growth in the supply of modern and effective office buildings. This is likely to increase market competition and gradual diversification of the office market in terms of space quality. Tricity’s market, which is dominated by local developers, is projected to attract growing interest from large international investors in the forthcoming years. Hines, Capital Park, Echo Investment and AVG have a lready decided to enter this market and other major real estate players in Poland will certainly seriously consider launching new projects in Tricity.

Author Krzysztof Misiak Senior negotiator, Office department Cushman & Wakefield

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Will the Tricity Join the A League of the Branch?

The modern services branch in Poland Poland is home to over 280 modern services centers. These centers employ nearly 70 thousand specialists. According to opinions voiced by the press, the Polish A League cities of the sector – taking into account the number of centers and employees – are: Warsaw, Cracow, Wroclaw and Lodz. According to the forecasts of the Association of B usiness Service Leaders employment in the modern services s ector will soon reach 100 thousand, as approx. 30-50 new centers are being planned. Among cities aspiring to become leaders in this branch of the economy and play an active role in the race for the abovementioned investments are the Tricity (Gdansk, Gdynia, Sopot), Katowice (the Silesian agglomeration), Poznan and Szczecin. If we remove Warsaw from above A League, as the capital city is the largest and least competitive cost-wise, we can state that the remaining locations are comparable – c ost-wise and potential-wise. Yet what makes the Tricity stand out from the rest?

the region, along with the Information and Communications Technology (ICT) sector. Among other branches that o ffer good conditions for investors are: logistics, energetics, pharmacy and motorization. One of the benefits of the Pomeranian Province is the availability of financial and information technology s pecialists, including a management staff with experience in SSC/ BPO. Other benefits include good language skills, as well as market saturation in other Polish regions. In addition the continually developing airport infrastructure has improved the region’s global accessibility. These factors have not gone unnoticed by investors, including: Intel, Sony Pictures, First Data Global and Thomson Reuters, and their dynamic development confirms the good investment environment of the region. In the light of this information, does the Tricity have a chance to become as appealing for BPO/SSC investments as Cracow, the most recognized city in the branch? Factors which impact choice of location

The region’s potential In 2011 PwC conducted an analysis of the Pomeranian Province’s investment appeal. The analysis indicated that the SSC/BPO branches have the best development potential in

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When choosing a location for a future shared services center or BPO center, companies most often take under consideration factors such as the availability of staff m emers, including education levels, experience and language skills,

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employment costs as well as the availability of office s pace. These are, however, not the only factors taken under consideration. Investors also consider: the ease of running a business, commitment and help from local authorities as well as the quality of life in a given region. As mentioned before, both the three main cities of the SSC/ BPO sector as well as cities aspiring to their rank are very comparable. Just like general employment costs in Poland are 40-50% lower than in Western Europe or the United States, the salaries in the branch in the abovementioned cities vary by only 5-15%. Nearly 1.9 million students are currently enrolled in higher education facilities in Poland, which signifies that the country has a large pool of educated candidates – 90% of the employees of the modern services sector have a higher education. Although aquiring a well-qualified staff has never been a problem in Poland, the country’s “Achilles heel” in all large cities, apart from Warsaw, has been, until recently, lack of modern office space. Currently large cities, including Cracow, Wroclaw and the Tricity have very well developed and comparable office facilities – jointly over 1.1 million m2. The Tricity’s discriminants Human capital The Tricity area is home to nearly 30 service centers, which employ 12 thousand specialists. 105 thousand students are currenly enrolled in the Tricity’s 29 higher education facilities, which means that the city annualy generates a pproximately 23 thousand graduates. This ensures the availability of experienced candidates, and – equally important – indcates, that the market is far from being saturated. The hypothesis regarding low market saturation is also confirmed by the low coefficient of center employee rotation, at the level of 4-8%, and low pressure of pay rises (approx. 5% annually). Based on the Hays’ salary report for the period from January to March 2011 it can be extrapolated that the wage levels in the SSC/BPO sector in the Pomeranian region are among the lowest in the country. Hiring a graduate is linked with a gross salary of 2 000 – 2 800 PLN, while managers receive a gross salary of approx. 6 000 – 7 500 PLN. Close cooperation between the business and academic circles also deserves attention. The University of Gdansk, in collaboration with Thomson Reuters, launched a fi nancial and banking program, in accordance with competence development requirements of the employment market.

A further example is the BPO Academy program initiated this year, targeting the students of secondary schools in the Tricity area, the objective of which is to prepare a necessary pool of candidates for work in the sector. Language skills The Tricity’s residents have good English and German language skills, due to the fact that these languages are taught at colleges and universities, and also due to the tourism in the region. In addition, the Tricity area also stands out as the center of Scandinavian languages (Norwegian, Swedish, Finnish and Danish). 59% of all those who have mastered a Scandinavian language in Poland live in the Pomeranian region. In addition, other European languages are also used in the area (Russian, Portugese, Serbian), as well as Chinese and Arabian.

January / February 2012

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Available office space The Tricity is the third largest regional market (after Cracow and Wroclaw) regarding office space, yet the a vailability of office space is the largest in Gdansk, Gdynia and Sopot. Available office space has doubled during the last three years, and currently these are 350 thousand square meters available which fulfill the Class A office building category’s requirements. By the end of 2013 approx. 150 thousand additional square meters will be available for use in new office buildings, which will further improve the status of the agglomeration and decrease rent costs. The costs of rent in an attractively situated Class A office building oscillate around 14.5 euros per square meter.

of international s chools and preschools, the number of flights and travel time to a country of origin, numbers can also be used to express the magic of a given city. Magic is the one this the Tricity area surely does not lack: the city is capable of e nchanting all v isitors. The city is neither small nor p ostindustrial – it is a city which links both tourist appeal and business possibilities. The agglomeration is developing at a steady pace, organizes many events –the music festival Heineken Open’er or the Shakespeare theatre festival, and offers various sports-related possibilities, including water sports, golf and winter sports. The large number of ways of spending leisure time attracts new residents to Gdansk, Gdynia and Sopot – both from Poland and from abroad. Support for investors

The city’s features Over 60% of the executive staff in service centers are foreigners who reside in a given country for the duration of their contracts, often along with their families. This is why it is important that these people feel good in their city of residence. Just as one can measure the number

The Tricity offers good, high-quality services for investors, provided both by local government authorities and by specialized regional agencies. One of the ways in which the region facilitates investments is by assigning a Project Manager, who helps out during the investment realization process in an ongoing manner. Local authorities assist in contacts with recruitment agencies and real estate agencies, and help secure competitive rates for services. Yet will the city continue to attract not only new residents, but also new investors? The Tricity exceeds requirements concerning the location of good modern services centers. This fact, combined with the implemented strategy and long-term regional development plans, allow us to believe that the Tricity will soon join the ranks of the three largest Polish cities in the branch, and enter the A League of the SSC/BPO sector.

Author Kinga Kurpiel Manager PwC

Author Szymon Kogut PwC Consultant

PwC Warszawa Al. Armii Ludowej 14 00-638 Warszawa pwcpoland@pl.pwc.com www.pwc.pl

January / February 2012

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January / February 2012

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Strengths of Tricity General overview Tricity is an urban area consisting of Gdansk, Gdynia and the tourist resort Sopot. The whole urban area encompasses some 1.26 million people, including Rumia and Pruszcz Gdanski. Tricity is the fifth most populated area in Poland after Katowice conurbation, Warsaw, Lodz and Krakow. Tricity is an important centre of the economic, scientific, and cultural life, and a popular tourist destination. For centuries it has played a key role in the trade between northern and western Europe on the one hand, and central and eastern European countries on the other hand. Today, Tricity offers a well-developed business infra structure and a highly qualified labour force. With the influx of international corporations, the city is now turning into a modern, knowledge-based economy. The fastest developing industries of the region include tourism and business services. A number of current infrastructure investments such as A1 highway, PGE Arena sport stadium, the railway track renovation, the new airport terminal, business incuba tors and new roads will surely trigger the city’s investment attractiveness. Office stock The modern office space supply in Tricity is e stimated at 365 000 m2 This makes Tricity the fourth largest o ffice market in Poland – preceded by Warsaw, Krakow and Wroclaw. However, the modern office density index is relatively low – there is only 70 m2 available per one c ompany (over 10 employees) based in the region. Over 60% of the office stock is located in Gdansk, mainly in three locations: centre of the city in low class, refurbished buildings, Wrzeszcz and Oliwa districts (Grunwaldzka Av. area) and in the vicinity of the airport in Rebiechowo. Office buildings in Gdynia are located along the main roads leading to Gdansk –Slaska & Wladyslawa IV. Smaller blocks are in the central area (Swietojanska, Batorego, 10 L utego streets). Business park facilities are being built along L uzycka Street. Sopot remains a city with the smallest contribution to the total office stock in the agglomeration. Office space is

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t ypically located in villas occupied by local companies. Some office space is also offered in the buildings scattered around the centre. Supply The first substantial office project – Baltic Business C entre was built in Tricity back in 1995. The bonanza years came after 2000 when numerous projects were delivered, including headquarters of Grupa Lotos – the first project with more than 20 000 m2 of office area. The market reached a climactic point in 2008. In this year around 55 000 m2 of office space were delivered in ten separate projects. The most distinctive schemes today are Arkonska Business Park in Gdansk and Luzycka Office Park in Gdynia. The characteristic of the Tricity office market is the predominance of local developers such as Allcon Investment, Grupa Inwestycyjna Hossa, Torus, TPS or Euro Styl. The total supply of modern office space in Tricity exceeded 365 000 m2 by the end of 3Q 2011. Currently there is around

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70 000 m2 of office space under construction in Tricity. The largest developed office schemes in 2011 include Olivia Business Centre – Olivia Gate developed by TPS. Alchemia by Torus, Garnizon.biz – Omega & Gamma from GI Hossa, the first phase of BCB Business Park and Opera Office are under construction. Among new significant additions to the market, planned for the next years there are such schemes as Neptun by Hines, next phases of Olivia Business Centre, Garnizon.biz and BCB Business Park. As the office demand in the city has been growing, the market absorption potential is still high and the new, high class premises are well desired both by newcomers and existing tenants. At the moment, for a company looking for a 4 000 m2 office for the next year, there are 7 options (including buildings under construction).

Office Supply in Tricity

Office availability in major cities (1 000 m2)

In the whole Tricity region there is a large availability of post-industrial, development land, including the former shipyard in Gdansk and in Gdynia. The sites are usually c onveniently located, along the major transit roads, close to the city centre. In the further future, those areas might be redeveloped into successful business or multifunctional areas. Office demand Until 2006 the total annual take-up in Tricity was oscillating at the level of 10 000 m2. In 2007 this volume increased to 20 000 m2. Many BPO (business process offshoring) tenants like First Data Global Services, Thomson Reuters, Kainos and Nordea Bank, who decided to lease the office space for their operations in Poland, moved to Tricity. 2008 was a record-breaking year in the Polish real estate market. During that time Tricity has seen a record take-up volume of over 60 000 m2 Arla Foods, Geoban Grupo Santander or Acxiom entered the market. In 2009, due to the economic slowdown, the interest in the Tricity m arket decreased, although in the end of 2010 it returned to its growth path. Strong economic basis and development of BPO and SSC sector in Poland, again generate the d emand for office space in Gdansk and Gdynia. Largest recent leases were signed by such companies as Energa Group, Jeppesen, Wolters Kluwer, Netia, Ericsson. Tricity is the third the most popular BPO/SSC location in Poland. What is important, Tricity does not attract low-cost companies but those from a so called KPO sub-sector (Knowledge Process Offshoring), offering more s ophisticated processes and looking for highly qualified professionals.

Vacancy The vacancy rate in all modern buildings in Tricity, including owner occupied ones totalled around 7% in the end of 3Q 2011. This means around 25 500 m2 available immediately in total. It was generated mostly by vacant B class office s pace and recently delivered projects that are not fully leased. This space should be quickly absorbed by the growing BPO sector in the city. Office rents Prime rents for high quality office buildings in Tricity have recently stabilized. At the moment they range between EUR 13 and 16 /m2/month. The average rents in the region vary from EUR 11 and EUR 14. We expect a stable trend in Tricity within the next 12 months.

Author Joanna Mroczek Director, Head of Research & Consultancy CBRE

January / February 2012

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Comments to the CBRE Report The entire Central-Eastern Europe, that is, Poland, Czech Republic, Hungary, other Baltic countries, such as Lithuania and Estonia, and some Northern African countries (such as, until recently, Egypt) can be viewed as a single entity in terms of costs. This becomes especially apparent if we compare them to Western Europe and the USA on the one hand, and India and remaining Southern Asian states on the other. When it comes to Central-Eastern Europe, the analyses of costs and benefits look similar. The Tricity is only slightly cheaper than Budapest or Warsaw, whereas the availability of human resources is comparable to Wroclaw and Lodz. A stable real estate market in the Tricity helps to attract investments, says Mariusz Wisniewski, Senior Negotiator and the Head of the local CBRE office in Gdansk. Dymitr Doktór: While reading your report on the Tricity office market, one may get a feeling that there’ll be a record- breaking supply in office space. Have building companies miscalculated the demand? Mariusz Wiśniewski: Since 2009, the supply is similar to emand, with vacancy rate of around 9 percent. C d urrently, it’s 7 percent. That’s not a big figure — roughly 25 000 sq m. If four or five large companies express their interest, the entire available space will be leased. The issue of a ‚record-breaking’ supply may be seen differently if we look at the percentage rate of increase in space, which remains more or less constant since many years. We think that the Tricity’s building companies take account of the demand. DD: If so, where does the demand come from and what’s its main source? MW: In recent years, the demand is triggered by the clients who open their accounting, financial and IT c enters in the Tricity. Moreover, local companies not only seek new and efficient offices, but also, due to their growth, additional space. We may also see that the access to the Tricity has improved thanks to new motorways and proper flight connections. A couple of years ago, the issue of communication b etween the Tricity and the rest of Poland was very often raised d uring the talks with investors. This was an argument against locating their capital here. Now, such problems are becoming a thing of the past. DD: How is the market in other Polish province capitals? From the Tricity’s point of view, the situation is very favorable. Now, in Wroclaw, vacancy rate amounts to less than 3 percent, while the total space ratio is more or less equal to the Tricity’s. If the amount of vacancy rate falls to 2 or 3 percent, tenants may experience serious problems with finding space at competitive prices. We had such a situation in the Tricity in 2008, when three companies wanted to buy office space located in Arkonska Business Park. There was a risk that we could lose one of the clients, but eventually one of the two buildings, which were under construction

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Mariusz Wiśniewski Senior Negotiator and the Head of the local CBRE office in Gdansk at the time, was entirely leased by GE Money. As of now, this shouldn’t happen again on the Tricity market. If a client is interested in leasing 1 000 sq m, he has many locations to choose from. One of the recent examples is our client Laureate, which had as many as 8 different rental options on very flexible terms, whereas in other cities the offer was significantly limited. Apart from that, there is too much supply in other cities. For example, vacancy rate in Lodz amounts to 20 percent since quite some time.

Poland vs Outsourcing | Report

DD: It appears from the report that in the Tricity office space is being developed only by local developers. That’s true, and I see how this may prove beneficial for a possible tenant. In my opinion, the Tricity market is more competitive than, for example, in the case of Wroclaw, where it’s dominated by few developers. DD: Isn’t it only a matter of time before the Tricity market becomes dominated by large Polish and international developers? I don’t think so. We heard many times that they want to enter this market, but so far they didn’t make any real effort. It is to be expected that the market will still be dominated by local developers and remain stable. Strangely enough, a small local company, which has moderate financial assets, is not able to supply a huge amount of space at one time and destabilize the market. DD: For large corporations, a local building company may seem to have little experience or deliver lower quality of office space. Are the local builders able to satisfy the needs of global businesses?

DD: The situation on the office market seems promising, but you must admit that this is not the most crucial factor taken into account when choosing the location for a new outsourcing center. Since many years I’ve been participating in a few tens of meetings with investors and, without exception, the main factor for them was the availability of skilled human resources. The situation in the Tricity is not much different than in other cities. In reality, everywhere, apart from Warsaw, young people get similar salaries and that’s what attracts investors to province capitals. The Tricity has an advantage over other locations thanks to the quality of living and the situation on the office market. DD: Everything seems to look so bright. However, do you see any downsides of the Tricity? Well, the fact that we’re comparable to others is good, but, in the end, if details are to decide, the lack of noticeable advantages may become a sort of disadvantage. We have to un-

I have to admit that in the Tricity the building companies construct facilities with a slightly better standard than in other province capitals. In Lodz, for example, there is much office space in renewed buildings, which will never be as efficient as in the case of a new building, yet still, such buildings are also described as A-class. It’s worth remembering that the building standard listed in an offer is often a sales gimmick. ‘A-class’ should be used in reference to facilities offering high standard of finishes, as well as located in a p restigious, accessible neighborhood at the very heart of a city. As far as engineering details are concerned, we should mention raised floors, individually-controlled advanced central air-conditioning systems with humidifiers, as well as complete cabling and UPS systems. The third factor would be power supply – buildings must have at least two independent external power supplies and power generators. In this case, Arkonska Business Park in Gdansk and Luzycka Office Park in Gdynia provide the best solution. Many companies require a high level of power security due to continuous workflow, data storing, or simply for comfort. As for negative associations, it should be emphasized that the Tricity developers are not as powerful as other Polish or international companies, but they’re well prepared for talks with foreign businesses which seek office space. Some of them operate on the market since more than ten years and their portfolio includes local clients, but also very demanding American corporations, such as Intel, IBM or Synopsys.

January / February 2012

Poland vs Outsourcing | Report

derstand that when it comes to competing with other cities, the decisive factors boil down to the ‘icing on the cake’. This doesn’t mean a new stadium or theatre. In the case of Gdansk, for a long time this was a student scholarship program. Such scholarships were used to c over internship costs for students working as interns for foreign investors operating in Gdansk. It would be advisable to continue this project, but in a modified form, because companies are not likely to send abroad trainees, but people who at some point are to become managers. It is my proposal to use for this purpose the local government companies which have sufficient income to provide such scholarships not only to students. In my opinion, annual expenses related to such an undertaking won’t amount to more than PLN 100 000, whereas the Tricity’s competitiveness will greatly improve from the point of view of the BPO investors. It should be noted that, for the local government, new outsourcing projects mean not only new workplaces, but also the inflow of tax money. If we start looking at it this way, such a ‘small’ investment may quickly pay off.

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DD: How about the institutional assistance in the Tricity? Investors tend to think that there’s a ’little mess’ in this area. Since a year, an entity under the name of ‘Invest in Pomerania’ operates in the Tricity and tries to clean up this ‘mess.’ The beginnings are great, but the idea of a single place where you can take care of all the formalities needs to be strongly advocated for. It is important for such an entity to have not only funding for promotional activities and a solid information package. Investors care much more about the support in recruitment, financial assistance and quick reactions when the local government is needed. Fortunately, I know that Pomerania Development Agency, which is a leader of this undertaking, understands it very well. DD: Thank you for the interview.

Education vs Outsourcing | Articles

BPO – Definition of the Industry in November of 2011, it is considered that five c ountries currently have a well-developed outsourcing m arket. These countries are: India, the Philippines, China, Brazil and Poland. The term developed market means that at least 50 BPO centers or advanced IT services centers operate within a given c ountry. Poland is the first E uropean country with a developed outsourcing market. Currently ¼ of all c enters operating in Central and Eastern Europe are located in Poland. Poland’s popularity, as well as the popularity of other countries in the CEE area, increases with each following year, as this geographic region currently p rovides the best p ossible comprehensive services and advanced BPO services. The sum of all factors crucial to launching and providing BPO services varies and is composed of many elements. The most significant of these include: economic and political stability geolocation the development of information and communication technology availability of qualified workers multilingualism availability of developed real estate costs involved in running a business high quality of provided services The list is much longer. The above includes only the key conditions taken under consideration when establishing an Operation Center capable of providing a full range of BPO services. This concerns both international BPO corporations and small, local companies. „If there’s something we cannot do more efficiently, c heaper or better than our competition there is no point of doing it and instead we should hire someone who would do a better job than us.” This famous quote by Henry Ford is the motto of many outsourcing companies, and especially organizations which handle business process outsourcing (BPO). The above quote is also ever-present in statements and publi cations in which authors describe outsourcing-related issues. Ford’s words ideally convey the essence of outsourcing.

BPO services are mainly used by large, developed organi zations and by the public sector, but also by Tier 2 companies – corporations which do not classify in the TOP 100 or even TOP 500 most recognized companies in international rankings, but are assessed as – due to their structure, revenue, or transaction volumes – SMEs (small and medium enterprises); either within the upper limits of this classification or just beyond it.

Business Process Outsourcing is of the most rapidly developing branches of industry. Its roots can be traced back to the 1980s, when information and c ommunication services began developing in India at a fast pace. India was one of the first countries to notice the potential in carrying out processes for entities situated in remote geographic locations. Subsequently, other countries began offering BPO services. According to Everest Group’s report, published

When entrusting its processes to an outside company, the ordering party must be convinced that the quality of these services, as well as their timely execution and effectiveness, will not suffer. Often it is expected that the outsourcer will introduce improvements or innovations. BPO c ompanies must fulfill these expectations and prove that they are c apable of working steadily in a safe environment, while maintaining the highest level of quality over a long period of time.

January / February 2012

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The economic and political stability of the given country or region where the BPO center operates is also an important factor, taken under consideration when choosing a new business partner. Political and military upheavals that took place in North African countries in the beginning of the year 2011 increased the risk involved with m aintaining a BPO center in that region, despite the fact that the sector had been developing in Africa at an excellent pace for many years. Previously Egypt was considered the best location for e stablishing operating centers. BPO centers were established in Egypt by companies such as: Vodafone, Infosys and Wipro. As reported by Age Magazine, Vodafone decided to transfer its center to Great Britain due to the political situation in North Africa, to ensure the safety and stability of provided services. Other global investors also decided to retreat to their own locations and search for new and safe business regions, creating an opportunity for Poland and other Central and Eastern European countries. The migration of BPO centers out of Egypt has become an important issue for the country’s government. Biztech Africa informed that a team of experts was appointed in March of 2011 to maintain and stabilize the Egyptian BPO sector. Geolocation is yet another important criteria; both for investors and for the BPO sector’s clients. On the one hand

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locating centers in a completely different time zone may cause business processes to be completed within one b usiness day (e.g. data input, reports, presentations, fi nancial a nalysis, programming, back-office tasks – including email and fax correspondence or customer inquiries sent via websites), but it may also lead to communication c hallenges. On the other hand, cooperation with a company from the same or neighboring time zone may allow for quicker communication, but process realization periods remain the same; in this case more advanced processes can be delegated, which require ongoing contact between the ordering party and the BPO center, such as receivables management, management of accounts receivable, debt recovery processes, purchases, taxes, employee recruitment, staff-related processes, legal matters (LPO – Legal Process Outsourcing), or knowledge-related processes (KPO – Knowledge Process Outsourcing). Distance (nearshoring or offshoring) is not the only criteria taken under consideration when choosing a service p rovider. Human resources are also an important element of the decision process – including education, competences and language fluency. The fact that Poland has recently become one of the most popular countries for BPO investments and that more and more ordering parties have d ecided to outsource their tasks to this country is no coincidence.

Education vs Outsourcing | Articles

Excellently prepared staff members are the reason for this development. Almost every Polish city has a university; most also have a technical university and various private higher education facilities. Year after year Poland gains approximately 400 thousand new graduates, with degrees in many fields, including fields which are of interest to the BPO sector; economy, finances, banking, foreign languages, law and information technology. Polish universities have begun offering fields of study inextricably linked with BPO, and have even started cooperating with the branch to offer series of lectures on the topic. Among these are the Warsaw School of Economics, the University of Lodz and the University of Szczecin. This is a very good sign for the BPO industry – as the range of BPO services is continually expanding thanks to a well-prepared staff. As mentioned before, the personnel has a direct impact on the quality of services. Higher education, p rofessional skills, good educational potential and training courses all allow companies to maintain high quality and are one of the criteria taken under consideration when choosing a BPO center. BPO companies often participate in various p rograms which certify the quality of services and the education of staff members. Among these programs, organized for entire BPO organizations and staff members alike, are ACCA, various ISO programs, CCA, and many others. Certification and quality programs are adapted to the profile of services offered by BPO organizations, including financial and accounting processes, CRM, Call and Contact Centers, staff and payroll processes. Most BPO centers also undergo cyclical outside audits – both those necessary to maintain certificates and those conducted by international audit corporations in order to confirm the conformity of management processes with regulations and norms. BPO centers which provide call and contact center services have begun frequently engaging the ordering party to participate in quality control. This is due to so-called calibration processes, where subsequent to an initial assessment of the quality of BPO services, the client participates in a joint assessment of the studied process. Thanks to client-BPO company cooperation it is possible to provide the highest quality of services. Companies which decide to cooperate with a BPO center must initially establish which processes to outsource, and which are to remain within the company’s structures. It is not recommended to outsource core processes. However all supplementary, auxiliary processes, which are a dditionally cost-consuming and require much time and human resources to complete, can be subcontracted to specialized BPO organizations. Core processes include those which pertain to maintaining a competitive edge, sales strategies and operational

s trategies, as well as those thanks to which a company is developing and generating revenue. Non-core processes consume generated revenue and mainly include financial, accounting, administrative, customer service, warehousing, logistics, marketing and reporting processes.

The BPO branch mainly handles financial, accounting and administrative processes, including: receivables management management of accounts receivable debt recovery staff-related processes payrolls financial reports payments taxes servicing loans, securities, credit card payments The structure of processes handled by BPO companies varies greatly. On the one hand these are simple tasks, such as: scanning, data input, inspecting data accuracy, on the other – these can be complex or very complex tasks, including: handling transactions, payments and receivables, establishing account balances or full financial reports required by other companies or entities.

January / February 2012

Education vs Outsourcing | Articles

Often the outsourced receivables management process commences with scanning, optical (OCR) and intelligent (ICR) character recognition and automatic migration of accounting documents as well as ERPs and CRMs. BPO service providers often utilize advanced technology in order to facilitate process realization; as exemplified by OCR and ICR solutions. Scanned documents are immediately archived, and are later processed based on electronic images of invoices, purchase documents, and other types of documents, thanks to which a smaller g roup of w orkers can h andle these tasks, and the error rate is m inimal. During further phases of receivables management BPO center employees are responsible for contact with their client’s suppliers, handle incoming enquiries (via phone, tax, e mail, etc.), and participate in outgoing campaigns in order to obtain copies of documents, explain discrepancies, establish and confirm account balances, or prepare and execute payments. Often a BPO company has access to its client’s bank accounts, as it prepares bank transfers, which are accepted and initiated by the client. Receivables management outsourcing allows the client to focus on financial, tax and budget-related strategies as well as other processes, while it is the BPO firm which handles recurring and time-consuming tasks. Outsourced receivables management processes include: invoicing and invoice distribution debt analysis elaboration of debt collection plans and strategies carrying out debt retrieval processes reporting preparing documents necessary to bring a matter to court Often the BPO firm participates in the print and d istribution of invoices (also in electronic form), and immediately undertakes receivables management-related activities. By allowing the BPO company to participate in the initial steps of the process, the client can be certain that debt retrieval will be handled in an optimal manner. The later the receivables management or debt collection process is outsourced, the smaller the chances that the debt will be collected quickly. Debt collection companies often face challenges of this sort. Debt collection is part of the receivables management process, and the BPO branch eagerly participates in the realization of the entire process, simultaneously taking responsibility for it and guaranteeing the highest quality of provided services, as often salaries are strictly linked with results.

alendars, track medical check-ups and vacation days. c Their tasks may also include calculating salaries, preparing payrolls, filing reports pertaining to significant indicators, etc. BPO companies may carry out these processes using their own computer systems, or in the client’s environment – thanks to which the client has full knowledge and control over the processes.

Yet another substantial and complicated issue faced by every organization is personnel and payroll services. BPO companies maintain employee files, oversee training

Often large companies outsource comprehensive employee recruitment processes: this is when cooperation with a BPO company commences. Outsourcing recruitment functions

January / February 2012

Education vs Outsourcing | Articles

is abbreviated as RPO. In Poland partial cooperation with recruitment companies or so-called “employee leasing” is practiced, yet recruitment, personnel management and payroll management processes can be fully entrusted to an outside company. Outsourcing – and employing the services of a BPO company – allows corporations to shift from constant costs to fluctuating costs. Maintaining large operation departments b ecomes redundant, personnel and payroll management is limited; this positively impacts a company’s financial management processes. Cooperation with BPO companies makes it possible to control the costs of such services. V arious indicators and contracts define the qualitative p arameters of services: the aforementioned quality is g uaranteed and is d irectly linked with the BPO organization’s salary. The BPO company is o bligated to provide ongoing information concerning its results, convey transparent reports concerning pre-established indicators: both qualitative and quantitative.

Based on observations of the hereto development of the BPO services branch it can be unambiguously stated that outsourcing will be increasing its presence in large and medium-sized companies: in both the public and the private sectors. The branch will thus be responsible for a broader range of tasks and will impact optimization processes, also in economic organizations, beyond the private sector. The public sector in many Western European countries has been depending on the services of BPO organizations for years, in numerous fields. These include: information and communi cation, prisons, police assistance, health, a griculture, infrastructure and finances. We hope that in Poland advance outsourcing will soon extend beyond conventional IT s upport and will become a permanent element of the operations of public institutions – thus guaranteeing taxpayers the highest quality of services. Outsorcing & More

Shifting some processes onto an outside organization allows companies to focus on obtaining their main objectives and on tasks thanks to which these companies can carry out significant processes which form the core of their business.

January / February 2012

Who is who in outsourcing? | Interview

Interview with Jim Costello CEO of SouthWestern BPS Ltd (Ireland) and CEO of SouthWestern BPS Poland Sp. z o.o. (Poland). Outsourcing&More: Jim, thank you very much for the opportunity to talk to you and have a discussion concerning BPO industry, SouthWestern expansion and current market demands in relation to advanced outsourcing services. Your background is finance and you had opportunity to work in large enterprises across the globe, can you tell us how did you join SouthWestern, please? Jim Costello: I worked for Unisys Corporation for 18 years at UK, European and Global levels. Unisys is a global leader in Enterprise Systems and Outsourcing. I left them in 2003 when I returned to Ireland. SouthWestern (SW) at that time were running Outsourcing contracts for the Irish Government in Agriculture (Animal traceability) and Transport (speeding fines) and I wrote to the then CEO suggesting that SW had an excellent platform for growth for the Business Process Outsourcing business and that this market has great opportunity. He believed me, and hired me as a sales director. It was a very successful partnership and SW has grown 10 times since then and is now the leading BPO player in Ireland and in the top 30 niche players in the UK. O&M: SouthWestern is one of the leading BPO companies in Ireland. Last decade was the dynamic growth from the Agri industry support going to very wide portfolio of services provided both to public and private sector. Can you tell us more about services provided by SouthWestern as well as the industries who are your Customers, please? JC: SouthWestern has evolved from the SWS Group which was originally established in 1957 and which grew through a major diversification programme to hold leadership positions in a variety of industry sectors. Our service o fferings are b ased around four pillars of Customer Relationship Management, Finance & HR, Public Sector and Financial Services to blue chip public and private sector clients. We have a strong track record of high quality service delivery to our clients which is underpinned by continuous investment in developing innovative solutions in process and technology. Client activity is conducted in a secure ISO environment with guaranteed confidentiality. Our four pillars are:

January / February 2012

1. Customer Relationship Management – Our CRM offers an integrated approach to Customer Relationship Manage ment and tailor solutions to meet each of our client’s unique requirements. We manage interactions by learning more about customers’ needs and behaviours in order to develop stronger relationships with them. Our CRM clients come from the banking, travel, Insurance and Public sectors and we deliver in 9 European languages on a 24/7/365 basis. 2. Finance & HR - we offer a comprehensive range of Finance & HR Admin services. Whether it is payroll, accounts payable, banking, collections, billing, general accounting or reporting, we employ a team of qualified accounting and expert administration staff to deliver results to our clients. Our proven delivery model has delivered numerous bene fits for our customers including improved flexibility and productivity, a reduction in the cost of operations and an improved customer experience. Our Finance & HR clients come from a wide and varied range of sectors – Financial services, media, telecoms, utilities, retail, construction, travel. 3. Public Sector - We are expert in the areas of Public S ector Services. We deliver our services to some of Ireland’s

Who is who in outsourcing? | Interview

largest Public Sector organisations including, the Department of Agriculture and the Injuries Claims Board. In the Public Sector, services are delivered for administration and customer service of local as well as central government. We are helping to deliver better services for citizens in an efficient manner. Creating these efficiencies can be seen as a great opportunity for the economy, by providing more efficient services to the citizen, reducing the costs of those services and helping to create International Traded Services jobs in regional locations. 4. Financial Services - our core business is our clients’ non core business. We provide our clients with a range of Business Process Services that free up their resources so that they can focus on their core strategy and innovations that grow their business. We save our clients money, increase their revenue, and make them more efficient in servicing their customers’ requirements. Our high-quality operations centres are set up to deliver innovative front and back-office services to regulated industries internationally. In the area of financial services, we focus on Savings and Deposits administration, Loan and Mortgage administration, Insurance Policy and Claims administration, Call Centre management, and other administration services.

things in common: Drink, religion and political strife! I am not sure if these three things are the same now, but it is very true that there is a very strong cultural similarity. In addition to the cultural link, SW was seeking a scalable operation, close to Western Europe, that could provide education and languages, at a reasonable cost in a stable political environment. Poland is by far the best destination for these criteria. We did do a full comparison with countries in Eastern and found Poland has the most potential. We also tested the Far East (India and Philippines). Even though they provide lower cost there were also several advantages for Poland including: Poland has a lot of Language skills Poland is close to the customer, and in BPO, where the work content is high value and rich, this is very important. Poland is a better cultural match to Western Europe. For medium size clients, it is not economically viable to transfer work so far away as India or other parts of the far east. So Poland was the best when we did the comparison of all countries. Then when we visited Poland and started working here we found that the National Organisations such as PAIiIZ, and the City organisations were very helpful to get us started. Lodz was in the best position for SW because of the focus by the city on education and especially education in business and languages. We were able to find property easily and the energy and telecommunication links were strong and reliable. We are really pleased with our move to Lodz and to Poland. Now we have 150 people there and in two more years we will double the size of this team. This work will come from UK, and Multinational firms that will continue to grow the contracts with SouthWestern. O&M: Thank you Jim. If we are talking about international presence and multilingual support, this probably requires a lot of language skills as well as quality control processes. Is it complicated or maybe difficult providing services in many languages? How do you monitor the quality to be sure the services are provided with the best quality? We heard about OTACE – what is this?

O&M: We already mentioned SouthWestern increased both the size of the business as well as the portfolio of services. In 2007 you decided to go abroad and open daughter company in Poland. Can you tell us why Poland was c hosen at that time and if your decision was to be taken again today, would you choose Poland again? What were the main reasons of choosing Poland instead of India or Romania for example? Also were there any preferences why you chose City of Lodz? JC: A few years ago I was in a taxi in London and the Polish driver told me that the Polish and Irish people have three

JC: Language should not be a problem when it comes to measuring Quality. We must provide the same excellent quality in all languages. Because of this our Quality control system includes measurement of quality by fluent and local language agencies. That is the only way to be sure that our quality is of high standards in all languages. OTACE stands for On Target Above Customer Expectations. This is a CEO level test of Quality that I as CEO send to all our customers. It is done to validate our internal Quality systems, or to find a mis-alignment for our Quality systems and the executive opinions of our clients. Our clients complete the OTACE survey online and these are then measured against our

January / February 2012

Who is who in outsourcing? | Interview

also work with the Unions and e mployee welfare and satisfaction is of the highest p riority. There is a lot of opportunity to add services to the Public Sector by collaborating with the private sector. Our investment in technology including technologies such as unified messaging (Combining phone, email and social media), workflow systems (answering citizen queries) and electronic commerce (for payments and revenue collection) can really add value to the citizen government/local government relationship and bring about a better served citizen.

internal quality system. If we see a difference, we need to fix our internal systems. So it helps to calibrate. We give feed back to all our clients after the OTACE survey to tell them how we will change things after their response to the survey and to thank them for their input. O&M: Quality is very important; more customers are at the moment looking into quality rather than low costs. This is also very important for the public sector organizations. In Poland not too many public institutions co-operate with BPO partners – can you give us some examples from Ireland and the scope of processes which might be supported by BPO industry? JC: In Ireland many Public sector organisations outsource their work to the Private Sector BPO’s. Examples include, Department of Agriculture, the Health Services, Education sector, and Social Welfare. The services outsourced include Human Resources and Payroll, Document management, Customer service centers, Collection of money, Information technology and many others. The Public sector can save a significant amount of money when they Outsource in the range of 25% to 50% savings. But in addition, the government can easily implement new services, add technology by asking the private sector to pay, and deal with s easonal fluctuation in activity. For Example the Department of Agriculture outsource Animal registration. This is very busy for a short period each year, with 80% of activity completed in the three months of March, April and May each year. The rest of the time volumes are low. By outsourcing, the Government does not need to keep high level of resources all the time. In addition the systems that verify and collect data are provided by the Outsourcing partner (SW) and all data is s tored safely by us. Public sector Unions are strong in Ireland also, so the private sector BPO’s must collaborate in a way that respects the rights of public sector staff. Thankfully this is possible because we

January / February 2012

O&M: BPO industry is quite big market, what makes custo mers to choose SouthWestern from the other market players. You are supporting banks, telecoms, food and drink companies as well as travel and construction industries. Each of them most probably requires different approach for the transition process, operation phase and further development – what are the main assets of SouthWestern? JC: The short answer is that “We are the best at what we do!” but you probably want a more detailed answer. There are five values that put us ahead of our competition. They are: Integrity: We operate like a national bank when it comes to security and integrity codes of practice. All our data is of the highest security, our staff sign confidentiality agreements, we guard our relationships with the highest of Integrity. When we say we deliver on time, we always deliver on time. When we say we will achieve a metric standard, we will always achieve this metric standard. This gives us a great reputation for delivery and it is better than anyone else in the business. Customer Focus: We build our solutions around the needs of the customer. The customer contract is often for 5 years and is almost always renewed after 5 years because of great service. The way we achieve this is by working with our customers as a “Partnership”. This means that we must always bring value to the customer and we must help them grow and change their business. Innovation: We invest almost 10% of revenue each year in Information Technology innovation. Our customers look to SouthWestern for the most modern way to run the business process. Therefore we are always researching the future and adopting and building leading technology. We have done this specifically for Unified Messaging (CRM tool for integrating Customer interactions whether by phone, Email, Web, SMS or paper), Workflow tools (specific for Financial Services, Utilities, Public Sector and Finance/HR), and Electronic Commerce (including Electronic billing and Payments)

Who is who in outsourcing? | Interview

Respect: Our staff are the first part of our company that the customers, and the customers of our customers see. The Respect for our staff and for people is at the centre of our HR strategy. Each decision in relation to people is driven by this value. This focus leads to long term investment in Training, Employee social committees, communication, focus on key resources and good manners in all dealings with people. “Can-do Attitude”. Many people admire SouthWestern for this simple value that is represented in every employee. When customers ask for new services, or changes, or help, we say “Yes”. When staff members need help in their work, we say “Yes”. There are many examples of can-do attitude and these are celebrated on a continuous in programs such as “Employee of the Month”.

O&M: We were already mentioning about quality and a little bit about management style. SouthWestern was three times honored with the Deloitte Best Managed Company title, is ISO 9001:2008 certified, CCA certified, in Poland two times you received European Medal for BPO services and you were also honored with Polish Economy Ambassador title as Business Partner to foreign enterprises. It’s a lot of prizes, are there any more? Do you think external audits and the prizes you receive are important for BPO organization? JC: The prizes are important for the external reputation of SouthWestern but more importantly we win the awards because of the internal quality of the company. A lot of inno vation and hard work goes into our quality processes. To get the external recognition is a great bonus and our staff celebrate the excellent environment in which we work. Often our prizes come around because our customers and partners nominate SW for these award programs. But then we go into a competition to win the awards, and as you have shown, we win many of these competitions. There will be more prizes, as we grow and as we develop we will always encourage our staff to seek external verification from expert organisations. This way we can show our customers that they are buying “World Class”.

Do you think that in global crisis BPO industry will grow or possibly stabilize or perhaps slow down? JC: Over the next three years we will double the size of our company from EUR 35 mln to EUR 70 mln. This will also increase our staff size to about 1 300 in Ireland, the UK and Poland. All locations should increase in size significantly. This is all possible because the Global and European markets for BPO are g rowing fast. The early adaptors are Multi ational companies and the UK. This is where sales will be focused. W ithin this we are focusing on Financial Services (Net Promoter Score and Retail Banking), the Travel Sector (Bac-office and CRM), Media (Back-office), Agriculture (Data processing and CRM) and Local government. The BPO industry will c ontinue to grow. Business Process Outsourcing is an agent for change, flexibility and innovation, so we are an ideal partner for businesses who wish to grow even in tough times. More and more, businesses will focus on the Core business activities to make them grow, including R&D, marketing, sales, production. Outsource the non-core stuff to the experts. O&M: Thank you very much and all the best for SouthWestern.

O&M: Jim, thank you very much for sharing with us with your experience. At the end we’d like to ask you for your plans. What are you planning for the next months and years?

January / February 2012

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