“Engagement is turning on a prospect to a brand idea enhanced by the surrounding context.”

Customer engagement can also refer to the stages consumers experience as they interact with a particular brand. This Customer Engagement Cycle, or Customer Journey, has been described as using a myriad of terms but usually consists of 5 different stages: Awareness, Consideration, Inquiry, Purchase and Retention. Marketers employ Connection Strategy to speak to would-be customers at each stage, with media that addresses the customer’s particular needs and interests.

The term ‘Customer Engagement’ is most often referred to in terms of online engagement with customers on the Internet. My interest lies in how we can apply the marketing practices of online marketers to the offline world. As traditional marketing practices begin to lose their effectiveness because of changing social practices (people watching less TV and spending more time on the internet researching and social networking) the challenge lies in how to engage the new generation of consumers without ignoring the value of their parents as consumers. The ‘interrupt and repeat’ advertising model is no longer as effective as it used to be because of the fragmented nature of media and audiences. The issue with the Customer Engagement definition is it assumes that consumers are all aged 18-26. Let’s assume that some of us (older) are not on FaceBook or we’re not twittering. Other generations still hold significant controls of consumer spend.

Customer Engagement should be viewed more as a mantra which is talked about beyond online marketing departments. As it becomes more difficult to keep customers loyal, and as the effectiveness of traditional advertising wanes, businesses will need to explore creative ways to engage customers and keep them engaged throughout their lifetime cycle.

The internet has enabled consumers to speak their minds about the products and services they like and dislike. It has also enabled consumers to become tribal again. They no longer voice their opinions in isolation but find peer groups with the same belief systems about a product or service. The internet has become a tribal-enabling medium. These common groups established over the internet have regained the power base from companies back to the tribe. If companies are to start understanding how to effectively address the changes brought on by technology, social practices and shrinking markets, they need to understand tribal behavior and how to engage tribes. Thinking needs to shift away from online and offline engagement and become centered on understanding tribal behaviour and how to influence tribal leaders.

Many companies refuse to listen to the tribe and are essentially living on borrowed time until a new entrant emerges who has listened to powerful tribe members that can influence the tribe’s preferences. The emergence of Linux as a major operating platform in IT is a testament to how powerful tribal leaders can change the direction of multiple tribes.

I can envisage a future where the fastest growing companies work in collaboration with their customers to design both products and services. Their business plans will have been written by tribal leaders of key customer types and power will be displaced from Board room to chat room.

The recent events affecting the global monetary system have placed all sorts of doubt on notions of the trade-off between monetary reward and time. A number of questions have been raised over where global currencies are headed and more importantly the faith in the future value of currencies. The events unfolding from 2008 to 2011 are unlike any we have seen before. The sub-prime mortgage crisis, global financial crisis, Eurozone debt crisis, China meltdown….what next? All of these events have led to the destabilization of some core beliefs held for so long by so many people, namely that:

1. Capitalism leads to greater prosperity than any other doctrine
2. Wealth is determined by how much currency you have
3. Free market and competition are the cornerstones for economic growth
4. Governments are able to resolve our woes
5. Work hard and you will be rewarded with a valuable amount of currency for your efforts

Most of the core beliefs listed can be challenged further and debated as to whether they are widely held beliefs or not. The point is these beliefs are now being seriously challenged with the unfolding of global events over the past few years. What is clear is there are a number of unhappy, discontented and disillusioned people out there. Millions have lost their jobs, their savings and their comfort of knowing what their futures will be like. The instability of not knowing and being constantly hit with a barrage of bad news has led to civil unrest as seen around the globe.  Whether it’s the riots in Greece, UK or the Middle East or the Occupy Wall Street movement the message is fairly consistent amongst protestors. The theme of their messages, when you break it down to its elements, is all about a cry for change and dissatisfaction with their living conditions. This anger is often directed at government and industry. What are the protestors trying to communicate? To answer this question you have to look beyond the messages on the placards and the cinders of the burnt-out cars and destroyed properties.

Maybe what the protestors are ultimately trying to communicate is their fear that their not sure what to believe anymore. One of the key issues that needs to be addressed from all of this turmoil is how do we give people hope in the future? How do we give them something they can believe that will not be overturned in a few years’ time?  How do we give people control of their destinies? How do we give people access to basic necessities such as food, shelter and clothing? The events over the past few years have created a destabilised, distrustful and disillusioned population all over the world. Millions of people only know the word “austerity” and have no idea what “prosperity” will look like in the future.

I don’t have all the answers to these very complicated issues. However, I have learnt to believe in one ironclad truism: “time is the most precious commodity”. Just think about this concept for a moment. Time is the only finite commodity we all have. It can be traded for paper based currency to increase traditional wealth that is based on material objects. Time, as you get older, becomes scarce and therefore should become more valuable since it is finite and one day we all will run out of this commodity. So time is an appreciating commodity that can be traded: my time for your $. What is also unique about time is that it is truly a universal currency that has equal value across the globe regardless of your country’s GDP or currency value. This old notion, time is money, when re-examined may better serve us as “money is time”. Maybe the new currency of the future is in fact time itself and not paper based currency or material goods. Changing the world order based on the currency of time is a tall order but we need to start somewhere. I hope this blog gets you thinking.

]]> http://joetawfik.com/2012/01/10/money-is-time/feed/ 1 Joe Tawfik 033 http://joetawfik.com/2011/12/29/bpo-predictions-for-2012/ http://joetawfik.com/2011/12/29/bpo-predictions-for-2012/#comments Thu, 29 Dec 2011 13:13:06 +0000 Joe Tawfik http://joetawfik.wordpress.com/?p=175 Continue reading »]]> It’s that time of the year again. Time to review what happened in 2011 and lay down some predictions for 2012. If anything we can all agree that 2011 was a very eventful year. We saw major global events unfolding that will surely be recorded in time as significantly historical. I thought it would be worthwhile to lay down these key events that occurred in 2011 before we get started on some of the predictions:

1. Arab Spring: major civil unrest across the Middle East and North Africa
2. Overturning of governments: Egypt, Libya, Tunisia, Greece
3. Civil unrest in the UK, Greece, Spain and Russia
4. Death of key strongmen: Gadhafi, Kim Jong IL
5. US debt crisis
6. European debt crisis
7. Japanese earthquake and Tsunami
8. Christchurch earthquakes
9. Queensland flood
10. Thailand flood
11. Philippine flood

These events, in one way or another, would have touched each and every one of our lives in 2011. Such significant events have not only sent global markets on a wild rollercoaster ride but have managed to influence every business plan in the corporate world. The GFC had managed to affect 86% of all BPO providers to one degree or another. The impact of 2011 will be closer to 100%.

My last set of predictions for 2011 outlined the need for BPO providers to reorganise their businesses to be able to compete more effectively by addressing growing economic and political pressures. These challenges were further compounded in 2011 by the turbulence experienced in the markets in response to the global economic, political, and environmental events occurring in 2011. It was a difficult year for BPO providers to determine whether to alter their direction or maintain a steady course and weather the storm.  The key factors to address in 2012 will be:

1. How to address lower BPO revenues from traditional sources such as call centre outsourcing
2. How to address risk effectively in BPO locations affected by political instability and legal deficiencies such as data protection laws
3. How to address commodity based pricing of BPO services
4. How to address growing staff attrition and increasing labour costs
5. How to address new competition from new low cost labour markets
6. How to address legal complications brought about by the proposed US Outsourcing Bill
7. How to address the impact of currency fluctuations to ensure your Gross Profit is maintained

A report produced by Ovum concluded, from their research, that a number of firms surveyed are reluctant to outsource their business as they consider it risky to offshore their business. This survey was undertaken in companies based in Australia, Europe and North America. Only 2% of the companies surveyed indicated they would be outsourcing offshore in a year’s time. I can only conclude that fear from executives to send their call centres offshore is brought on by the heightened sense of the risks associated. These risks are not only highlighted in the list of key issues to address in 2012 but also by the negative impact on customers from poor quality services.

One of the key strategies BPO providers can take in 2012 is to address the slowing down of traditional voice revenues by leveraging their relationships with existing customers and begin offering them new value-based services. These services should be specialised value-added services with a compelling ROI. This will enable a BPO provider to move into the trusted partner level with their clients and move away from the commodity single service provider. By opening up the types of services offered the BPO provider can increase their addressable market opportunities and position themselves to become a sustainable BPO provider in the future. A report undertaken by NASSCOM and Everest India has identified that the Indian BPO industry can increase its revenues five-fold from its present revenue to reach US$50B by 2012 by extending its capability and footprint. Countries like India can address their current challenges in voice by reviewing their assets and points of differentiation.  For example, their highly skilled legal and medical workers can be used to provide new specialised services such as legal support.

We are seeing an increasing number of corporates using outsourcing to address a number of the economic challenges they are faced with. A recent study conducted by TPI covered the latest strategies adopted by global 2000 companies in the outsourcing industry. They identified that there was a drastic change in the outsourcing sector. Companies are willing to spend more compared to previous years but have tighter expenditure policies now. The report says many companies are looking at depending fully on outsourcing and are seeking a full solution at an economical budget. The opportunities in 2012 will be to:

1. Increase capability and footprint to offer corporates specialised services
2. Leverage from unique assets that your BPO country/city offer
3. Reduce the risk for corporates by providing economical and safe solutions
4. Become part of the growing move towards shared services
5. Devise creative pricing models that contain an element of risk and reward
6. Increase development and engagement of staff to address the growing attrition rate
7. Increase innovation in your company

In my 2011 report I highlighted that we would see an increasing number of mergers and acquisitions due to greater access to cash. What we saw in 2011 was a slow start to mergers and acquisitions but a strong finish in Q4. Key transactions were made by companies such as Exls, Capita, Genpact, Xerox, Infosys and Aegis. I would expect this activity to continue to be mostly strong in the middle market space in 2012.

With an addressable global marketplace estimated at $450 billion the BPO industry is continuing to be a major economic powerhouse to most countries. Gartner states that the global BPO industry is anticipating a global growth of 6.3%. However there are some noticeable exceptions worthy to keep track of in 2012.

The report highlights that the Asia Pacific market (India, China, Philippines and Australia) is likely to see a 17.9% growth in business. This region is by far the shining star in the industry. China is seen as the key growth contributor in the region with expected annual growth of 20% to 25%. The reason for this is not only because of the amount of work outsourced from the US and Europe but also because the region faired a lot better than the US during the financial and currency crisis.  The growth expected in the US is much lower at only 3.8% and Western Europe may have growth up to 8.9%. The rising star globally is Latin America which is expected to grow at 14.7%.

Have a great 2012 and keep smiling!

1.     President Obama’s push to retain jobs in the USA and to provide incentives for companies to hire Americans

2.     The devaluation of the US dollar and the effects on other currencies, especially low cost base regions undertaking BPO work

3.     Wage pressures in some BPO locations further reducing the attractiveness of labour arbitrage

4.     Uncertainty in political stability of some BPO locations leading to slower than expected investments in some regions.

These factors affecting the industry in 2010 will continue to shape the industry in 2011. Economic instability in Europe, especially in the UK, will force many companies to rethink their customer management strategies. I would expect to see further outsourcing to lower cost base centres such as South Africa for predominately English speaking services and it will be anyone’s guess as to who picks up the multilingual services now that Egypt has become unstable. Bulgaria, Romania or Turkey could be worthy recipients of European language based services.

2011 could be a year where we see a shift in traditional outsourcing regions as the heavyweights in the industry begin to shift some of their business to emerging regions in the hope they can offset the challenges they face in some of the more overpopulated BPO regions. The choice of location will be interesting as well. As technology now easily permits the seamless management of multiple smaller centres the option of moving away from the mega centres to smaller centres could see a change in the way the large outsourcers undertake their business. There are advantages and disadvantages to operating smaller interconnected centres as opposed to mega centres. Some of the considerations in 2011 that will drive the decision making of the larger operators will be:

1.     Size of exposure to one particular economy

2.     Labour pressures in one particular region

3.     Currency exposure

4.     Inflationary pressures

5.     Political stability

6.     Redundancy and follow-the-sun solutions

The cost of data links has come right down and the maturity of VoIP and virtualisation has increased making the equation right for new and innovative approaches to operational delivery of services.

2011 is likely to also see further consolidation as larger players try and acquire smaller operators and also buy their way into new markets. Companies like Aegis will continue to penetrate the marketplace by their sheer mass and the forward momentum of their aggressive M&A strategy. In general we would expect renewed M&A activity in the industry as cash becomes more easily accessible to companies.

Growth in the industry is likely to come from immature markets such as Africa and the Middle East. I would expect to see some large outsourcing deals coming from this region. The current unstable political and economic climate in Egypt is likely to create opportunities for surrounding countries in the region. Cultural differences and access to experienced management will remain the largest obstacles for foreign companies to enter and succeed in these marketplaces. We are seeing some real growth opportunities in countries such as Saudi Arabia but the challenges to enter and conduct effective operations will be very high and likely to prove too difficult for most of the larger players.

Anti-Government Demonstrations in Egypt

The two largest BPO countries, India and the Philippines, will continue to compete with each other in 2011 for the title of leading BPO destination. We learnt in 2010 that the Indian BPO and contact centre industry was responsible for adding five million jobs and $15 billion in revenue.

2010 was also the year that the Philippines overtook India as the contact centre outsourcing capital of the world, according to industry data and the Philippine government. A report from IBM released in October 2010 said the Philippines had this year passed India as the global leader in business process outsourcing in terms of the number of people each country employed in the sector. “For business support functions… the Philippines has taken over the lead in the global ranking from India, after having challenged the top position for several years,” the report said.

The Philippine’s’ outsourcing sector could more than double its revenues and workforce by 2016, according to an industry road-map released by the Business Processing Association of the Philippines (BPAP) in 2010.

The roadmap, dubbed “IT-BPO Road Map 2011-2016: Driving Global Leadership”, projects the business process outsourcing (BPO) sector growing its revenues to $25 billion and workforce to 1.3 million by 2016, from $9 billion and 500,000, respectively, today.

However, to achieve these, the BPO industry in the Philippines must accelerate talent development initiatives and obtain stronger government support.

A key driver in 2011 will be the importance of enhancing the customer experience. I would expect that given all things being equal the desire to improve the customer experience will remain the most important component in the decision making process in 2011.

The International Quality and Productivity Centre study in India found that 72.2% of respondents said that enhancing their customer experience is one of their top priorities. This is a significant figure highlighting a market trend that is no longer driven by costs alone. This figure is also very encouraging as it demonstrates matured thinking in outsourcing and the various components that need to be considered. Customer experience is at the forefront of people’s thinking meaning we are likely to see more thoughtful decisions that will ultimately produce greater results for companies in 2011.

I have lived and participated in numerous projects over the past 15 years that have attempted to interpret how to improve customer experiences to create better customer relationships. In my view many of the companies have ultimately failed in this task because of the lack of leadership and organisational support for such projects. In my opinion the problem lies with the approach taken with such projects. Instead of looking at ways we can make the customer experience better we should perhaps start off by asking everyone in the company: what are the things that send our customers packing to the competitors and hurt our brand for good?

Think about this for a moment: isn’t it better to work out what turns our customers away before we start looking at how to make things better? Often the focus for these customer relationship exercises  are contained within the call centre or retail environment. What many organisations fail to understand is whatever good is created in the call centre may be completely neutralised by a negative experience elsewhere. The net result is that very little is achieved in regards to actually providing a positive measurable value back to the organisation through better customer relationships.

Let me share with you an example. One area of a large US bank spends a lot of money trying to win over customers and sell them new products. The customer feels good about the bank and takes a financial product such as a credit card. The customer has an average relationship  with the bank until they are late to make payment on a due date. The bank then sends this customer to their “harassment” team to ring this customer up and alert them that they are late. Now this “harassment” team is using a predictive dialler and are calling this customer up 3-4 times a day. This customer is unable to take calls because the customer is now overseas. The customer finally takes the call and to his amazement the number of calls are all related to an overdue of $20. The customer informs them not to keep calling him as he is overseas and to send him letters or an SMS. The member of the “harassment” team continues to advise they will call him regardless as it is within their rights. The customer at this point is unhappy and cant’s wait to write a blog about his negative experience and tell the world how unhappy he is with this pathetic bank. Yes, of course the customer I am referring to is me.

The readers of this blog should start thinking about all the various customer interactions that send their customers packing….disconnections for non-payment, unreliable services, poor billing statements etc. These are the reasons why customers leave you and head off to the competition. There is no amount of good relationship building at the call centre or retail outlet that will change this. Perhaps, if companies started their customer relationship projects by reviewing all the reasons why customers leave then perhaps their energies would be diverted to fixing these issues before they embark on any customer journey exercises. It appears that the key is to work out the critical starting point in any customer improvement exercise. As outlined in this blog it is my opinion that the key starting point is to address all the known reasons why customers leave us first before we begin addressing how to enhance the relationship with our customers.

To me this sums up the theme for the first decade of the 21^st century. It has been a difficult decade. There is no mistake about it but it has offered good endings that should put us in a good stead for the next 10 years. Let’s have a look at some of the highlights of the last decade.

In 2000 G.W. Bush was elected as president of the United States and the Sydney Olympics took place. No guessing which event was the favourite! In 2001 the world changed when two planes crashed in the World Trade Centres in NY bringing the buildings crashing down. This horrific event not only shocked us all but made us all aware of how vulnerable we had all become due to poor foreign relations. For the terrorists it was a day of reckoning. These subversive groups had developed such deep hatred that their only recourse was to undertake the actions of 9/11. In the same year we saw another dramatic reckoning: the collapse of Enron. On the lighter side we also saw the release of the first iPod!

9/11 Event

In 2002 we again saw companies paying up for past mistakes, excesses and stupid choices. The Dot.com crash saw hundreds of dreams built on vapour and fuelled by greed evaporate. Ansett Airlines collapsed and so did WorldCom. Time had caught up with these companies and their legacy was to leave a long trail of damage that affected many loyal employees and trusting investors.

NASA’s safety procedures came under question early in 2003 when the Shuttle Columbia was destroyed on re-entry. Who would have thought that a small piece of insulation foam breaking off would lead to this disaster? By mid 2003 we were all fairly convinced that the next few years were going to be tough ones. The Iraq war began in 2003 because we had to get the bad guys of 9/11? Well we thought these guys were in Afghanistan but why did we head off to Iraq? Apparently they had some weapons of mass destruction and we needed to get them quick before the evil Saddam would push the button and we would all be vaporized. Of course later in the year the CIA finally admitted that there were no weapons of mass destruction and their ‘intel’ was not all that intelligent. We also learnt of a new threat: SARS. Some of us were certain that SARS and the missing weapons of mass destruction were one and the same thing. A major positive milestone was reached in 2003 when the human genome was sequenced. We also saw the launch of Skype and iTunes in 2003.

Some of us were feeling quite weary with all this reckoning happening around us when in 2004 Mother Nature decided to have its say by releasing a tsunami that devastated Southeast Asia. This disaster saw over 100,000 people die in some of the poorest areas of Asia. The dawn of social networking began in 2004 when Facebook was launched.

In 2005 Pope Benedict XVI was elected as the head of the Catholic Church. Whilst some felt the power of the Holy Spirit others were simply feeling hotter. In 2005 we experienced the warmest year since records began. Global warming had become a real hot topic….excuse the pun. The Kyoto Protocol came into force in theory and the recruitment process began to make the Kyoto Protocol a meaningful change agent for global warming. In the same year the bad guys were back with the Bali bombings. This horrific event was a day of reckoning that simply did not need to happen. Our growing thirst to socially interact was fuelled when YouTube went online in 2005.

In 2006 one of the “bad” guys, Saddam Hussein, was executed. Meanwhile, the goat herding seems to have overcome the might of the US defence forces as Osama bin Laden eluded capture and continued on his merry way somewhere in the foothills of…..With Saddam getting his day of reckoning so did Pluto. Due to its insignificant contribution to the solar system it got downgraded and was labelled as no longer a planet. This was a fairly harsh blow to Pluto. Meanwhile we were all still feeling the heat as Sydney recorded its warmest day on record at 45°C. Al Gore releases the movie “An Inconvenient Truth” and we all learn that we are all heading for a very large day of reckoning. Well some of us of course preferred to keep on playing ostrich and went out and bought a giant plasma so we could see the movie on the “big screen” when it came out on DVD. Another log was put on the fire of social networking when Twitter was launched in 2006.

Storm clouds started collecting in 2007 when Microsoft Vista was launched. We should have known at that point that bad things were going to happen soon. Russia started toying with its neighbours by cutting oil supply to Poland, Germany, and Ukraine in a dispute with Belarus. Russia gets upgraded by the US as a fully-fledged super power. Civilians all over the world start complaining about rising fuel and food costs.

In 2008 Oil hits US$100.00 per barrel for the first time. The Beijing Olympics happens as the storm clouds gather momentum. No goodwill sporting event was going to stop the perfect storm that came in the shape of the GFC. Markets started collapsing all over the world as credit started freezing. The day of reckoning was near for many who had helped fuel the GFC. Lehman Brothers, Washington Mutual and dozen other large companies collapsed. Thieves like Bernie Madoff got sprung. Governments stepped in as knights in shinning armour by bailing out many more on the verge of collapse. Americans finally make a life-saving decision and hire a leader that offers them change and hope for greater things. Barack Obama is elected president of the United States. Meanwhile, Bill Gates steps down as Microsoft chief (probably because of Vista!). The age of technology is confirmed as 4.1 billion people become users of mobile phones and 25% of the planet is on the internet.

In 2009 collateral damage from a decade of reckoning is taking its toll as depicted by US unemployment hitting over 10% and global unemployment increases substantially as a global recession takes control. If that wasn’t enough, Swine Flue erupts on a global level and pigs get their day of reckoning as thousands are butchered in places like Egypt. Mother Nature never does anything half-hearted and in February Australia has the deadliest bushfire in history killing many and wiping out property and decimating communities. Michael Jackson does his last moon-walk and Tiger Woods is revealed to be not so perfect after all. The Copenhagen Summit on global warming identified agreement on cooperative actions to address the key issues and limit global warming to 2 degrees.

As the dawn of the next decade descends on us we see glimmers of hope and an end to the fallout from a decade of reckoning. Unemployment is easing, markets are heading north, the Y generation has just been taught a valuable lesson (you reap what you sow), Obama is making positive change, Copenhagen has set a firm agenda to address global warming, we are now fighting the war in the right locations, organic food is here to stay, alternative energy is gaining momentum, money is more tightly regulated, social networking has displaced power from corporate to individual, and we have all been made aware, more than ever, that we are all part of a global community and each action, whether positive or negative, can have a dramatic affect on all of us.

 My predictions for 2010 are based on current market based sentiment around the confidence in the global economy and BPO industry trends in the region. Firstly, if we look at the current state of the economy we could reasonably argue that we are due for a strong re-bound in 2010. This prediction is based on historical similarities with other downturns at the time when market confidence swings from negative to positive (1999, 2003). The question is whether the upturn will be a U, V or J curve. BPO providers in the region have been/will be affected by the consolidation in the industry. In 2009 we saw UCMS acquired by Aegis, Xerox acquired ACS, Sykes acquired ICT, Dell acquired Perot Systems, and high debt and poor timing bankrupted Blueprint Management Group. Huddling together during a crisis is a normal market response. The consolidation amongst the big players will force smaller BPOs to re-position their offerings or face slow but certain extinction. Whenever the playing field changes so do the rules that bind the game. 2010 will present great opportunities for smaller players that can take the courageous path of re-inventing themselves to take advantage of the opportunities presented in 2010.

 In previous years the APAC region has reaped the rewards of its ability to service primarily the US, UK and Australian marketplaces because of its low cost advantage and access to large English speaking resources. The companies that made the decisions to outsource to the region have more than a 10 year history to determine what worked and what could be done better. The region has matured significantly but it is not without its problems: rising costs, operational inefficiencies and competing markets. Markets such as Egypt are emerging as real threats to the region. The region has a lead but is in danger of losing its sustainable competitive advantage if it does not address some of the issues it faces and reinvent itself to ensure it is as attractive as when it identified its first strong sustainable value proposition. I am still surprised by the number of solicitations I receive from providers claiming that they can help reduce my costs and therefore I should send them work to India or the Philippines. The lower cost value proposition has simply been done to death. The region needs to become more entrepreneurial and creative in its offerings. It also has to import leadership from the markets its services to overcome the knowledge and experience gap.

 So where will the opportunities in 2010 be for the region? The opportunities lie in becoming more specialised in what is offered to the marketplace. In 2010 providers should, as a minimum, have the following: 

• A clearly defined area of specialisation
• SIP based telephony
• Self-service technologies
• Back-office platforms
• Creative operational models incorporating home agents
• A robust sales engine capable of attracting clients
• A well-structured service delivery model

 Reports from CallCentres.net, Everest Group, XMG Global and Research and Markets all indicate that 2010 will offer varying levels of growth for the various sectors in the BPO industry. My summary predictions for the region are as follows: 

1. India: further consolidation and reduction in the number of BPO providers. Strong demand for non-voice outsourcing and steady to declining demand for voice. Largest market US.
2. Philippines: strong demand for voice (non-sales) and also back-office outsourcing.  Largest market US but Australia and the UK increasing in 2010. Watch out for exchange rate head winds.
3. China: growing interest in the BPO sector. Companies seeking partners to enter China.
4. Japan: reduced demand for voice BPO and greater demand for self-service technologies.
5. South Korea: increasing demand for voice and non-voice BPO from local providers.
6. Pacific Islands: minimal growth in voice and non-voice BPO
7. Australia: strong demand for specialist voice providers and self-service, especially with sales expertise. Strong demand for offshore back-office and low value voice BPO.

Whatever sector of BPO you may be in there is a strong prediction that if you work hard, remain persistent and surround yourself with good people you will succeed in 2010. Many people in the industry deserve a much better year in 2010 than they had in 2009. Wishing all practitioners a prosperous 2010.

The paper is available for download from the research section of our site.

http://www.streetsmartcc.com/DownloadableContentHandler.ashx?mediaId=dea268a5-ad53-4f64-b66b-d2f4693b4ed8

1. Breach of duty of care and diligence by director or officer (sec 180(1)).
2. Breach of the duty to act in good faith (sec. 181 (1))
3. Failure to keep accurate minutes in a timely manner (sec 251A (1) (6)) 

There are numerous lessons learnt from the James Hardie case. The ones that stand out are: 

1. The directors’ duty of care cannot be delegated to co-directors, management or expert advice.
2. Directors cannot rely on management’s advice in place of their own consideration of an issue which is within the board’s responsibilities.
3. Directors should formally object if the issued board minutes do not reflect what accurately took place in the board meeting.
4. Directors should not vote to pass a resolution unless they have properly reviewed and understood the terms of the resolution. 

One of the clear themes that came from the briefing was how vulnerable company directors have become. The James Hardie case serves only as a warning to practicing company directors. The issue is that there are more than 600 state and territory laws in Australia imposing personal liability in individual directors and officers for corporate misconduct. Gabrielle Upton, Legal Counsel at AICD, highlighted key findings from a survey of 600 directors from ASX-200 listed companies. The results of the survey showed that 78% of respondents considered there was a medium to high risk of being personally liable for decisions they or their boards made in good faith. Similarly, 78% believed that the risk of personal liability had caused them, or their board on which they sat, to occasionally or frequently take an overly cautious approach to business decision-making. The survey also highlighted the negative impact of personal liability on board retention and recruitment: 

• 71% of respondents had declined the offer of a company directorship because of the risk of personal liability
• 75% knew of other people who had resigned from a company directorship because of the risk of personal liability.  

These responses come from experienced board directors of public listed companies. What hope does the small business company director have a private company? The Corporations Act 2001 does not make special allowances for the size of the company. Small business owners are often poorly informed about the extent of personal liability imposed as company directors. Many of these companies are comprised of a small number of directors and are often governed more as a partnership than under a formal company board. Their legal structure, often advised by the tax accountant, is a corporation. The company constitutions are often never tailored to reflect the true decision-making processes of the partners. The tax accountant is likely to purchase a template from a legal ‘vending’ machine instead of customising the constitution. Where does this leave the small business director? 

From my own research it leaves the company directors of a small business terribly exposed and ill-informed. I would like to see a survey undertaken of small business company directors to test their knowledge regarding key aspects of the Corporations Act 2001 and see the results. It would not be a surprise to many of us if a large number would fail this basic knowledge test. The courts have demonstrated that ignorance, feigned or otherwise, is no defence in a legal case. Small business directors are often confronted with different issues to those of directors of public listed companies. These issues are often related to the lack of preparedness in governing the company under a proper board of directors. For instance I know of a number of company directors in small businesses who have been entangled in expensive oppression litigation under sections 232 and 233 of the Corporations Act. Oppression cases are more common than most people realise and are almost always related to shareholder and director disputes of private companies.

 The James Hardie case serves as a timely reminder for directors of private and public companies that as a director you are personally exposed. Pleading ignorance on the issues will not absolve you of any wrongdoing. The message is clear: if you are a director, then ensure you know the Law well; ensure you know what processes you need to follow if you are asked to make a decision at board level; and ensure you take total ownership for your decision-making.