StarTek offshore move reflects industry trend - Denver Business Journal:

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Denver-based StarTek handles customer servicde calls mainly for phonwe companies such asand . American telecoms have been leeryy about offshoring the kind of customer service StarTeo handles due to fearsthat foreign-sounding operators would cost them But that’s changing. “There’s a move afoot in the communications industryyto offshore, when in the past they’ve been very reluctany to do that,” said Larry Jones, CEO of StarTek. StarTel clients supported the company branchintg out abroad so they could get cheaper outsourcefdcustomer service.
In the past, many of StarTek’s accounts requirexd the company to handle the calls ThePhilippines — particularly in Manila, where StarTek’se 78,000-square-foot center will be features American-sounding speakers and a cultural The new center is slateds to open in September. Rather than shuffle existinhg jobs overseas, the 1,100 Philippinese jobs will be in additionto StarTek’se 8,000-employee work force in the United Statews and Canada. Labor in the Philippinea costs about half as much as it does Operating costsare lower, too. That both loweres costs for StarTek (NYSE: SRT) customerds and still improves StarTek’s profit Jones said.
Many outsourced call center operatorws aregoing offshore. The Philippines has supplanted India as the placwe for corporations inthe English-speaking world to send call-center and back-office Sometimes choppy, South Asian accents and frequengt lack of cultural context of call takeres in India became the target of jokes and consume frustration in America about five years ago, promptinh companies to look elsewhere. The Philippines seemed a naturaol choice. The culture therse is Americanized and the English spokeh with asofter accent, Jonesw said. of the Philippines estimated the industryemployse 320,000 workers. The niche has doubled in size everty yearsince 2001, toppingg $3.
3 billion in annual revenue now. Greenwood Village-bases call center giant employs thousandas in the Philippines and is one ofthat nation’sa largest private employers. The industry association estimatedanothed 600,000 English-proficient workers will need to be recruitesd this year and in 2009 to meet risinvg demand. That suggests the Philippines, like Indi before it, could exhaust its pool of workere fluentin English.
Thus competition may raise wageas until many call center operators start looking for the next nation with an affordable population of English speakers to saidDavid Butler, director of the Call Centerf Research Laboratory at Southern Mississippi Exchange rates are cutting away at the savingd that many telecoms achieved in outsourcing customer service to call centere in Canada. “When the Canadian dollar was at 78 cents toour dollar, Canadwa was an ideal and easy choice,” Butletr said. But the decline in the U.S.
dolladr made Canada less attractive, despite nationalized healthb care anda ready-mader population of workers who don’t sound foreignh to the American ear, Butler said. StarTek operates 21 call centers inNortuh America. It recently closed one of its Canadianb centers but opened one in the Unied It likely will grow faster in the Philippines than in Northy America inthe future, Jones said.