Nearshore Americas has learned that global contact center giant Convergys, which serves half of the Fortune 50, is setting up a BPO  service center  in Bogota after receiving clearance to operate in a new free trade zone in the northern part of Bogota.

As many as 2,500 seats will occupied at the center within three years, according to two reliable sources. The center, which should be operational in June, will also offer financial back-office support services.

Colombia is without question one of the hottest outsourcing destinations in Latin America, and its transformation has been one of the biggest stories to hit the headlines in the Nearshore community in the last several months.

Convergys spokesperson John Pratt declined to comment late today on our report.

“This does not come as a surprise, really,” says lead BPO and call center analyst Peter Ryan, of DataMonitor, commenting on the development. “There is a lot of capacity in Colombia and the country has the potential to become the next big thing in South America,” said Ryan, comparing its rise to Chile and Argentina, which have become globally recognized outsourcing centers.

Pace of Growth: A Critical Question

Another major global BPO player to jump into the Colombian market is Teleperformance, which recently acquired Teledatos, which generated about $75 million in 2009. Teledatos operates six delivery centers in Bogotá and Medellín, employing over 5,000 workers.

The big question facing Colombia over the near term is whether BPO growth will come as a deluge or grow incrementally. If there is a huge spike in demand for call center services, for example, Ryan says this could trigger inflationary wages pressures. “It would be better if the growth is spread  over the next 24 months,” he says.

The other question confronting the growing Colombia BPO sector  is whether cities such as Medellin and Cartegna will be able to produce sufficient quantities of bi-lingual workers, says Ryan.

Convergys Retrofits

Convergys recently downsized in Canada, cutting over 800 workers, and shuttling those positions reportedly to the Philippines. The Cincinnati-based company says it expects to hire at least six thousand employees this year in the Philippines. The company employs over 20,000 workers in 12 sites in the Philippines.

Finally, Convergys also landed recently in Gartner’s Magic Quandrant, recognized for its service delivery in the CRM/Contact Center space.

“We believe that Convergys’ position in the Leaders quadrant for CRM Contact Center BPO providers is a positive validation of our leadership, execution abilities, and investments in our customer solutions portfolio.  Our solutions, which include agent-assisted care, automation, self-service, and analytic services, enable our clients to stand ahead of their competitors based on the quality and consistency of the customer experiences we help them provide, and the customer intelligence we bring to them.” said Andrea Ayers, President, Customer Management, Convergys.

Congratulations. You’ve survived 2009, the most challenging year for business since the Great Depression. DMG expects 2010 to be a better year, and the economic indicators show that the recession has bottomed out, but we don’t expect significant improvement for contact centers until Q4 2010. This is because, unfortunately, most contact centers are still cost centers and therefore less likely to benefit from quick budget relief and incremental investment dollars. The profit centers will come first, as they should.

The continuing challenges in 2010 will present contact center managers with opportunities to offer assistance beyond their departmental borders to sales, marketing and other operating areas. (Contact centers are positioned to help these groups with deep insights into customer needs, wants and issues.) The need to achieve corporate revenue, retention and cost savings goals will open doors. Contact center managers should find out what their corporation’s top five goals are for 2010 and create a business plan for their department that will help achieve those objectives. Contact center managers should reach out to their peers in sales, marketing and other operating groups and ask what they can do to assist them in achieving their goals. This will add new responsibilities to their already heavy work load, but with these responsibilities will come respect. Helping achieve company-wide objectives is a good way to establish a reputation as a team player.

While exact goals and priorities may vary among organizations, here are the top activities for contact center managers to concentrate on during 2010:

1. Generate revenue – ask the sales department to help establish sales goals for your organization. It’s important to be able to measure the contact center’s revenue contributions.
2. Retain customers – ask marketing for customer retention goals, along with the go-ahead to save customers at point of contact. Customer win-back programs are helpful, but it’s better and less costly to save customers before they cancel their accounts. Be sure to use measurable key performance indicators, so that you can take credit for your hard work.
3. Reduce operating costs – enhance your self-service solutions; ask agents and other operating groups about which tasks to automate. Reducing agent average handle time while improving service quality is important; it’s even better to proactively reduce low-value transaction volume.
4. Optimize your current operating environment – take a critical look at everything you do in the contact center (whether you have 25 or 20,000 agents) – all processes, systems, training, hiring practices, compensation, etc. – and identify opportunities for improvement. You are likely to find ways to reduce operating expenses by 10% to 20%. The goal of this initiative is to reduce your work load, not do more with less.
5. Identify new analytical applications that will support enterprise needs and pay for themselves in less than 6 months – start with speech analytics and desktop analytics, as they have a track record of making quantifiable contributions.

In addition to these efforts to improve efficiency and effectiveness, it’s time to fix some long-standing challenges. The contact center will never be on equal footing with its peers in sales and marketing as long as it remains a cost center. Strive to generate enough revenue to at least cover operating costs (whether $250,000 or $25 million). Work with senior management to convert to a profit center.

If your company does not have a corporate voice of the customer (VOC) program, work with marketing to establish one. If there is no customer analytics team, or even an individual dedicated to this function, get the budget (which will be easier if teamed up with marketing) and assign someone. If the contact center is still predominantly handling calls and emails and is not responding to SMS messages and social media, it’s time to enter the 21st century, or risk losing customers to competitors that are easier to do business with.

2010 is going to be another tough year for enterprises, but if you plan well and take some risks, you can come out of the year well ahead of where you started.