Nearshore Americas

IBM Commits to Another 1,000 Hires in Costa Rica, Dismissing Talk of a Labor Shortage

When IBM launched a BPO operations in Costa Rica in 2004, the firm was cautiously optimistic about its potential.  Over the last eight years, IBM has certainly shown that it has learned  its way around San Jose.  Carl Ingersoll (left), who has been Director of IBM Costa Rica for about a year, is now set to drive the operation ever further – hiring as many as 1,000 new employees over the next few years in an ambitious plan to ramp up exported services.

Qualified Staff – An Endangered Species?

With executives, industrial engineers, Finance and Accounting experts and call center agents, IBM is well staffed for its BPO services. “Hiring and recruiting needs a lot of focus,” says Ingersoll, “and we have a very focused recruiting effort. Attrition is a reality, but it is cyclical depending on what is going in in the market and it has been manageable.”

The new $300 million IT center, expected to start offering services by Q1 2012, will focus on infrastructure management, servers, networks, database administration, security and cloud computing. Clients may also want IBM to take over some or all of their internal IT functions. Ingersoll is confident that they will be able to fill the 1,000 positions by 2014 with Costa Rican personnel. “We have worked very closely with the President’s team not necessarily to get financing,” he says, “the incentive was to be able to negotiate support from standpoint of instructors, facilities and help in terms of building training programs so that graduates and professionals could acquire more IBM skills.” This is especially important for the new center. Fortunately, for them, IBM has the advantage of being able to get the attention of government officials, dedicated support of CINDE, the country’s investment agency, and has the capacity to create programs that a smaller firm would never be able to afford.

One area that is of growing concern is the issue of staff poaching. As demand for experienced and proficient employees grows, so does the likelihood that they will be actively courted by a competitor. Even though it is the smaller companies that need to be particularly concerned, IBM is also vulnerable, especially since it offers extensive training on high-level IBM methodologies and technology that could be of use to other companies.

Of course Ingersoll is aware of this risk, but, he told us, “We get those people back. What we try to sell is a career path; there are a lot of ways to move horizontally across the various towers, especially within the tech segment.”

“There is a supply/demand limit,” according to Mario Merino, General Manager at MapMemory Costa Rica S.A., and salaries for programmers are usually higher than other fields. Merino believes that IBM will be able to find enough people over time, “They are very well regarded here,” he says, “and a prestigious company to work for. Additionally, they can train internally and they hire aggressively.”

Merino also observes, “The IBMs of the world provide theoretical job security and a very structured work environment. Poaching happens as well, I’m aware of several companies that hire from a competitor frequently and the networks of friends that migrate to the competitor contact their former associates to go on to the new company.” Having to fill those positions with new staff can cause a myriad of problems such as added expense and a drag in production.

IBM is  vulnerable because it offers extensive training on high-level IBM methodologies and technologies that could be of use to competitors

English Matters

English language proficiency is something that is very important to educated Costa Ricans, and IBM has had very little difficulty with hiring enough bilingual talent. “We do English screening during the recruiting process and we are 80% to 90% bilingual,” Ingersoll reports. IBM can also offer English language immersion and training onsite, which is very beneficial to the staff. The President of Costa Rica, Laura Chincilla, has proven to be very committed to increasing her country’s English capabilities.

High schools and universities have implemented solid language programs and students are expected to graduate with strong English skills. Merino sees that the level of English fluency “varies from basic to advanced, and some native,” and “the nuance in technology and business vocabularies is left to those that have lived and done business in the US for some time. You can argue that the level is good enough to work on day-to-day operations, but won’t have the granularity of total immersion.” IBM’s BPO facility also services clients in Spanish, French and Portuguese.

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Getting Involved

This year IBM is celebrating its centennial and to mark the occasion they have developed service projects to assist in the less-developed areas of Costa Rica, pledging well over 1000 hours of employee time. One initiative brought 50 employees to region where they planted trees and conducted workshops with students. Other activities included cleaning beaches and building houses.

“We only have seven years here but have a lot of support,” says Ingersoll, “We are also really happy here because we have developed our business each year and have been strengthening our skills.”




Kirk Laughlin

Kirk Laughlin is an award-winning editor and subject expert in information technology and offshore BPO/ contact center strategies.

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