Nearshore Americas
stress test

The Nearshore Comes Face to Face with a Consequential Stress Test

A major test is underway to determine just how well the Nearshore services community will respond to sudden workforce disruptions, unstable customers, emotional turmoil, and local operational surprises that will undoubtedly surface as the fearsome novel coronavirus (COVID-19) grows in intensity. This week’s special report on the global pandemic provides a glimpse into how some leading providers are adapting to this stress test.

There are elements of this particular crisis that are likely to lay bare a range of strengths and weaknesses in the way Nearshore businesses operate. Companies are soon to gain real-time feedback on the quality of their business continuity planning. Informed and communication-heavy leadership will significantly influence business sustainability. Levels of trust with customers will be magnified. Customers will want more exact measures of accountability. Entire organizations and ecosystems will endure emotional ups and downs that will undoubtedly impact productivity. And, as the crisis starts to diminish, the competitive positioning of companies and countries will rise or fall depending on how well they have managed the storm and made prudent course corrections.

Variables and vulnerabilities

The coronavirus is fast-moving and unpredictable. For many leaders, now is the time to be focused on what elements of the situation can be managed and the steps that can be taken to prepare for potentially worsening conditions. Key factors to be thinking about include:

Broadband access at home: The likelihood of sending employees home to do work is rising by the day. From a general perspective, the IT-specific side of the Nearshore industry has been utilizing work-at-home options more broadly for the past five or six years. The practice is just starting to gain some momentum among call centers, but that opportunity has several limiting factors. The willingness of Nearshore BPO customers to permit work-at-home has not been traditionally strong. However, the coronavirus pandemic is starting to change the calculus – the number of clients inquiring about WAHA policies and options has spiked in recent weeks. Some clients have asked about bringing Nearshore workers into the United States to fill empty seats. Another significant factor, of course, is the availability of broadband-quality internet connections in the homes of workers. Although around 50% of homes in the Latin America/ Caribbean region have broadband, it is estimated that a much larger share of connections exists in the homes of Nearshore industry workers. The stability and reliability of those connections will be one of the essential items managers will need to evaluate in the coming days.

The common sense around social distancing: One of the more alarming realities of the coronavirus is that social distancing has been demonstrated to have a material difference in limiting the spread of the virus. This presents a unique stress test for the Nearshore. Is it possible for Latin American and Caribbean citizens to ‘pull-back’ and remove themselves from opportunities to make physical contact with friends, co-workers, colleagues, and so on? As hard as this stress test sounds, the leaders of Nearshore businesses need to look squarely at the data that demonstrates the ferocity of the coronavirus and heed the advice of scientists and health experts. Enacting work policies that require social distancing is a start. Another step is for company leaders to actually ‘walk the walk’ and demonstrate how to behave in a way that reduces the risk of exposure. These are simple, common-sense steps that should be followed immediately.

Economic disruption: Global markets are in a state of profound turmoil. We can and should expect this turmoil to not only destabilize the obvious industries of travel and leisure, tourism, and retail but also bring some amount of paralysis to industries one might consider ‘safe.’ This paralysis is likely to manifest into the traditional areas of sourcing and procurement that are the common portals through which Nearshore business is transacted. Until the pandemic reaches a point of being manageable, expect many of your clients to lack both clarity and certainty.

Remember the DNA of the Nearshore model: Process discipline. Managing remote relationships. Working in highly collaborative, virtual environments. These are the main hallmarks of the Nearshore business model that will continue to take on outsized significance throughout the crisis. In a sense, the Nearshore business has been training for years to obtain the proper level of preparedness to adapt to this stress test. Putting that training to work, knowing what steps need to be taken, and communicating to clients in a clear, confident manner will make a major difference in maintaining continuity.

Local disruptions: Is this the ultimate ‘Achilles heel’ of the Nearshore model? Societal stability is the underpinning necessary to allow operators to run business as usual. Where this crisis goes and what social, political, and humanitarian challenges lay ahead are very difficult to forecast. What is clear is that Nearshore businesses need assurance that they can continue to operate without interference. This is certainly one of those times operators should be turning to their local or regional industry alliance bodies to speak in one strong, singular voice about their business continuity expectations. Alliances matter – as we pointed out some months ago – and now is the opportune moment to stand in alignment with your industry peers.

Sign up for our Nearshore Americas newsletter:

Communicative and proactive leadership: The love that business owners and operators have for the people they employ across the region is vast and impossible to calculate. One of the most responsible ways to demonstrate that love is to stay closely engaged with your people. Act in their best interests. Enact policies that look to protect the health of those workers and their families. Be sure that the information you obtain is reliable and current.

The role of Nearshore Americas: Supporting the organizations that work in the Nearshore market is of paramount importance to us. We are available to assist in obtaining useful information, making industry connections, and using this platform to highlight activity by governmental or political bodies that run counter to protecting the well-being of your people. Although much of this article is focused on the business aspects of the coronavirus crisis, we are deeply mindful that as each day passes, the level of anxiety and concern rises among us all. Our prayers are with you, and we stand ready to assist and support.

Kirk Laughlin

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

Add comment