Egyptian outsourcing industry still confident of global custom

Leading Egyptian outsourcing and contact centre operators don't think Internet outages will impact customer confidence

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By  Mark Sutton Published  February 11, 2008

Egypt's contact centre industry remains bullish about its ability to attract global customers, despite service interruptions in the past two weeks.

The Egyptian call centre business, which Datamonitor predicts will employ 25,000 agents by 2010, suffered from disruption to international voice and data services, following the severing of two undersea cables off the coast of Egypt on 2nd February.

The cable breaks attracted widespread media attention, leading to concerns that the growing outsourcing industry, ranked number twelve worldwide by AT Kearney, would suffer a loss of confidence from international customers. But, according to operators, although there was some disruption to services, the incident actually proved the country's commitment to building a robust and credible outsource offering.

Khaled Shash, CEO of Raya Contact Centre Line of Business, commented: "The main issue multinationals want to see is how the country managed the problem, and I believe it was managed very actively. From day one, a committee was formed in the Ministry of Communications and Information Technology (MCIT), they bought bandwidth from different suppliers immediately and communicated with customers on the situation.

"They also announced a contract for a new cable, which shows that the country is keen for this business and shows that we know how to manage this problem," he added.

Raya has over 2,000 contact centre agents and 200 business process outsourcing (BPO) agents serving clients such as Dell, Microsoft and financial institutions across the region. The company had some disruption to voice services, although this lasted less than an hour, Shash said, as the company was able to reroute traffic using IVRs hosted in the UAE and the UK. BPO services were more badly affected by Internet outages, although service efficiency was back to 75-80% within two days, Shash said.

Egypt's largest outsourcer, Xceed, suffered more severe service disruptions as it was using Voice over IP solutions, said Ossama Nazmi VP marketing & business development at Xceed, although again the company had been very impressed by the MCIT's efforts handling of the situation.

Xceed was able to transfer two major clients, based in Europe and Canada, onto PSTN-based services within 24 hours, and then used the emergency internet bandwidth provided by MCIT, for serve customers as necessary. The company was able to restore 90% service, through shifting customers to PSTN, in under a week, he explained.

While both companies had suffered disruption, they did not expect that compensation would have to be paid to customers, as the outages would be covered by force majeure contract clauses covering events reasonably beyond the control of the involved parties.

Nazmi said that he doesn't believe the incident will have damaged the potential of the Egyptian outsourcing market.

"I really don't think this has damaged confidence, as it was very obvious that the situation was force majeure. Xceed already has a proven track record, and what was very good was that in managing the crisis, we got many compliments from our clients, which I believe will play well for us in the future," he said.

Ian Marriott, Research VP at Gartner said that the Egyptian market's small scale compared to outsourcing giants like India, had played in its favour, although it could impact potential customer decisions on outsourcing in future.

"The damage to the existing market in Egypt for overseas business, was not as bad as it could have been, as there is not a huge amount of business done there at the moment; the timing was probably OK for them, but it raises questions about business continuity and lack of plans," Marriott said.

"If you talk to the big Indian companies they have pretty good business continuity plans in place, in terms of shifting locations or staff. A lot of [outsourcing] businesses in India reported minimal impact, the business is well established, and they have been able to control the situation - that may move people to think they will go with an established market rather than go with emerging locations," he added.

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