Outsourcing for Social Good: A BPO Perspective · Outsourcing for Social Good: A BPO Perspective ... KPIs and targets? ... Outsourcing for Social Good: A BPO Perspective

© 2013 TELUS International telusinternational.com | @TELUSint

Outsourcing for Social Good: A BPO Perspective

Insight Paper

When it comes to corporate social responsibility (CSR), is there a new imperative for BPOs? Global

BPO provider, TELUS International, in partnership with global CSR consultancy, Impakt Corporation,

explore the rising social purpose of the outsourcing industry.

Learn more at: http://telusinternational.com | http://impaktcorp.com

http://telusinternational.com/

http://impaktcorp.com/


© 2013 TELUS International 2

Idea in Brief

The Business Process Outsourcing (BPO) industry was born out of a desire to cut

operating costs. However, the industry is changing considerably. Today, progressive

BPOs are focused on creating an exceptional customer experience while delivering top-

line value to their clients in a way that also addresses social inequities in the countries

where they operate. At the same time, clients are evaluating BPO suppliers on more

than the conventional value proposition. Clients have come to recognize that

Corporate Social Responsibility (CSR) is a vital way to assess the values of a company.

By responsibly and ethically employing hundreds of thousands of people, BPOs have a

role to play in shifting the social landscape in emerging economies around the world.

A crucial next step is to develop more robust techniques for measuring both societal

and business impacts of CSR initiatives, including reduced agent attrition, better

customer satisfaction, and improved public opinion.

The Need for Social Change

The need for social change is as urgent today as at any time in history. About 1

billion people around the globe will go to bed hungry tonight, 200 million of them

children. According to USAID, nearly 800 million people lack dependable access to

clean water, and about 2.5 billion people lack access to modern sanitation1.

Until recently, addressing these critically important social issues has been the sole

responsibility of governments and non-governmental organizations (NGOs). Despite

the best efforts of civil society, the social conditions for too many people around the

world remain unacceptable. As government programs and services are being cut and

NGOs struggle to stay afloat, society’s expectation of business has changed. Milton

Friedman’s belief that the responsibility of business to maximize profits is being

challenged and the question of what constitutes business value is being re-

examined.

How can businesses align short-term business goals with long-term social

objectives? What is the business value of social change and the social value of

business performance?

A new model is emerging that touches every aspect of a company's operations. It is

embodied in a term coined by Michael E. Porter and Mark R. Kramer in their 2011

Harvard Business Review article "Creating Shared Value". Instead of relying on

altruism or optics to drive corporate social responsibility, the concept is based on

1 http://www.usaid.gov/what-we-do/water-and-sanitation



"reconceiving the intersection between society and corporate performance." By

aligning corporate success with social progress, new products, services and

approaches are developed that bolster a company's long-term profitability, while

also addressing major social issues.

As the world's largest purchaser of black tea, Unilever supports social change

through its Better Livelihoods program. It has already trained about 450,000

smallholder tea farmers in sustainable agricultural practices and made high

quality seeds and fertilizers available to them. Farmers have improved their

yield and their livelihood, while the company has a more robust supply chain

focused on smallholders.

Nestlé has also developed a new sourcing practice for its highly popular

Nespresso coffee brand. Most coffee beans used for specialty coffees are

sourced through small farmers in Africa and Latin America whose production

is limited by a lack of resources. To overcome this problem, Nestlé has

provided advice, financial assistance and agricultural inputs, while also

building local processing facilities. This has increased yields, while also

providing Nestlé with a more secure source for their coffee.

Google.org is leveraging its robust mapping technology for the public good,

providing everything from crisis response information to flu and dengue

trends. These actions are helping the world tackle some of its most daunting

challenges.

Clearly, progressive companies are already making social change a core pillar of

their business. How does this approach apply to the Business Process Outsourcing

(BPO) industry?

BPO: An Industry with a Social Purpose

The BPO industry was born out of a desire to cut operating costs. However, the

industry is changing considerably. Today, progressive BPOs are focused on creating

an exceptional customer experience while delivering top-line value to their clients in

a way that also addresses social inequities in the countries where they operate.

TELUS International was interested in producing a balanced and objective analysis

of the reasons why corporate social responsibility (CSR) is becoming so important to

the BPO industry. Impakt Corporation, a leading global CSR consultancy, was sought

out by TELUS International to explore this question.

The research revealed that BPOs have become connected to and rooted in their

communities in a way that is inextricably linked to the success of their businesses.



By responsibly and ethically employing hundreds of thousands of people, BPOs are

shifting the social landscape in developing countries around the world, while the

industry is recognizing that success can no longer be defined by bottom-line

concerns alone.

“A lot of business leaders look at their business and ask: what are our

strategic objectives? What are our financial metrics, KPIs and targets?

What are the core competencies and skills required within the

organization? And then, in an unrelated secondary conversation, they

may talk about culture, values and CSR. It’s viewed as an addendum to

the central discussion of the business, not part of the fundamental,

strategic discussion about the business. For us, it’s an inclusive

conversation.”

- Marilyn Tyfting, Vice-President, Human Resources,

TELUS International

A New Imperative for the BPO Industry

Success in the industry can no longer be measured strictly by costs per call or

number of seats in a call center. Limitations of the original BPO business model have

led to high attrition rates among call center agents, with annual turnover rates in

some locations exceeding 80 percent. This has many consequences. For the

companies the BPOs represent, high attrition rates can translate into a gradual

diminishing of customer satisfaction as brand continuity is minimized and agent

dissatisfaction interferes with the customer relationship.

The DNA of the emerging model for the BPO industry is based on the value of a

caring culture. When a company thoughtfully analyzes the social issues its

employees and communities are facing, and then develops effective strategies to

address these problems, the company, its employees and communities all benefit.

And when people feel valued and cared for, they become more loyal and enthusiastic

about the organization they are working for.

A key imperative for the BPO industry stems from a persistent inability for

governments and non-governmental organizations to address basic social issues in

developing countries, such as housing, access to clean water and education.

This consciousness has spurred companies to think much more strategically in

forming ongoing partnerships with local communities and aligning shared values

and goals. It’s not a question of companies executing occasional, high-profile

philanthropic initiatives. It means embedding this ethic in the very way the company



conducts its business. This isn't being driven by altruism. It is an innovative and

sensible strategy for a new brand of business success for BPOs.

"In our opinion, our team members [agents] are the true difference –

how they feel, and how connected they are to the business. This

translates into providing passionate, caring customer experiences for

clients. It changes the ground rules so that traditional criteria and cost

savings alone become less important."

- Warren Tait, Vice-President, Culture, Philippines,

TELUS International

The Value of a Caring Culture

Helping communities address basics like housing, education and clean water,

enhances a company's reputation. It becomes a sought-after place to work, making

recruitment that much easier. Retention increases substantially. Agents are engaged

as they feel they are making a real contribution to their families and communities

through their employer.

For BPOs, success isn't measured exclusively by the balance sheet anymore – it’s

also based on seeing the changing reality of communities.

In creating thousands of well-paid jobs, the stability of the community is improved.

People no longer have to leave their home country and family behind to earn a

living. Instead they can build a more prosperous life and community right where

they live. A wider range of opportunities becomes available. The middle class

expands. All of these factors have the potential and ability to transform society in a

profound way. This is not a pipe dream – it's a snapshot of what is happening in

places as diverse as the Philippines and El Salvador.

"Many BPO companies stop at corporate charity. They make the poor

objects of charity. I think TELUS understands sustainability and

solidarity. It's about empowering the poor to help themselves and one

another. It’s about building a permanent impact – schools, water

systems and toilets have an impact, not just on the health, and the body,

but on the soul. So it is this spirit that TELUS brings – the spirit of

solidarity and sustainability, of honor and self-respect."

– Tony Meloto, Founder of Gawad Kalinga (NGO in the Philippines)



“We are helping to create the future leaders of our country; people

focused on social consciousness and solidarity. They are able to go

from surviving, to dreaming.”

- Guillermo Valiente, El Salvador Country Manager,

TELUS International

CSR: The Next Important BPO Benchmark Increasingly, clients are evaluating prospective BPO suppliers based on more than

the conventional value proposition. They have come to recognize that CSR is a vital

way to assess the values of a company: how integrated it is in the community, how

committed it is to nurturing an environment that cares about its agents, and how

much it cares about customer satisfaction.

However, assessing the precise value of qualitative outcomes remains a work in

progress, and there is no one-size-fits-all approach that will work for BPOs in all

countries. The key to success is making every effort to understand the social issues

that matter most at the local level, adapting programs to best address these issues,

and doing so in ways that reflect each company's values, strengths and expertise.

"What TELUS has done is enable individuals to show up and do what

they’ve always wanted to do – to feel a connection and make a

difference. The return is loyalty and passion for the business and

compassion for the community. It becomes an ecosystem and lifestyle

that is community-based that people thrive in.”

- Kevin Bottoms, Account Executive, TELUS International

What are BPOs doing?

TELUS International (TI) has instituted its Day of Giving in several countries,

including the Philippines and across Central America. In the latest Day of

Giving in the Philippines, TI mobilized 2,000 of its international team

members to refurbish the EMS Signal Village Elementary School in Taguig (a

single school attended by 9,000 children) – in conjunction with a new

partner organization, Hands on Manila.

Beyond single day activities, TI is dedicated to creating ongoing, long-lasting

partnerships with their CSR partners, matching team members’ dedication

to volunteerism with charitable organizations that need support. During the

past five years, through a partnership with Gawad Kalinga (GK), TI has

helped create two villages and built 149 homes in the Philippines. Team

members also volunteer at the villages every few weeks, teaching life skills,



tutoring children, and empowering previously homeless people to take

control of their lives.

In a similar model, Convergys uses its Community Action Network (CAN) to

promote everything from education to feeding the hungry and sheltering the

homeless. CAN combines volunteer hours, in-kind donations and direct

financial contributions to perform its work.

In Central America, TI focuses on youth and education, building schools from

the ground up, assisting more than 4,000 children. In addition, TI agents in

Guatemala put their skills to good use volunteering time running anti-drug

and HIV information hotlines.

TELUS International has also taken CSR several steps further. Three TELUS

International community boards located in the Philippines, El Salvador and

Guatemala, each distribute $100,000 annually to local grass-roots charitable

organizations. The boards are run by local community leaders, as well as

TELUS team members. The most unique feature is that local community

leaders, not TELUS International, determine where funds will be most

impactful in the community.

Another program that has made a significant impact is TELUS International

University (TIU) – it helps employees earn a degree right onsite in their

workplace, improving their prospects without having to leave their jobs.

Another BPO company, Teleperformance, has also created centers for

learning – TP University. It gives the company’s most promising executives

personalized college courses that immerse them in the company's best

practices and innovative approaches to customer relationships and the

customer experience.

Sykes has created a series of programs as part of its Global Giveback effort

that supports everything from local clinical health services to physical

fitness. Sykes Cares represents the company’s main philanthropy program

aimed at raising education levels in the Philippines by providing educational

facilities and equipment.

There are several other examples from large scale programs to individual

stories of giving. But overall, there’s a real opportunity for BPOs to embrace

this new imperative around both customer experience and social change.



A Sense of Direction: Where Does the Industry Go From Here? While several BPOs have begun to derive significant returns from their social

purpose initiatives, many companies still approach non-financial aspects of business

in a mostly ad hoc manner. The industry is just beginning to approach community

challenges in a more systemic way.

Finding the right balance in how to communicate social purpose efforts also remains

a challenge. Corporations recognize a degree of risk from being seen as blowing

their own horn too loudly. Yet, business results and social outcomes depend on

drawing more attention to non-traditional initiatives. And since clients increasingly

look at CSR as a differentiator in their business and their choice of suppliers, it has

become more important than ever to spread the word.

Research conducted in support of this paper has revealed a number of other

interrelated questions that the industry should address moving forward. Most

importantly, what are the best tools and metrics BPOs can use to quantify the

results of a CSR program?

Other key questions include:

How can companies in this industry align their social purpose initiatives to better reflect their corporate values and existing areas of expertise? How does a more targeted alignment translate into a better customer experience?

Is there a way of more formally integrating BPOs and clients in the

development of shared CSR endeavors?

What criteria could be established so that BPOs can better determine how best to serve community interests?

Can social investment practices be standardized and applied in different

regions across a network of corporate operations?

How can BPO companies measure and improve their partnerships with local NGOs?



Taking the Next Step Companies are good at growing their businesses; they are not created with the

intention of acting as direct aid providers.

Although it’s flattering to be mistaken as doing the work of Canada’s primary

international aid agency, TELUS International recognizes that its role is not to

deliver aid. Rather, it's to develop long-term partnerships with the most effective aid

agencies in the countries where it operates. It's to form community boards with

local leaders to steer the company to the social issues and solutions that will work

best in each region. It's building a social purpose from the ground up, instead of

imposing one from the top down.

"Canadian companies in the Philippines, including TELUS International,

are leaving a legacy for society. They are helping people belong to

something bigger than themselves. This creates voices for real

transformation.”

- Christopher Thornley, former Canadian Ambassador to

the Philippines

A crucial next step in the process is developing more robust techniques for

measuring both societal and business impacts of CSR initiatives. For now, though,

the positive impact on TELUS International’s corporate culture is clear:

"It really is remarkable how infectious this whole CSR philosophy is

when you do it right. It can come across as hollow and disingenuous

when it's being produced as a sound-bite or photo opportunity. When

it’s part of our DNA, and a pillar of corporate culture, it provides a

jumpstart to the business. It creates common language for all of us to

rally around – it’s the glue of our organization, considering how

disparate and diverse the business really is."

- Jeffrey Puritt, President, TELUS International

This paper is the first formal analysis of the relationship between social purpose and

business performance in the BPO industry. But it is only a starting point. TELUS

International will continue to explore the relationship between community

involvement and social purpose, and its impact on better business performance. The

objective is to advance the interests of the BPO industry and its clients in ways that

also create meaningful social change.



For more information:

TELUS International

TELUS International is a global provider of contact center outsourcing solutions. With locations

throughout North America, Central America, Asia and Europe, TELUS International drives value by

enabling customer experience innovation through spirited teamwork, agile thinking, and a caring

culture that puts customer first. Learn more: http://telusinternational.com

Impakt Corporation

Founded in 2001, Impakt helps corporations and not-for-profit organizations become social

purpose leaders by assessing, improving and measuring the value of social investments and social

programs. Learn more: http://impaktcorp.com

COPYRIGHT NOTICE © 2013 TELUS International. Other company and brand, product and service names are for identification purposes only and may be trademarks or registered trademarks of their respective holders. Reproduction without permission is forbidden.

http://telusinternational.com/

http://impaktcorp.com/

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Outsourcing for Social Good: A BPO Perspective · Outsourcing for Social Good: A BPO Perspective ... KPIs and targets? ... Outsourcing for Social Good: A BPO Perspective