Our digital age is transforming our world in unprecedented ways. Investment and innovation in technology is providing access to new populations and new services never before possible. While this directly enriches communities around the world, established markets are also witnessing how they benefit from a more connected planet.
The impact sourcing industry is a glowing example of what technology is making possible. Impact sourcing is a subsector of the business process outsourcing (BPO) industry that focuses on addressing social issues and employing those from disadvantaged backgrounds.
Over the last few years, this nascent sector is showing how technology can benefit both downstream communities and upstream customers. Companies like Impact Enterprises in Zambia are the first of their kind to establish themselves in new developing markets.
A report by Accenture projected that by 2015, the global BPO market will have grown by $45 billion, to $211 billion in total revenue. The impact sourcing subsector will account for 11% of that market – a 29% projected annual growth rate. Already, impact sourcing employs 240,000 workers worldwide. That makes up 12% of the entire BPO market.
Even more interesting, 39% of those workers are in Africa, a continent not known for its tech sector. These figures demonstrate how quickly impact sourcing is being adopted in new exciting markets.
Beyond just the outsourcing providers, a symbiotic ecosystem has emerged between universities, vocational training centers, corporations, governments, and foundations. This means that youth are receiving better, more focused training; corporations are demanding impact sourcing services; governments are incentivizing job creation; and foundations are fostering a dialogue and raising awareness globally.
Better value over traditional BPO
While the essence of impact sourcing may seem primarily altruistic, impact sourcing has incredible business advantages. Compared to traditional BPO services, impact sourcing has demonstrated added value of 4-6% in South Africa, 10-15% in Kenya, and as much as 35-40% in India. This means that compared to onshore solutions in the U.S. and U.K., impact sourcing saves as much as 65-87%.
This value proposition emerges due to operations moving to Tier 2 and 3 locations and access to a previously untouched pool of candidates. Impact Enterprises operates in Eastern Zambia, the only technology company in the region. Whereas infrastructure and logistical obstacles previously made operating in these conditions impossible, the rapid and unstoppable spread of information and communication technology has opened new frontiers.
New large pool of talent
By reaching out to a new demographic of candidates, impact sourcing is able to offer a new pool of talent for customers. New providers in Africa, a continent previously void of BPO, can now offer reliable outsourcing services that would otherwise be serviced in Asia. This local talent is knowledgeable in domestic languages and cultural norms. Keeping the service on the same continent and same time zones also means more compatible service schedules.
Overall, this is providing a higher level of quality and direct access to clients otherwise impossible to reach. During a November event hosted by the Rockefeller Foundation, Microsoft stressed its new focus on customer service for its ubiquitous products. This requires adopting a massive support workforce, which can be found with impact sourcing providers.
Lower employee attrition
The outsourcing industry is notorious for employee turnover, with some estimates showing the average BPO employee tenure of just 12 months. The impact sourcing sector, however, has 15-40% lower attrition rates. This means employees stay longer, gain specialization in their service, and provide superior support. Employees also demonstrate strong engagement with their new company.
At Impact Enterprises, 86% of employees said they “identify with Impact Enterprises.” After 19 months of operation, 51% of our employees had been with the company longer than 9 months. By employing a previously untouched demographic of ambitious workers, impact sourcing is proving its commitment to new communities.
Impact sourcing, while still a nascent industry, has already demonstrated an impressive impact on the communities it serves. Globally, employees report an increased income of 40-200%. At Impact Enterprises alone, 78% of our employees support others financially. 62% are saving a portion of their salary, of which 74% is going towards higher learning.
The benefits of this new industry go beyond financial gain. 84% of our employees say they have learned new skills, while 92% said their experience will help them get a new job in the future. The promise of the impact sourcing sector is also in its scalability, where countries can diversify away from capital intensive industries like mining and manufacturing.
Proven, reliable results
Best of all, over the last 5 years impact sourcing has proven just as reliable as traditional BPO. Performance, for both voice-based services like call support and non-voiced services like data management, has been shown to be comparable in terms of quality and turnaround time. Large corporations, like Microsoft, Deloitte, HP, and Standard Bank, have already embraced the promise of impact sourcing.
Impact sourcing service providers are wielding the incredible promise of the digital age to benefit all levels of stakeholders. The value of their service goes beyond the altruistic and provides opportunities for businesses to utilize the talent at all levels of the social pyramid.