Thursday, December 14, 2006

Outsourcing Business Processes to Africa

For those of you who have not known me long, you may not have known me long-but you do know that I am crazy about letting others know why they should be doing business in Africa. But people are imperfect, as I wholeheartedly admit that I am an example of human imperfection. It has occurred to me that sometimes in my zest for talking about Africa's business environments, I may tend to speak in a very general sense. But maybe if you have been on the receiving end of such a conversation, and you have said to yourself-"what type of business in Africa?" or "Africa, I thought that people only go there to help the needy".

Well, I am taking this opportunity to go a different route. Export oriented businesses in Africa are generally what I am referring to when I talk about doing business there. An industry that I am interested in learning more about is business process outsourcing.

Coincidentally, I just so happened to come across a website which relates to this very topic. After finding it, my next move was to learn more about the entrepreneur sharing this information. As fortune would have it, she is a business person from Kenya and I believe that her company is a poster child for both outsourcing to Africa and also for export-oriented African businesses. Because her story sort of fits into more than one category this is not the Profile format that I have used over the last several weeks. In essence, this is more like publicity for her company and the Africa's business outsource industry itself.

Mugure Mugo is the entrepreneur that I am referring to and her business is called Preciss Patrol. Her company provides online research for internet content developers. Though, I have never personally done business with Preciss Patrol, there is a US-based business person, James Bacon, who has. Here's what he says of doing business with PrecissPatrol of Kenya:

"We couldn’t shake hands over the Internet. I couldn’t even look her in the eye. But Mugure inspired confidence. Her command of written English was better than that of most Americans. She quickly grasped what I was looking for. And she stayed on top of things: She did everything she said she would, and she did it when she said she would. Despite the seven-hour time difference between Richmond and Nairobi, our extended work days overlapped by several hours. I thought things would work. We had a deal."
Courtesy of Bacon's Rebellion

Oh, I think that Miss Mugo gives a much better explanation of business outsourcing than I do. Here it is:

"Some of the services most commonly outsourced to developing countries include professional services such as:


*Construction engineering
*Customer support
*Internet research
*Software development
*Web site design and maintenance
Also popular are information processing services such as:
*Data capture and processing
*Translation services
*Transcription services such as legal and medical transcription
*Secretarial services
*Claims processing such as health insurance claims processing
*Mailing list management
*Text keying

Over the years, there has been a change in the type of work that developed-country firms have been willing to outsource. There has been a shift from outsourcing of clerical type work, to more skilled, professional type of services.

If charted on a scale, outsourced projects will usually fall within three categories:

  • Level 1 – routine clerical work, usually requiring only basic skills. This would include data processing and order taking.
  • Level 2 – technical work requiring some level of technical training such as call centers and other forms of customer support.
  • Level 3 - professional work requiring training and certification in a particular area such as market research, accounting, architecture and software development.

Why developing countries?
Reasons why US and European firms are increasingly partnering with firms in developing countries include the following:
Ability to obtain skilled labor for positions that would otherwise attract less qualified staff in developed countries. For instance, companies outsourcing their customer support function are able to obtain university-graduate-level staff in developed countries, who are usually willing to take on such assignments.

Lower labor costs. Contracting companies are able to obtain 30% – 40% cost savings as labor costs are considerably lower in developing countries.

Differences in time zones – this is especially important where 24 hour service is required by the contracting firm. A company in Africa or Asia, for instance, may take on work during hours when their US clients have closed for the day.
Improvements in some areas of developing economies have also led to their increased ability to attract work from abroad. Some of these include:

Improvements in telecommunications infrastructure – in Africa for instance, improvements in telecommunications infrastructure and other necessary services such as power and transportation have been key in enabling African firms source work from abroad

Improvements in educational standards – countries such as India and Kenya have a large population of well trained, English speaking professionals

Accessibility – improvements in air travel in many of these countries have encouraged foreign firms to outsource work to them. In some instances, contracting firms may require to visit locations where they have established working relationships with local firms.

It is now becoming clear that for many outsourcing firms, what began close to 25 years ago as a cost-cutting measure has evolved into an important way of achieving efficiency within the organization.

It is expected that in the next few years, the relationship between contracting firms in developed economies and firms in Asia, Africa, The Caribbean and Latin America will continue to evolve, and to foster partnerships that will be beneficial to both parties in the long run."
Courtesy of va newswire
If any of you are wondering if this post is sponsored it's not. I am recommending PrecissPatrol to anyone having online research needs simply because I believe in what Mugure Mugo is doing.

Of course, I love your comments. But, if you can't comment at this particular time- but would like to let us know that you were here; please sign and View my guestbook


Anonymous said...

interesting piece and interesting blog.

why do you call yourself "benin"?

Benin "Mwangi" said...

Thanks, I am glad that you find the piece interesting.

You asked a good question. Why do I call myself Benin? That is actually my birth name.

I have been told that it is unique and occasionally that it is the name of a country-that's what people from the states most commonly say.

Many times when someone from West Africa hears my name, they act sort of surprised and happy at the the same time. The reaction has been much different when I told someone from East Africa about my name.

Your question, I think, begs the question-why? Why would a person born in America be named "Benin". The answer is not very obvious so sorry if it's a little bit long. My desire to publicize business in Africa, for the most part is because of my experiences. But also, I have not said this before but my father probably desrves some credit also. He was interested in Africa since he was a child. One of his fascinations was and still is ancient Africa. Particularly, West Africa, and that's no slight to anyone from any other part of Africa. I think that this is probably because American's of African descent originate from West Africa. Anyhow, the Benin Empire fidings disproved the notion that Africa was devoid of City-Nation-States. The Benin Empire, if I am not mistaken, fourished from the 900's until the late 1800's. The Benin people were reknowned for vast trading networks extending across the West African region and when explorers from Portugal egan arriving in West Africa they marveled at the level of modernization in the city state. Bronze art was their largest export, next were iron, and ivory.
The empire began to decline during the time of the slave trade in the 1700's.

The remnants of the Benin Empire can be found today in modern day Nigeria. The place is Benin City in the Edo State of Nigeria. And my understanding is that the people that speak the Bini language are the unbroken line to the ancient kingdom.

I mention this for people who are not familiar with the history. Benin, the country, is on e of the places that I visited while my father and I lived in Ghana. Eventhough, the country that we call Benin, today, is not related to the Benin Empire everyone there whom I can recall, upon learning my name, almost fainted with
a happy laughter. My sense was that they were proud at the sign of homage that my name conveyed to them.

Interestingly, my father's research as to our family's ancestral home led to Cape Coast, Ghana-to a people that also have a very rich and ancient history. Perhaps, the fact that the council of traditional rulers decided to bestow that title upon my father is also not a coincidence.

Mwangi is the name that was given to me by my wife's family when our families connected as a result of our marriage. I have tried to find a meaning for Mwangi but have been unsuccessful.

Anyhow, in a rather long-winded way-I hope that I have answered your question.

If you know the origin of the word "Mwangi" please let me know. Asante sana! Kwaheri, rafiki yango.

Jamo said...

Interesting Blog...

Origins of the name Mwangi...
My surname is Mwangi as well and am a Kenyan from the Kikuyu tribe. There are litteraly hundreds of thousands of Mwangis in Kenya and am sure the origin of the name comes from the Kikuyu language meaning "Wanderer". The word is still used to date in the Kikuyu language. If you wanted to say... so and so is a wanderer then you would say... "so and so is 'mwangangi or mwangi'".
Hope this helps.

Benin "Mwangi" said...

Asante sana kwa kuni sadia.

Just in case my Swahili was to crude to understand-Thank you for your help, Jamo or shall I say, Mwangi.

My wife recently told me something very similiar about the Kikuyu origuns of the word...At first, I said me, I am not a wanderer, why Mwangi-for me? But then, she would probably tell you differently...Maybe a wanderer is not so bad, afterall-I have been known to jump from one finding to the next...but now that I have found what I believe to be my life's purpose, let me now be a pursuer...

Anonymous said...

MWANGI - Wanderer as Jamo rightly said. In kikuyu tradition, an age- group was also named in accordance the society's experience at that particular time. In your case, the "mwangi" age-group was at a time of drought. This age-gropu was sent out to search or wander about in search for better pasture, sources of water etc. Also the name "maina" means singer from the kikuyu word "kuina" so this tells you that during this was a period of plenty and abundance hence the singing and celebration. So the maina's were called to sing and entertain the rest.

Benin "Mwangi" said...


Thank you for the enlightenment. That actually puts my name into much better perspective. If you hadn't told me this, then I may have never known. There is very little information on the web about the origins of the word and you are the first person who was able to elaborate so thouroughly.

Thank you so much!

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