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Nutun bets on South Africa as outsourcing destination

By , Africa editor
Africa , 02 Aug 2023
Nutun CEO John Watling.
Nutun CEO John Watling.

Nutun, which is owned by Johannesburg Stock Exchange-listed Transaction Capital, is betting on South Africa as a top global outsourcing destination.

The company says South Africa’s Business Process Outsourcing (BPO) sector has undergone extraordinary growth in recent years and is now ready to expand further, due to worldwide demand.

In South Africa, the BPO market has been marked as one of the green shoots that will guide economic rehabilitation and recovery.

With South Africa's unemployment rate currently the highest in the world, the industry is seen as a driver of the country's job prospects.

According to McKinsey, the South African BPO business was worth $460 million in 2020 and is expected to generate over 775 000 jobs by 2030, with two-thirds serving worldwide clients.

Speaking to ITWeb Africa, Nutun CEO John Watling identifies various market variables pushing the local BPO business.

He says the nation's cost competitiveness enables ‘cost-efficient service delivery, attracting international companies seeking high-quality services at competitive rates’.

"The country has a highly skilled workforce with neutral accents, high levels of empathy, cultural affinity to source markets, and niche domain skills.

"We have 20 million English speakers, 70% lower costs when compared to source markets."

Watling also mentions South Africa's time zone compatibility with major markets, as well as its exchange rate being positive for other markets.

Furthermore, he claims that the government's favourable policies, including the Business Process Services Incentive Scheme, were implemented by the Department of Trade, Industry, and Competition.

"Under the scheme, qualifying BPO service providers can access financial support based on the number of full-time staff employed and the value of their services exported," he says.

Nutun says it is helping job development and youth employment in South Africa by diversifying its BPO projects across numerous locations, sectors, and clients.

According to the firm, it is giving first-time employment positions, through its ‘cradle-to-career plan’, to young people who have a matric certificate (South Africa’s graduation from secondary education) but no tertiary degree.

"In the first half of the 2023 fiscal year, we appointed 2,602 new employees; of these, 785 were youth under the age of 25, and 1,168 were between the ages of 25 and 35," Watling says.

"We place a strong emphasis on learning and development to ensure that we identify top talent, which can advance within the organisation."

According to Watling, continued investment in technology and infrastructure enables companies like Nutun to provide clients with solutions.

He says the company’s focus on providing satisfactory customer experiences distinguishes it in the global BPO landscape.

He says: “Global organisations are focusing more on core competencies and outsourcing areas like customer experience.”

"Several factors will define the BPO market in the near future; one of the most significant aspects will be the accelerated adoption of digital technologies such as AI, automation, and analytics, allowing for increased efficiency and improved customer experiences," Watling says.

“Furthermore, the ability to react to changing client needs will be critical for long-term growth and profitability in this volatile context."

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