In a fresh attempt to tap into Nigeria’s huge human capital, stakeholders in the outsourcing industry gathered in Lagos recently to chart a new course for the industry, and advocated a quality workforce in both the private and public sectors to grow the nation’s economy, Raheem Akingbolu reports
Rather than seeing the huge population of Nigeria and its high unemployment ratio as an opportunity to take the advantage of the unemployed youths for cheap labour, employers and outsourcing exponents have been asked to up the ante and approach the market in a professional way.
This was the high point of the discussion at the 2013 Outsourcing Expo, organised by Resource Intermediaries Limited (RIL) and the Association of Outsourcing Professionals of Nigeria (AOPN), which was attended by over 200 registered participants as well as 20 exhibiting companies.
Main Objective
The arrowhead of the expo, who is also the Managing Director of RIL, Olusoji Oyawoye, said the expo was organised following the success of the first edition to sensitise and sanitise the young, but fledging, outsourcing industry.
He said: “Professional outsourcing is new in Nigeria. But companies have been outsourcing -contracting, and calling it outsourcing- for 30 years. This is actually what we are using the expo and discussions to correct. We are out to state that outsourcing is a profession. People should be able to be called outsourcing providers. Outside this country, you get certified.”
Oyawoye, who commended the patronage from local and multinational companies in Nigeria, expressed concern over what he termed ‘contracting’ in the name of outsourcing and urged those who are misconstruing the concept to have a second thought. He said it was a bad signal for the young industry, which in other countries it is being used as a key tool to drive the economy.
Managing Director of Guinness Nigeria, Mr. Seni Adetu, who gave a keynote address at the expo said he accepted the invitation to speak because he saw it as an opportunity to help sanitise an industry, which he described as "very fragmented."
Speaking on the need for outsourcing, Adetu noted that a very competitive landscape as currently exists makes it imperative for companies like Guinness to partner outsourcing companies. He said with keen competition and a need to keep pricing down, “outsourcing companies have come to stay.”
Adetu also added that the core reason for outsourcing is to “build organisational efficiencies and grow shareholder value”, while noting that “the way forward for the business is innovation in outsourcing services.”
In distinguishing the two business concepts, he said: “Outsourcing principally means ceding a business process to somebody or an organisation outside your business. A simple example is, if I was to outsource this event to an event manager, I will tell them I need 30 exhibition booths, for 150 people. We want to start at 9; give me your bills. Whether they set up over-night or three days ago, nothing of that is my concern. In contracting you are involved; you are the one telling them what you want. ‘I want a certain good ten by ten.’ ‘You must make a wall clock to a certain specification.’ When you outsource, what you measure is the result, not the process.”
Regulation
If there is anything that bothers most of the registered outsourcing companies, it is the fact that the industry has not been well regulated in Nigeria. A participant, who simply identified himself as Kinsley, drew a line between what happens in advanced nations like Europe and US and the shabby practices in Nigeria.
According to him; “Western governments may attempt to compensate workers affected by outsourcing through various forms of legislation. In Europe, the Acquired Rights Directive attempts to address the issue. The Directive is implemented differently in different nations. In the United States, the Trade Adjustment Assistance Act is meant to provide compensation for workers directly affected by international trade agreements.
“Whether or not these policies provide the security and fair compensation they promise is debatable. But here, the reverse is the case as government has not really seen the industry as crucial for government prosperity and value added industry to the welfare of consumers.”
Speaking further, the expert explained that one of the main features of outsourcing influencing policy-making is the unpredictability it generates regarding the future of any particular sector or skill-group. “The uncertainty of future conditions influences governance approaches to different aspects of long-term policies,” he added.
Corroborating Kinsley’s position, Managing Director of RIL, Olusoji Oyawoye, said: “In Nigeria, there is no such regulating body. Anybody can just wake up and say they are outsourcing provider. There should be certification. So, if you are opening a chapter at Kano, you don’t just wake up and start. There are exams and other structures you have to pass through to get certified.”
On the activities of the association, he explained that it was set up to gradually begin to sanitise the market and demonstrate to the world that the business is a professional one.
“From the reception we are getting, it shows we are being recognised. Last year, for instance, we had about 150 participants and 50 exhibitors. This year, there are improvements on that. So hopefully, down the line, we will be able to get it to work properly. That is why we want to do it through the registered association, recognised by the African Outsourcing Association and the federal government of Nigeria, which is AOPN.”
In distinguishing the two business concepts, he said: “Outsourcing principally means ceding a business process to somebody or an organisation outside your business. A simple example is, if I was to outsource this event to an event manager, I will tell them I need 30 exhibition booths, for 150 people.
“We want to start at 9; give me your bills. Whether they set up over-night or three days ago, nothing of that is my concern. In contracting you are involved, you are the one telling them what you want. ‘I want a certain good ten by ten.’ ‘You must make a wall clock to a certain specification.’ When you outsource, what you measure is the result, not the process.”
Need for Professionalism
Meanwhile, through the presentation titled, ‘Outsourcing and the Need for the Outsourcing Professional’, Adetu noted that outsourcing providers need to develop proper business strategies because the industry needs a systematic approach.
He said: “Outsourcing users will always want to choose well-funded and large scale outsourcing vendors with good track record for service and support. Some of the outsourcing practitioners have no scale, skill, or idea of the service they propose to offer. In fact, many outsourcing providers are traders instead of professionals, because of the way and manner they comport themselves in business.
“Also, outsourcing as a concept in business in Nigeria has been abused. Graduates with little or no experience have taken to outsourcing in a bid to cut-corners to make money. This practice has soiled the image of outsourcing professionals and there is need to remedy this if there is going to be standard in the industry,” he added.
He harped on the need for outsourcing providers to start thinking of forming mergers to build scale and noted that if they don’t do this, outsider will come and take over the industry, adding: “In the outsourcing world, scale is non-negotiable”.
The Human Resource Director, Flour Mills Nigeria Plc, Mary Uria, who has had robust interaction with outsourcing providers, commended the organisers of the event, stating that when her company ventured into outsourcing in 2005, there was a dearth of professionals in the industry.
She noted that it is good that professionalism is now being infused in the industry and that it will help the country and business in the long run.
Finance and accounting (F&A) was one of the first processes that companies outsourced, and the practice continues to boom: Ed Thomas, an analyst for
