Datamonitor's recent study found political instability and threats of terrorism worldwide make some countries less attractive; many companies are looking to Canada as an alternative.
Posted Feb 13, 2003
As more and more U.S. corporations seek to house their call centers overseas to cut operating costs, political instability and threats of terrorism worldwide make some countries less attractive. But a recent study, "Opportunities in North American Call Center Markets to 2007," conducted by research firm Datamonitor, finds that many companies are looking to Canada as an alternative.
Some benefits our neighbor to the north possesses are a stable economy, a multilingual population with slightly higher unemployment rates than the U.S., and government incentives for call centers. In addition, with the Canadian dollar valued at around US63 cents, potential cost savings are significant, the study says.
The study notes that many U.S. companies have already migrated north. To date U.S. companies account for approximately 80 percent of all new call center positions created in Canada.
Apart from the cost benefits, the study claims that political and economic instability abroad, especially in popular call center outsourcing locations like India and the Philippines, create an additional sweet spot for the Canadian call center market. Also, travel considerations are minimal, which can be a comfort as many companies have shied away from international travel following September 11, the study says.
Also in the study is research that claims most call center technology in the near future will most likely come in the form of upgrades that improve existing functionality. Among the most popular features to be added to existing call center solutions are Web-based self-service and voice recognition technology.
The study warns that due to the relative maturation of the market and the slow growth of call centers in the U.S. through 2007, these upgrades and improvements will be vital for future vendor success in the United States. Several large companies, including USAir, MetLife, and Sears, have recently closed down a number of their call centers in the U.S., a trend that is likely to continue as more U.S. call centers shut down completely or move to less expensive regions in Canada or other countries.
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