The still infant local Business Process Outsourcing (BPO) industry is promising some 1 000 jobs by the end of 2004. In some way, this will kick-start the much talked about transformation of the island into an international hub for IT and ITES (IT-enabled services).

New avenues for BPO are opening up as more and more multinationals are shifting operation, and even control, of business tasks away from their head offices. But getting a slice of the pie will be a tough battle for Mauritius, which, for all its grandly declared ambitions, is still resource-deficient in many respects.

As the country is busy trying to sort out its various limitations in terms of skills, infrastructure and technology, it really has to think hard on how to make the most of the changing economics of international business. The increasing ease and falling costs of telecommunications have helped multinationals and many other Western companies find themselves a fresh configuration. The outsourcing of both peripheral and key operations to offshore centres like those in India is seen by many as a key strategy to achieve global competitiveness.

The initial wave of sending business tasks abroad was largely driven by a desire to cut costs, in pretty much the same way as manufacturing firms shifted production to third world countries in search of cheap labour. Basic functions, like data entry, were the earliest candidates for offshoring. Gradually, outsourcing moved into the processing kind of activities such as accounting, customer relations management and payroll services. New business models are now emerging as global connectivity and interactivity are further improved and as BPO service providers are willing to handle more complex jobs. A growing number of business criticalities, including control functions, are being relocated outside the company?s headquarters.

There is an understanding that this level of outsourcing involves a change of control, rather than a loss of it. Activities like design, research and development (R&D), and quite a lot of the strategic thinking and analysis stuff are moving offshore. The high-end of the BPO spectrum is definitely getting richer with higher value-added services. Once again, India, with a competitive and skilled manpower as well as the necessary infrastructure, is ready to take up the challenge. Its industrial laboratories, for instance, may well serve the R&D requirements of many multinationals.

Where does Mauritius stand amidst all these new dynamics? With a largely under-employed pool of accountants, the country has all that it takes to compete in the financial BPO segment. There are some big global players like Accenture and Ceredian Centrefile that have already established business on the island. The country already has the manpower to deliver services in the area of accounting, customer invoicing, payroll and human resources?

The manpower strategy should now focus on achieving a critical mass in the industry as quickly as possible so as to enhance the visibility of local service providers as possible partners in the new global supply chain.