COLOMBIA: SHARED SERVICES CENTERS
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- Ophelia Ball
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1 COLOMBIA: WIDE ARRAY OF QUALIFIED HUMAN CAPITAL, STRATEGIC GEOGRAPHICAL LOCATION AND INFRASTRUCTURE TO RUN SHARED SERVICES CENTERS SHARED SERVICES CENTERS A strategic and privileged geographical location. Qualified human capital skilled professionals able to meet the Service Centers industry requirements. A data infrastructure capable of supporting world-class operations. Sustained growth of the BPO industry. A Government committed to the sector. BENEFITS FROM SETTING UP A SHARED SERVICES CENTER Cost reduction through a single expert management team. Process-driven approach: relieving operating loads from the core business, thus allowing strategic teams to focus on key business activities. Management process standardization and simplification. Unique control environment: company information control and centralization at the regional level. Quality assurance, streamlined service, and continuous improvement. More efficient strategic support to help the company. Li b retad y r Odn e
2 KEY DRIVERS IN THE COLOMBIAN INDUSTRY Between , the number of students graduating with Business Administration, Accounting, and Economy-related degrees was approximately 962,761, and the number of engineers was approximately 635,965. (Ministry of Education, 2015) Colombia was included in the Top 30 Countries for Offshore Services report. The report features the advantages of the country s location to run call center operations and transactional BPO activities, as well as the government s proactive support towards the IT sector and competitive costs. (Gartner, 2015) Cultural Ties: in terms of language, Colombia has the second largest population among Spanish-speaking countries around the world, making it ideal to serve the Latin American market. In addition, the Colombian accent is one of the most neutral sounding, which is perfect for voice servicing. (Economist Intelligence Unit, 2014) Costs and quality of labor: Colombia is second place in average salaries in the region, keeping quality in line with labor costs in addition to Colombia ranking as a competitive market in terms of office costs. (IMD, 2014) Colombia has become an exporting platform for Latin America, the US, and Europe, providing voice and back office services in Spanish and English for the most part. According to the IMD s World Competitiveness Yearbook 2015, Colombia is the South American economy with the best-qualified work force, way ahead of countries like Peru and Brazil. Within South America and Central America, Colombia is ranked second place.
3 A STRATEGIC AND PRIVILEGED GEOGRAPHICAL LOCATION Located in the middle of the major business and financial centers in the hemisphere, it shares cultural linkages, important in the consolidation of regional operations. COLOMBIA enjoys a highly strategic location - the country is at the center of five time zones and sits in the same zone as important business centers such as New York, Toronto, and Miami. As of 2015, Colombia has: 1,082 direct international flights per week, 5,984 domestic flights per week, it is located less than 6 hours from the main capital cities in Latin America, and there are 24 different airlines operating in Colombia. (OAG, december 2015)
4 WORLD - CLASS INFRASTRUCTURE HIGH CONNECTIVITY COLOMBIA HAS 10 SUBMARINE CABLES, INCLUDING: CFX - 1 MAYA - 1 Sam 1 25,000 km Globenet 23,500 km Cfx 22,000 km GLOBENET SAM - 1 AMX - 1 PCCS ARCOS BARRANQUILLA CARTAGENA TOLU PAN-AM Submarine data infrastructure in Colombia has increased. currently, there are 10 cables that reach colombian shores, with traffic focused on the Atlantic and recently towards the Pacific. (IT Manager, 2014) Cali is becoming a key location for data output to Asia. (IT Manager, 2014) CABLE MEDELLÍN DESTINATION IN COLOMBIA Tolu Arcos Riohacha and Cartagena Columbus Network Axtel Lit Capacity: 450Gbt/s End of life: 8.4 Tbt/s Amx - 1 and Cartagena America Movil End of life: 85Tbt/s Sam 1 Telefonica Lit Capacity: 40 Gbt/s PanAm Tata Communications AT&T Lit capacity: 70 Gbt/s End of life: 300 Tbt/s PCCS Cartagena Cable & Wireless Telefonica End of life: 10 Tbt/s CFX Cartagena Columbus Network Lit capacity: 900 Gbt/s End of life: 12 Tbt/s Globenet BGT Pactual Lit capacity: 1.2 Tbt/s End of life: 7 Tbt/s South American Crossing Buenaventura (Pacifico) Level3 Lit capacity: 8 Tbt/s San AndresTolu San Andres - Tolu MinTic 826 km SAC CALI CAPACITY Maya BUCARAMANGA BOGOTÁ BUILDER Cable & Wireless Verizon Source: Teleography Gbt/s
5 COLOMBIA, A COUNTRY WITH MULTIPLE DEVELOPMENT CENTERS OPENING OF NEW MARKETS Continuous consolidation of trade relationships between Colombia and the rest of the world opens a window of opportunity for investment in all business outsourcing services. Given the shared service industry seeks for process centralization and services exports to the region, Colombia becomes a highly prepared destination for such operations. INTERESTING GOVERNMENT PROGRAMS Bogotá Medellín Cali Bucaramanga The National Government is determined to provide support and help through the Productive Transformation Program, a strategy focused on promoting the development of the sector which, in recent years, has created a positive momentum to build world recognition. The work the program conducts within the sector is centered on four drivers: human capital, standards and regulatory framework, strengthening, promotion and innovation of the sector, and infrastructure and sustainability. A government plan with the purpose of fostering economic growth based on the use and approval of ICTs among the Colombian population and development of a national digital environment. This project is led by the National Government and MinTIC. Among other results, it is expected to provide connectivity for 1,078 municipalities for a total of 1,100 by Job creation program: the objective is to create a 40,000 employment program for young people between 18 and 28 years old with government support for salaries and payroll taxes during the first 6 months.
6 ATTRACTIVE REGULATORY FRAMEWORK COMPETITIVE LABOR REGULATIONS Flexible shifts in a 48-hour week spread across 6 days; up to 10 continuous hours per day without overtime. There are no minimum local employee thresholds when hiring foreign workers. Flexible salaries according to different types of work contracts. VALUE ADDED TAX EXEMPTION Applicable for cross-border services granted in Colombia, either used or consumed exclusively abroad. To be eligible for this tax exemption, Colombian companies must be enrolled in the Unique Tax Registry as a service exporter and hold the relevant documents that authorize service exports. MAJOR FOREIGN COMPANIES CHOSE COLOMBIA AS AN INVESTMENT DESTINATION TO SET UP SHARED SERVICE CENTERS AIG Holcim chose Colombia due to the quality of its human values, qualified personnel, hard-working attitude, and commitment to service. A service center relies on its human resources, and Colombia provides skilled personnel capable of providing high-quality services to eight different countries in Latin America. Alejandro Carballido, CEO Holcrest There are a number of reasons why we decided to invest in Colombia: Colombia has a strategic location in the middle of the region; from the business and institutional point of view, the country is very stable, with a bright future ahead and, most importantly, people here meet our expectations. Colombia has great talent, trained professionals, several universities, language-proficient staff, and people with great passion and energy making a difference. Gonzalo Arias, CEO SSC Diageo Colombia. For Johnson & Johnson Colombia is a Strategic country for them to go. They believe that Colombia is very appropriate for them to start a shared service center. The three main reasons are: first of all Colombia is a very stable economy, second it s a country that has strong institutions, and third because it s also a country that attracts a lot of talent and well educated people. Susan Rivetti, Johnson & Johnson Chairman Latin America After an exhausted search AIG determined that Colombia was the best option based on the progress that they will find and the most exceptional talent. They also know that there is a great stability in Colombia. Today, Colombia is a very safe place to invest and life. Jorge Gilling, Gerente General Centro de Servicios Compartidos AIG Colombia.
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