‘Visa flexibility would boost SA outsource potential’
South Africa’s hopes of serving as a global outsource destination to drive foreign investment are achievable, as evidenced by the phenomenal success of DigiOutsource, a global enterprise based in Cape Town, South Africa, and serving international gaming clients.
DigiOutsource has been developing and maintaining software and IT systems, running client operations and manning a contact centre for leading online gaming sites around the world for several years. Now with a local staff complement of around 1,500 and a turnover in the hundreds of millions, the company is described as ‘the biggest SA success story you’ve never heard of’.
DigiOutsource CEO David Stevenson says the company was born of a matrix of local outsource firms, who elected to keep their base in South Africa some years ago.
“South Africa has highly skilled and talented resources at a cost to company more competitive than in many countries elsewhere in the world. When we first chose to keep our base in Cape Town, it was because we liked South Africa and not because other options were more expensive. If you go back 15 years, this was a high margin low cost business, so the business could have been set up anywhere. Now, it’s a low margin high cost business like any mature industry, and the dynamic has changed and where you set up the business is a key factor,” says Stevenson.
The South African work ethic is excellent, says DigiOutsource, and South Africans tend to be flexible on shifts and working hours, which is necessary when servicing clients across time zones. In addition, the fact that the company’s hub and staff apartments are situated in a prime location in Cape Town serve as a drawcard to international employees, who bring essential foreign language skills to the business.
In a highly competitive sector, DigiOutsource must attract young graduates fluent in global languages to serve gaming customers around the world. The company has on its payroll professionals fluent in French, Italian, German, Spanish, Portuguese, Czech, Polish, Danish, Swedish, Finnish, and Russian, as well as staff originating from the Americas and Australasia. “We offer a turnkey service to our business partners, supporting any language and culture that they want, and this is why they give us the business. If we couldn’t serve certain territories, we’d find them starting to look at other partners elsewhere in the world.”
DigiOutsource recruits between 300 – 400 new foreign employees each year, a task which can prove challenging in the face of stringent visa requirements.
“It can take up to six months for a visa application to be approved, during which time our new recruit must be based at our office and transit centre in London,” says Stevenson. “Running this London office increases our cost of doing business and means we must allocate resources there which we could deploy more effectively in South Africa. He says that while the customer-facing language specialists are crucial to DigiOutsource’s ability to service its international clients, it should be noted that each language specialist is backed by scores of local professionals in admin, support, risk and fraud management, technical and software development roles.
“In addition to hundreds of local jobs created, our monthly wage bill is around R40 million, and this goes back into this economy. Add our bonus month at the end of the year and you’re looking at over half a billion rand in wages that we are ploughing back into the economy. The harder it becomes for us to bring in foreign language skills, the harder it would be to service our clients effectively and the greater the risk of this money moving to Eastern Europe or wherever else a client might decide to move its back offices,” Stevenson says.
While DigiOutsource recognises the need to drive South African employment, it believes the government could take a more flexible approach to work visas to support international firms generating local revenue. “The government could look more closely at businesses bringing in foreign skills and ask ‘what are you doing?’ If you looked at our business and saw what we contribute to employment and the fiscus in terms of salaries, you would recognise that even though we are global facing, we aren’t taking jobs away from local people,” Stevenson notes. “In our case, we have a certain number of foreign-language frontline staff, but many more local support staff behind the scenes. The moment you start driving the language skills away, you also start shifting the support jobs away.”