Kato: Egypt is an ideal choice for establishing multilingual customer service centers

This week’s interview is renewed with Ta3heed newsletter, and this time we interview Ramy Abdelfattah Kato, one of the prominent leaders in the outsourcing industry and the former CEO of Vodafone International Services (VOIS).

Kato believes that Egypt has many competitive advantages that make it an ideal choice for multinational companies that want to establish multilingual customer service centers.

Kato believes that what most distinguishes the Egyptian market is the availability of qualified human resources who can speak a variety of languages.

Egypt is taking rapid steps to create an investment climate for the outsourcing industry. What are the incentives that support Egypt’s attraction of new investments in this industry?

The outsourcing industry depends on two basic elements, the first of which is economic feasibility, as companies are always looking for economic incentives to transfer their business from developed countries with high costs to developing markets with competitive prices.

Therefore, the price in exchange for the added value provided is an essential element in attracting international companies to the Egyptian market.

During the last period, due to the currency difference, Egypt has had a very high competitive advantage in prices, as some of our services have become cheaper than India, which is a competitive advantage that positively affects international companies to transfer their business to Egypt or increase their expansion in Egypt.

The other element is the availability of human resources talent who have the necessary qualifications to provide outsourcing services from Egypt. The more young people with an acceptable level of foreign languages as well as an acceptable technical level are available, this will increase Egypt’s competitiveness as a source of outsourcing services and a major destination for this industry.

Creating an investment climate will support attracting new international companies to the Egyptian market

What does the investment climate need for the outsourcing industry in Egypt?

There are 3 key factors to improve the investment climate for the outsourcing industry.

The first is continuing to improve the mental image of the Egyptian market among foreign investors, especially after the negative impression after the events of 2011, as well as continuing to promote and market Egypt as an important destination for this industry, and I believe that this will take some time to overcome.

The second factor is improving Egypt’s competitiveness, which has begun to improve over the past years, especially after the liberalization of the exchange rate.

The third factor is improving the business environment in general. Outsourcing companies are like any investor. The better the business environment, the greater the chances of attracting new investments in this industry, and it contributes to improving Egypt’s ranking in global indicators for the outsourcing industry.

Do the political tensions in the Middle East region, including wars and tensions, affect Egypt as a destination for outsourcing?

The impact depends more on the length of this war. The sooner the situation stabilizes, the more this will be in the interest of industry in Egypt.

This is due to several reasons. Many of the West do not know precisely Egypt’s geographical borders and do not know how far the distance is between Cairo and Sinai, as well as the borders with Gaza and other geographical matters. Therefore, as soon as they hear there is a war in the Middle East or the name of Egypt is mentioned in the news, they imagine that there is a war in the Middle East. Instability in Egypt, which gives a negative impression to the investor.

On the other hand…will the continuation of the war in the Eastern European region contribute to Egypt attracting business from companies from that region?

Indeed, the outbreak of the Russia-Ukraine war contributed to many international companies moving towards the outsourcing industry to the Egyptian market, especially since the Eastern European region is full of young cadres in the technology sector and is a major competitor to Egypt. However, with the outbreak of the war, many companies decided to move away from the area of tensions and began expanding their presence in Egypt. Or transfer the provision of its services from those markets to Egypt.

I believe that Egypt also has a good opportunity to attract companies providing outsourcing services from Israel, especially due to the state of instability that the country is currently experiencing.

Former Director of VOIS: The Egyptian market is competitive in prices and we have a great opportunity for growth in shared services

What markets are considered a strong competitor to the Egyptian market?

The outsourcing industry can be divided into three parts as follows: “customer services – shared services – technology services”.

Regarding the first part related to customer service, Egypt is strongly distinguished from any other market, due to the competitive advantage in prices compared to the Indian market, for example, as well as the distinction of Egyptian youth in being fluent in the language without having an accent, unlike Indians.

Likewise, there is no market in the world that has this base of young people who are fluent in many different languages. For example, North Africa excels in French only, Latin America excels in Spanish only, Turkey excels in German, and South Africa excels in English.

While in Egypt there is a group of qualified young people who are fluent in multiple languages, Egypt is therefore an ideal choice for companies that want to establish a multilingual customer service center.

I believe that the real challenge before us is to maintain and improve this level by focusing on teaching languages at the university and not being limited to scientific subjects only.

As for the second part, which concerns value-added services, “shared services.” A short time ago, some companies began establishing centers in Egypt, such as Al-Futtaim, PepsiCo, and Unilever. This is a good indicator, putting Egypt on the list of this type of services, and this sector has a strong opportunity for growth.

But to exploit the growth opportunity in this sector, the focus must be on developing the technical skills of individuals as well as working on mastering a foreign language, especially accountants, lawyers, marketing specialists and other value-added services.

The third part of outsourcing services is related to providing technological services. In this part, companies need young people with more experience and specialized certificates in certain technologies. Therefore, young people in specialized colleges must be made aware of the need to work on developing their skills, whether through summer training or obtaining specialized courses and certificates. In technology.

In fact, the Ministry of Communications and the Information Technology Industry Development Authority (ITIDA) are making a strong effort in this regard, as is the Information Technology Institute (ITI).

But value-added services face a strong challenge represented by the migration of human resources. How do you see this?

This is true, but the percentage of immigrants among the technical cadres is not influential. Likewise, the exit of these cadres to foreign markets is a praiseworthy matter, as this contributes to increasing remittances from Egyptians from abroad on the one hand, and on the other hand they gain more experience and skills as a result of their work in these markets, which may be beneficial. On the Egyptian market from a technical standpoint if they return to leading companies or even establishing companies.

There is always a bad mental image of the call center profession. How do you see that?

This is true, but the bad reputation is due to the fact that some companies do not follow the proper specifications for service, as there are some companies that do not have enough skilled administrative human resources to develop a good plan for the work of the call center employee so that he is not subjected to nervous and psychological pressure, which causes an increase in the work of the call center employee. Rates of employee exit from the company.

But if companies resort to the proper method of managing this system, such as allocating time for rest and providing a healthy environment for work, they will find that employee exit rates from the company are low.

Young people must also be aware that the call center profession is not the profession of a lifetime, but rather an entry point into the industry. He must learn and develop his skills during his work period in order to move to a better job.