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With additional investment, it is estimated that BPO could reach 4 percent of the region’s gross domestic product. Both the private and government sectors are striving not only to reach this potential but to exceed it.
ships. The government of Guatemala is also implementing disaster risk management, and fortunately, this business sector has remained free of the inefficiencies and corruption that plague some areas of the nation’s economy.
This strategizing and increased focus has led to Vision 2020, a plan for the future that sees the BPO industry reaching nearly 4 percent of Guatemala’s gross domestic product (GDP) by the year 2020. As of 2013, it contributed 1.25 per- cent to GDP, but Vision 2020 forecasts the direct employment of 100,000 workers by 2020, up from 35,000 in 2013.
INSTALLED AND INTEGRATED
The highly developed telecommunications framework in Guatemala meets the critical capacity requirements that are essential for a BPO call center to operate efficiently. Redun- dancy levels of 99.99 percent connectivity have been achieved by three submarine and two ground cables, while STM-6 installed capacity and 4G wireless are readily available. Nu- merous internet and phone providers have helped Guatemala to create 20 million cell phone lines while also allowing for enough competition to keep technology costs low, yet speeds still reach 10 megabits per second (Mbps) on fixed lines and 30 to 50 Mbps for internet. The region’s powerful electric grid
also assists in technological performance, reliably covering virtually all of Guatemala City as well as the country’s other large cities.
Though India continues to set the precedent for business process outsourcing, it could be argued that Guatemala’s ceiling in the industry is much higher. The number of young and educated Guatemalans entering the work force continues to grow, the education system is maintaining an emphasis on the benefits of quality customer service, and the government itself is highly focused on promoting the industry. Guatema- la’s location in the U.S. Central Standard Time zone allows for easy co-scheduling with clients, and its airport offers more than 160 direct flights to major cities around the globe. Add in the tax incentives from Guatemala’s 18 Free Trade Zones, and the attraction to the region is even higher. Large corpora- tions such as Xerox, TELUS, and Capgemini house BPO op- erations in Guatemala, while BPO management firms Atento and Genpact have also expanded their operations by creating call centers in the country. As governmental focus and cultur- al appeal simultaneously create connections to the industry, investment opportunities for business process outsourcing
in Guatemala will continue to advance in prominence and profitability.
GUILLERMO MONTANO President
TELUS International
Thanks to its close proximity to the United States and a busi- ness environment that is highly attuned to American culture, Guatemala holds significant po- tential for business expansion. Business process outsourcing (BPO) is one industry that has found a successful niche in the Central American nation. Still, many investors are not familiar
expect to see the internationalism of the city.” And it is not just location and culture that recommend the country to investors. Overhead costs such as energy, rent, and communications are extremely competitive, especially when compared with regional hotspots like Panama. Montano notes that labor laws create an- other advantage: “If you’re not able to have a certain flexibility regarding hiring and firing, schedules, and the like, it’s tough to do business.”
“Guatemala is well positioned to continue growing. Our main problems,” opines Montano, “are credibility and perception.” The solution? “The perception change starts with us locally.”
“We serve international clients from Gua- temala in the BPO sector and I always say that our biggest challenge is to con- vince the potential client to do a site tour. So once they come here, they love it.”
with Guatemala and perceive it as having security issues, so its investment potential is frequently overlooked. Guillermo Monta- no, President of global BPO firm TELUS International Central America, is looking to help turn things around. “I think we have not been proactive in changing that image. The government has not put enough effort into attracting foreign investment to Gua- temala.”
IN THE PLUS COLUMN
Visitors to Guatemala are often pleasantly surprised. “They come to Guatemala and they’re blown away because they do not
96 STRATEGY
SPECIAL REPORT
Will Location Win Out over Perception?