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Industry Salary & Benefits Survey: BPO & Captive Contact-Centres, Cape Town 2015

 

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Status has been operating in Cape Town for the last 40 years. So, over this time we’ve seen some long-term trends and changes in the local contact-centre sector and the labour market.

For the last two years, Status has conducted an industry salary & benefits survey for the BPO & captive contact-centre sector in Cape Town.

We have focused our survey only on the Cape Town market in order to provide region-specific data. Salaries vary between South Africa’s three main BPO destinations (JHB, DBN, & CPT). We chose to focus on Cape Town, not only because we operate in the city, but also because the region has seen the most growth in the contact-centre industry over the last five years.

Our local salary survey has been made possible with the participation of local operators, including many leading international brands, as well as top South African brands. For example, in our 2015 industry salary survey included the following brands and participants:

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The aim of our industry salary survey is to produce an informed overview of significant salary & benefits practices and trends in Cape Town, in order to provide local operators (and new entrants into this geography) with a clear guide of market standards for attracting, engaging and retaining local talent.

However, we wanted to keep the survey as easy and quick to complete for local operator participation; but with a methodology that doesn’t compromise the results of our findings. For example, we kept all questions about salaries to monthly Basic salary only, not CTC. This is reflected in all the salary numbers stated in our survey’s findings.

We segmented our survey findings to provide you with detailed insights showing the variations between types of contact-centres (for example, a BPO vs a Captive), as well as between types of job-functions (for example, a customer-service agent vs a sales agent).

We believe this enables local operators to better understand how they compare against like-for-like competitors in Cape Town, but also how they compare to different categories of competitors that may still recruit from the same labour pool as themselves – after all, people in the labour market are often as employable at a Captive operation as at a BPO operation.

We have presented our findings from our salary survey to many of the local HRMs and Ops’ Managers since publishing the completed survey, last year. So far, the feedback has been positive and they have confirmed that the findings are in line with their expectations and, more importantly, with their experiences in the marketplace.

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Now, we’d like to share some of the key findings from our industry salary & benefits survey (2015) with you.

We hope you find the insights in this survey useful for measuring your business’ competitiveness for attracting and retaining top talent in the local labour market.

(And, we hope that you’ll be keen to participate in 2016’s survey.)

But for now, we hope you enjoy reading the industry business intelligence and insights from the Status industry salary & benefits survey in 2015:

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We’ve segmented our findings for the Agent-level Basic salaries into two categories (which themselves are divided further as indicated below):

  1. Operator type: BPOs (international or domestic) vs Captives (international or domestic);
  2. Agent job functions: customer-service, sales, or collections.

Note, the Rand amounts indicated in the findings (below) represent the Agent’s basic monthly salary, not the CTC.

Also, in order to provide the range of salaries on offer in the local marketplace, each of the graphs shows a higher Rand amount in white-font (the average for all participants) and a lower Rand amount in black-font (the lowest salary offered by participants in each market-segment for each of the agent job functions).

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BPO Domestic: These are the local South African BPO contact-centre operators, who’s operations are based in South Africa and who primarily service South African based accounts/customers. They tend to offer the lowest agent salaries in the Cape Town marketplace. However, they’re basic salary for customer-service and collections has risen markedly since 2010.

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Captive Domestic: These are the local South African captive contact-centre operators, who’s operations are part of a larger business (often well known consumer brands). In our survey, the majority of these participants are large financial services brands – with a South African customer-base, as well as some offshore customers (mostly in other African countries). Usually, they have large service, sales and collections operations based in Cape Town. Traditionally, these operations offer higher salaries than BPOs, at both agent-level and for support staff. However, in recent years, the margin of difference between the captives and BPOs has narrowed. But they retain the advantage of minimal shift work, which individuals in the local labour market generally prefer.

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BPO International: These are the multinational offshore BPO operators, with operations based in South Africa (as well as elsewhere) and who mostly service UK based accounts/customers. This segment of the local contact-centre market has grown fastest in the last five years, with many of the largest global players now operating in Cape Town. As their footprint in the region has grown, so has the competitiveness of their salaries for agents (and even more so for team leaders and specialist support staff). Increasingly, they are exploring growing their sales and webchat service offering in Cape Town, in addition to strong customer-service operations.

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Captive International: These are multinational companies that provide services across several geographies and they view Cape Town as a good offshore destination for their in-house contact-centres to service their UK, European and USA customers. Often they are high-value brands who put a premium on service standards, therefore they are willing to pay what they need to in order to attract and retain the best of local talent. Given the Rand is often weaker than their head office domestic currency, they can afford this strategy. As a result, year-in and year-out they offer the highest salaries in the marketplace.

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As a source of comparison, we include BPESA’s salary survey findings from their Annual Key Indicator Report (for 2013 & 2014). As you can see, while there are some differences in the salary amounts offered (reflected in a different, though overlapping, survey pool of Cape Town operators than Status’ survey), the overall trends are very similar to the findings in our survey. [Note, in BPESA’s survey, the salaries reflect the monthly CTC and not Basic only.]

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These findings reflect the average commission (or performance incentive) that some BPOs and captives offer their agents, over and above their Basic salary. The range in each band reflects the average highest amount of commission that top performers make monthly in commission, while the lower amount in each band reflects the average commission that low to medium performers make monthly.

While captive operators have always offered commission for sales and collections, they tend to keep customer-service roles to a basic salary only (along with a strong offer of benefits in the CTC package). However, we’ve noticed in the last two to three years more and more BPOs introduce a performance incentive to customer-service roles, along with mixed results in terms of their employee engagement and staff retention in response to making a portion of their salary performance based.

A notable recent trend in Cape Town is the increased interest in offering sales services in the operations here, whether direct sales of softer upselling as part of the service call. Traditionally, this was viewed as Durban’s competence, while Cape Town was all about customer-service only. Reasons for this changing view of Cape Town are: efficiencies of scale in a single region; an increased demand for a strong service-ethic as part of the sales cycle; and a large talent pool experienced at interacting with the international market.

If you’d like to find out more about this sales trend and the sales talent pool in Cape Town, then read our article: Cape Town’s BPO Contact-Centre Sales Talent Pool.

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In the BPO & Captive Contact-Centre industry, there’s much debate about how best to structure an agent’s salary and what level of pay will attract, engage and retain people at agent-level.

We’ve noticed several things that matter to an agent, but aren’t always reflected in the operator’s thinking on the matter.

(Note, we use the words ‘agent’ and ‘people’ interchangeably below.)

These are:

  • Most agents don’t particularly distinguish between a BPO and Captive or an international and domestic operation, in regard to their employer. In so far as it matters to them, it’s about whichever employer offers the best pay, location, environment, transport, working hours and career growth opportunities.
  • Most agents, once they have a certain amount of work-experience as a contact-centre agent, are employable at most other operations in the sector (and they know it).
  • Most agents are more interested in their Basic (and Net) pay, rather than the CTC. Many of those aged 18 to 28 years aren’t overly interested in benefits like pension and healthcare, especially if these lead to large ‘compulsory deductions’ from their take-home pay. In this regard, operators tend to ‘over-sell’ their CTC salary and not reflect enough on the agent’s Net Basic. This leads to a disconnect between employer and employee on this matter.
  • Agents like working for well-known brands (especially ones where they see lots of varied career-paths, like at a bank), which is a plus for captive operations when attracting, engaging and retaining local talent. And an ongoing challenge for BPOs.
  • Agents prefer working normal office hours. If they are to work shifts, they prefer them to be rotated (viewed as fairer) and to be compensated accordingly. Even when these things happen, they still prefer working normal office hours. Again, this benefits captive operators in the ‘war for talent’ in Cape Town.

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In our next Article on our Industry Salary & Benefits Survey (2015), we look at the salary bands for team leaders, Ops Managers, and specialist support staff

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. If you’ve enjoyed this article and you’d like to see more about the insights and findings of this survey, then you can watch the video of us present it in full, at an industry event last year (which we recorded & put onto YOUTUBE for you):

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If you or your organisation would like to participate in our upcoming 2016 Industry Salary & Benefits Survey (or if you’d like to find out more about Status), then please get in touch with us.

You can contact us at:

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