- April 12, 2022
- 1:53 am
Comparing BPO trade with processing trade in trade in goods, it shows the following characteristics
BPO trade requires appropriate Internet infrastructure and intervention conditions, so there are higher requirements for the information infrastructure conditions in the region. Relative to the processing trade in the trade in goods, there is a high barrier to entry for the development of BPO trade It is also for this reason that the current service outsourcing trade is concentrated between some developed and emerging market countries, and the world’s least developed regions have little to gain from it. For example, a 20o4 UNCTAD survey showed that India accounted for 33 percent of the offshoring of Europe’s top five hundred companies, 29 percent in Western Europe, 22 percent in Central and Eastern Europe, and less than 4 percent in Africa.
Under the traditional model of capital and human division of labor in trade in goods, developing countries often pay the price of sacrificing the environment in the process of attracting foreign investment to give full play to their human resource advantages and increase employment. As a modern form of trade in services, BPO trade does not require producers to consume natural resources and has almost no impact on the ecological environment. For example, GE in the United States employs up to 20,000 people (about the seating capacity of Madison Square Garden) in India to handle the group’s business, from accounting to telemarketing, through the Internet. In addition to the large amount of electricity consumed, there is almost no impact on the local ecology.
In traditional manufacturing processing trade, labor is in a secondary position relative to capital and technology, and low-tech production enterprises rarely need to provide special training for employees. Against the backdrop of an abundant labor supply, the low barrier to entry for employees has also led to a lack of incentives for enterprises to care for humanities. However, in service outsourcing enterprises, the quality-of-service outsourcing business depends on the business level and enthusiasm of employees, and production equipment and capital are in a secondary position. In the case of a call center with a low technical content (CALL CENTER), the hardware facilities are basic communication equipment, and the quality of service depends on the foreign language proficiency and attitude of the staff. Therefore, service outsourcing enterprises have a large investment in employee training, and the emphasis on employee enthusiasm also makes service outsourcing enterprises more motivated by humanistic care
BPO trade is concentrated in intellectually intensive industries in the service industry, such as software development, banking, insurance, human resources, management, and other fields. To concentrate the core competitiveness of enterprises, contract-issuing enterprises often transfer low-end business links to outsourcing enterprises. But even so, BPO, as an organic component of the modern service industry, still has a higher technical content than traditional processing trade. For example, in software development outsourcing, the outsourcing of peripheral programs can still improve the business level of the employees of the outsourcing enterprise. Secondly, as a service industry, BPO trade requires a lot of business communication and exchange between suppliers and customers, which has a stronger knowledge spillover effect than the form of processing trade in the manufacturing industry. For example, in the late 1990s, Indian software outsourcing companies solved the Millennium Worm problem for American software companies, thus mastering many source code programs of American software companies. On the one hand, this deepens the depth of cooperation between enterprises and allows Indian companies to reap the benefits of knowledge spillover.
