Sorting out the BPO issues; is subsidy the answer/problem?

Before the $8 million BPO subsidy was released by the World Bank, Kenya government official hyped it up and made it look like it was the savior for the rickety BPO industry.

The money took long before it was released and there were murmurs that the money may not be released. Then the grant was finally approved and the story has changed. It looks like many companies the BPO industry will not pass the rigid test set by the government and the World Bank and the money may end up going back to the WB or finding other use within the government.

There is no doubt that by the time the ICT Board invited the industry to celebrate its renewed ability to negotiate grants, it knew that many companies were ailing and not in a position to meet some great deal of scrutiny.

Yes, some companies may be merely briefcase entities hoping that the grant would help in setting up, which may be indicative of a greater need to train and support the companies both from other established institutions as well as the government.

In the debate whether the small companies should benefit or not, one can not help but wonder whether bandwidth costs is the only problem affecting many companies in the BPO sector. What about the business plans and models? What would happen if you subsidized a company based on the wrong model? Does it mean it becomes better?

The board maybe entitled to asking questions about the client base and other questions considered confidential; it would be proper for the board to determine the viability before handing out the money.

Whether well intended or not, it is sad that only a fraction of the $ 8 million has been spent. Maybe the board can sit with the industry and identify the best way to go about it.

The problem with the BPO industry is that there are some companies that deem themselves more qualified than others and take up much of the work that may come through government connections through direct enquiries.

I will never forget one person, going by the name "Wambui Wakarema" who used to write very bitter emails about how the board has handled the whole BPO subsidy and marketing Kenya as an IT destination.

As it turned out, Wambui was just a disgruntled business person in the industry who had created a phony account to vent out the anger and give some insider information on some of the things going on at the board.

The board may claim that it is doing a great job, for instance, it paid McKinsey $ 500,000 to do a study on Kenya BPO and recommend how Kenya can maximize its potential. I have not seen the report but I am not sure it will include very groundbreaking issues.

If we have not put our house in order, it does not matter how well the industry is positioned. There are fundamental things that need to be addressed and until then, countries like Ghana will continue excelling as we continue bickering.

The media has been blamed for writing negative stories but my answer has always been; if you do not want negative stories, then make positive ones!

Ends