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Ask the Experts – January 05

The following are actual questions posed to the TRG experts. You can pose your questions on our website.

Malaysia as an Outsource destination

Question: “What is the prognosis and the possibilities and actions required for Malaysia to become a competitive offshore, outsource call center destination?”

Expert Response:

The recent and forecasted growth of call/contact centers in Asia-Pacific is outpacing the rest of the world. In 2003 Asia-Pacific represented 8,600 call centers and 420,000 agent positions. Datamonitor has predicted this market to grow at a CAGR (Consolidated Annual Growth Rate) of 15.1% per annum and to total over one million agent positions by 2008.

With approximately 250 call centers operating today, an industry association in place and a highly multilingual workforce Malaysia should be well poised to capitalize on the outsourcing trend. However Malaysia is handicapped by amongst the highest labour costs in the region. The labour costs, a higher level of staff turnover, than India or the Philippines, a shortage of experienced staff and lack of governmental focus will limit to near term prospects for the Malaysian call center industry. Government support, investment and leveraging the existing number of Regional Head Offices and technology firms located in Malaysia will be critical to developing a significant offshore call center industry in the country. In the near term I expect that the Malaysian industry will grow at about the 15% level over the next year, but at this growth rate it will be losing ground to India and the Philippines.

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