Industry Commentary

AMLO Aside, Mexico Retains Significant Nearshore BPO Value

By July 6, 2018December 14th, 2022No Comments

In the current global business environment, executives are feeling pressure to make decisions quickly, based on sensational headlines that may not tell the whole story.  With many regions facing increased scrutiny regarding public security, economic stability and political transparency, this is even more pronounced in the realm of offshore outsourcing.  With regard to the recent election in Mexico, BPO leaders would be wise to stand pat and consider the value that continues to be derived from that nearshore location.  As the country’s President-elect comes to terms with the challenges and opportunities facing his country, the ongoing delivery of strong customer experience should be the focus of third-party executives.

If there is one thing that can be said about the recent victory of Andrés Manuel López Obrador in Mexico’s presidential election, it was decisive. The leftist candidate, known as AMLO, won over fifty-percent of the popular vote, well ahead of his two main rivals.  Granted, AMLO may not have been the choice of many executives from Mexico’s commercial sector, and many industry observers are wary of signs that he may be hostile to business. Still, his victory should not be viewed as an immediate threat to the front-office BPO space in that country.  At least until the presidential inauguration on December 1, outsourcing leaders should balance AMLO’s platform and statements with the solid value that Mexico continues to deliver to both customer experience providers and clients.

Consider first the breadth of Mexico’s outsourcing delivery points, which range from metropolises such as Mexico City and Monterrey through to border cities that include Tijuana and Ciudad Juarez, all within a short distance from US commercial centers.  From these locations, and many others throughout the country, Mexico has proven itself a reliable point from which large volumes of English and Spanish-speaking agents can be recruited.  These individuals have a track record of servicing consumers in the US, with both commercial and cultural empathy rarely seen in an offshore or nearshore delivery point.

This has made Mexico a hotbed of outsourcing activity, both as a means of servicing American clients as well as the country’s own growing domestic consumer market.  Firms such as Teleperformance, Atento and Sykes are among the global players that have made significant Mexican investments, alongside burgeoning local providers that include Call Center Services International.  Represented by one of the most dynamic contact center associations in the world, Mexico is a front-office success story that will be difficult to derail.  This was validated in the 2018 Ryan Strategic Advisory Front Office Omnibus Survey,in which Mexico ranks among the top 5 most favored offshore destinations.

However, this does not mean that existing and prospective outsourcing investors should be complacent. There remain pockets of instability in the American nearshore, such as Nicaragua, as well as the ongoing ills that plague Venezuela.  In the case of Mexico, it is highly unlikely that AMLO would take his country down a similar path. As former mayor of Mexico City, President-elect Lopez Obrador is likely to understand the role that investment plays in a successful economy and he will work toward balancing the needs of business with ongoing social investment.

As Mexico prepares for its political transition, existing and prospective outsourcers should look closely at what factors have made it a BPO success. The country offers a rare blend of multiple urban centers for service delivery, a talented labor pool, and easy access from the United States. These same players need to also make the effort to sell the new administration on the how the industry has helped build the modern Mexican economy in recent times, and its potential to continue doing moving forward.