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The Warsaw Voice » Business » November 29, 2012
INTERVIEW
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Big Plans for Business Services
November 29, 2012   
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Poland has become a major global player in modern business services, which are booming in this country, despite the crisis.

The Association of Business Service Leaders in Poland (ABSL), which represents the sector, aims to become the European version of Nasscom, the powerful organization representing the IT and BPO industry in India, ABSL president Jacek Levernes tells the Voice.

How big is ABSL?
ABSL is a Polish non-profit initiative that was launched in 2009. It represents about 70 companies, including all the major companies in the business services sector here: from internal shared services, to Business Process Outsourcing (BPO), knowledge process outsourcing, research and development, business services which require knowledge, and call centers. Members of ABSL include HP, IBM, Google, P&G, Shell, Infosys and Capgemini.

Most of the bigger international brands that have invested in Poland are part of the association, especially from the non-manufacturing sector. We represent almost 100,000 jobs.

About 10 years ago there were basically no jobs in this sector. What we’ve seen is the creation of one of the strongest sectors in the country. According to the Polish information and Foreign Investment Agency (PAIiIZ), since the crisis in 2009 we have been either the fastest or second-fastest growing sector in terms of jobs. The automotive industry is the other one. We’ve had about 50 percent growth over the last three or four years, moving from 50,000 to 60,000 jobs, towards probably 100,000 this year.

What was the idea behind setting up the association?
The idea was to come together as investors at a time when everybody was jumping aboard, investing and building service centers. It got pretty hot. The whole idea was “Okay, how do we work together and not kill each other?” The aim was to create a platform for discussion and collaboration.

And of course we’re engaged in lobbying and cooperation on a national and local levels in different cities.

Our aim was also to make sure the public image reflected what we are doing. There was a lot of misunderstanding about what we were doing a few years ago.

Call centers have had some bad publicity....
Some newspapers were writing stories about factories of people processing invoices. A key fact is that more than 90 percent of our people have master’s degrees. The average age of our employees is 28 or 29 and over 60 percent of them are women. A big chunk of the jobs are in financial and accountancy services. The jobs are also well distributed between second-tier cities in Poland like Cracow, Wroc³aw, £ód¼, the Tri-City area and Poznań.

Is ABSL expanding internationally?
A Romanian chapter opened just last month. Because of similar needs. They have about 40,000 jobs now in the sector and a lot of investment. We’ve been helping them to use this formula we have developed for cooperation.

How big a player is Poland in the global business services sector?
Consulting companies have ranked us at either no. 3 or no. 5 globally in terms of the number of jobs in the sector. India and China are clearly ahead of us. There is a discussion about whether we are ahead of or behind Brazil and the Philippines, who are formidable global players, just like Poland.

Meanwhile, Poland is no. 1 in near-shore services in Europe in terms of the number of jobs here. We got there around a year and a half ago.

What are your major successes as an association?
There is a better understanding of this sector in this country, of the growth it’s creating in terms of jobs, of the knowledge and innovation-based potential that we are employing.

We did a lot of lobbying last year together with the Economy Ministry on a proposal from the Finance Ministry to cut grant support for modern business services. There was a dialog about to what extent every zloty in grants can bring money back as investment. Every zloty in grants results in eight or nine zlotys or more in terms of tax income over the following years from knowledge-based business services. We were successful in that lobbying. We are also creating a local chapter on the city level to stimulate knowledge sharing, and local engagement and collaboration.

Is ABSL aiming to become the european version of Nasscom, the influential association representing the Indian IT and Business Process Outsourcing industry?
That’s an extremely important sector, which was one of the key drivers in changing India from a poor country 20-30 years ago to being an interesting and advanced global player in certain areas. We believe there is a place for an organization like that in Europe. I think that’s something we aspire to in the long term.

We believe that just like Nasscom is the voice of India, there needs to be a voice for Europe, which de facto means a voice for Eastern Europe, because most of the near-shore services centers are in Poland, the Czech Republic, Slovakia, Hungary, Romania and Bulgaria.

Why should anyone looking for business services choose Poland or Eastern Europe rather than India? Labor in India is cheaper.

If we competed only on costs, most things should go to India. But if you compete on value and quality, then there are a lot of different reasons why it doesn’t makes sense to go to India for such services.

Languages are very tough to support from India: English for sure, sometimes German and French. But most of our centers in Poland focus on anything from three or four to 50 countries in Europe, the Middle East and Africa.

Further reasons are cultural proximity and EU regulations—in particular industries that’s important, where you can’t move things outside the EU border.

And we have the specialists and experts available. In terms of quality we usually exceed expectations.

What’s the future of modern business services in Poland?
Growth will continue but the rate of growth will not continue at the level we have seen. As the industry changes—it’s a very dynamic sector—we are seeing more and more complicated projects. Before we maybe got a center with 300, 500, or 1,000 jobs for which we needed to hire a bunch of graduates straight away. Now it could be a very specialized center with 50, 100, 150 people where you need half of them to be experts with three, five or seven years of experience.

A Business Services Hub
- According to Everest Group, Poland is the most mature location for offshoring in Europe and one of the top 5 mature locations around the world—the others are India, the Philippines, China and Brazil
- The Hackett Group ranks Poland third as a global business services destination, behind India and China
- 10 of the 23 biggest offshoring destinations in the CEE region are located in Poland
- 337 out of 847 service centers in the CEE region are located in Poland
- Average annual employment growth in the sector in Poland is 22 percent


FACTFILE
Jacek Levernes, aged 39. Co-founder and president of ABSL. Member of the executive management board of HP Europe and vice president of HP Global Business Services in Europe, the Middle East and Africa.

Born in Wroc³aw, Poland, grew up in Norway and Spain. Studied in the United States. Worked in Belgium and Switzerland before returning to Poland seven years ago. Based in Wroc³aw.

Married with one child, with another one on the way.
Education: Undergraduate business degree in the U.S., studied in Singapore, earned a master’s degree in business in Norway.

Postgraduate studies in France at INSEAD, one of the world’s most elite business schools.

Hobbies: Running, traveling and movies.
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