Case Studies in Socially Responsible Outsourcing

Leila Chirayath JanahFounder & CEO,

Socially Responsible OutsourcingCase Studies

Home Work

Bombay, IndiaDharavi, South Asia’s largest slumOver 2.5M people living on 175 hectares

Bombay, IndiaCall center floorMany of India’s 1M BPO workers commute from slum areas

The PremiseTechnology and knowlege jobs can lift entire families

out of poverty.

Socially Responsible Outsourcing

Socially responsible outsourcing promotes economic development and reduces poverty

Foreign capital Small firms Talented people in poor regions

$$$a small slice of the

$160B services outsourcing industry

micro-, small- and mid-sized businesses

untapped talent

Case Study: Digital Divide Data

• Nonprofit social venture led by Harvard graduate Jeremy Hockenstein

• Started in Phnom Penh in 2002 with 25 employees

• Types of services: form and survey processing, transcription, digitization

• Offers education for sex-trafficked women, on-site medical care, scholarship program (financed through donations)

• Currently employs 500+ people at 3x Cambodian minimum wage

• Operationally self-sufficient with revenue from services for clients including the Harvard Crimson

Location: Phnom Penh, Cambodia and Vientiane, Laos

Case Study: Himalayan Techies

• Social venture led by American Ellie Skeele and Nepali MIT Grad Rabi Kamacharya

• Started in Kathmandu in 2000 with 3 people to provide jobs for educated but underpriviledged Nepalis

• Types of services: Software and web application development, IT consulting

• Projects include One Laptop Per Child and Open Learning Exchange programs

• Provides training, on-site recreational facilities, and direct exposure to clients

Location: Kathmandu, Nepal

“I was working in Bangalore before. Now I am home, in Nepal, working on better technology

and allowed to give my opinion about how things should be done. I feel like I am

respected at HT.”

Prakash Gautam, Technical Lead at Himalayan Techies

Case Study: Drishtee BPO

• Award-winning social venture led by Satyan Mishra and Kunal Chawla

• Started in Delhi in 2000 to leverage technology in rural poverty alleviation

• Types of services: Transcription, online research, survey and form processing

• Distributed rural delivery model reduces risk and taps into skilled rural workers

• Provides in-depth training for workers with little prior experience

Location: Bihar, India

Case Study: Daproim Africa

• Run by Steve Muthee, a young entrepreneur from rural Kenya

• Started in 2006 with 4 people

• Types of services: form and survey processing, transcription, digitization, web development

• Offers part-time work to local university students and facilities for disabled workers

• Plans to grow to 20-30 people

• First large project branded as a socially responsible outsourcing firm: $13K

• In pipeline: projects for clients including Benetech, a Bay Area nonprofit, and the African Braille Center

Location: Nairobi, Kenya

Case Study: Preciss International

• Run by two women, Mugure Mugo and Ivy Kimani

• Started in 2002 with 5 employees

• Types of services: online research, data processing, subtitling, transcription

• Offers part-time work and on-site training to university students, young mothers and recent graduates

• Planned growth to 70-80 employees

• 30% of revenue goes to floor employees

• In pipeline: projects between $10K and $100K for clients in the US and UK

Location: Nairobi, Kenya

Case Study: Oriak DigitalLocation: Nairobi, Kenya

View Video >> http://www.youtube.com/watch?v=bjD97YlNhDU

Appendix

32 million rural Chinese leave their towns each year for big cities, in search of work

45 million rural Chinese youth are currently enrolled in senior secondary schools

Source: Wang, Dewen. “China’s Rural Compulsory Education: Current Situation, Problems and Policy Alternatives.” Working Paper Series No.36. 2003

The Organization for Economic Cooperation and Development (OECD)

reports that there are 130 million surplus workers in rural India

Source: “Rural BPO.” Drishtee BPO Presentation. March 2008.

Source: Kenya Ministry of Education; Ghana Ministry of Education; Samasource research November 2007 - March 2008.

Over 990,000 young people graduate from secondary and tertiary institutions in

Ghana and Kenya each year and face staggering unemployment

The Problem: Talent Surplus

Socially Responsible Outsourcing: Definition 1.0

Includes firms located in: (a) a developing country, as defined by the World Bank*; (b) an economically distressed region (e.g., Ceara, Brazil; Bihar, India)

Hire firms in low-income countries

Hire micro-, small- and mid-sized firms

Hire firms that are owned by, or employ a majority of,

disadvantaged people

“Disadvantaged” means: belonging to an ethnic or religious minority group, living at or under the poverty line, physically or mentally disabled

Includes firms that employ between 1 and 249 people

Right now, it’s a nascent set of guiding principles for buyers who want to help low-income and socially disadvantaged people pull themselves out of poverty.

Buyers are encouraged to follow any 2 of the 3 principles in choosing a service provider for outsourcing work.

Principle Clarification1

2

3

How the guiding principles were developedSamasource spearheaded a series of conversations with many organizations from November 2007 to July 2008 to help develop the “1.0” version of these guidelines.

They are only the beginning. In this first iteration, we left out several important considerations, such as labor and environmental standards for service providers.

It is our hope that these principles evolve into the first fair trade system for services.

To learn more, please visit www.sourceoutpoverty.org.

Responsible business groups Service Providers

Buyers

Academics

Industry Consultants

+

Organizations consulted

Socially responsible outsourcing creates positive social impact by:

directly generating jobs for skilled workers in low-income regions with high unemployment levels

indirectly generating jobs for semi- and unskilled workers

reducing skilled-labor emigration, or “brain drain,” in low-income regions

1Ghana

Senegal

Kenya

Uganda

0 1,000 2,000 3,000 4,000

2

Outsourcing jobs in sub-Saharan Africa

1 direct job 2.5 indirect jobs

3

Positive Social Impact

Thank you!

Leila [email protected]