September 27, 2006
Solidarity, Reg: Maghreb, Outsourcing and Reaction
One of the issues that the United States has gotten right in MENA is its sometime concentration (when the gross fabulists that are political leadership of the Bush Administration are not dreaming up imaginary and magical transformations of a New Middle East, in time to render themselves ridculous and fools, e.g. Lebanon) on economic liberalisation as means to grow the region and provide new opportunity. It would do better to focus more on seeing real liberalisation see the day, and let its completely magical thinking about democratisation fall by the wayside.
The political support for such liberalisation contrasts favourably with the absurd double talk Europe engages in with respect to economic policy, above all France (which of course is no worse and in many ways better informed than the self-decieving fabulism the Americans are engaging in on the political 'democratisation' front). The Financial Times has an important article, although one not likely to be noticed by many, on the clash between Axa unions in France and the company over its plans to outsource to the Maghreb.
Although, as the article makes clear, the unions are not willing to be flexible
Axa's plans to open a call centre business in Morocco, employing 1,500 staff and saving the French insurer €75m ($95m) annually, has triggered an angry reaction from trades unions.
Yan Balat, spokesman for Axa France, said the insurer had decided to open a call centre in Morocco after negotiations failed with unions two years ago over proposals for French staff to work later in the evenings and at weekends. Staff at Axa France work a 34-hour week.
"We know the demands of our clients are increasingly important," said Mr Balat. "They want to be able to call us with a question after they finish work in the evening or at the weekend. This is impossible unless we renegotiate the working hours with our unions." He said that unions were presented this month with its recruitment plan, including the Moroccan opening, as part of its strategic objectives, dubbed "Ambition 2012".
No weekend, evening work.
Clients can go fuck themselves of course.
And Moroccan development?
Well, the "alternmondialistes" will talk a good game in grand generalities about Solidarity and the like, but in the end the same people fall into the side of pure protectionism.
Unions have promised to fight the plans. Maurice Zylberberg, representative of the CFDT union, told AFP yesterday that it was "a move of global ideology"by management, pickingon "the ugly little Gallic duck".
Axa's French unions said they "refuse to allow Axa to seize on the godsend of baby-boomers reaching retirement age to off-shore and outsource some of its activities to make more profits that will not benefit its staff".
How about global opportunity?
And of course making more profits, staying in business and extending new services to clients indeed benefit the staff in the end.
A growing number of French groups, including banks and telecommunications operators, have started moving their data-processing and customer relations activities to North Africa, particularly Morocco, to benefit from cheaper French-speaking staff and more flexible working hours.
But France is still several years behind the US and UK, where a flood of companies have opened big operations in English-speaking countries, such as India and Bangladesh. This is partly because the off-shoring of activities is politically frowned on in France and unions are fiercely opposed.
Axa expects 4,500 of its 16,000 staff in France to retire by 2012. It plans to replace some of them by hiring 1,500 new administrative staff in France and 1,500 customer relations staff in Morocco. The insurer also expects to increase its commercial staff by 600.
Axa already has some operations in Morocco, including call centres for its Axa Assistance helpline unit and its Direct Assurance telephone sales business, which both employ about 80 staff.
The French insurer also has three call centres in India, employing about 2,300 staff, to serve customers in its UK, US, Australian and Japanese operations.
Mr Balat said: "There are lots of other companies planning similar moves (in North Africa) but we are one of the first to announce it." Axa aimed to boost its revenues in France from about €19bn last year to €32bn by 2012 and its operating profits from €700m to €1.6bn.
All three Maghrebine countries are building call centre units like mad; indeed call centres seem like a way of giving employment with some meaning and real private sector value-add to the hordes of lit. and other degree holders who are otherwise utterly not prepared for the job market.
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French unions are little more than lobby organisations.
Posted by: Klaus at September 27, 2006 06:28 PM
A couple of years ago I figured out that India and China were going to wind up needing those people at home, and therefore their salaries would rise, and this whole outsourcing thing would begin to lose steam.
A couple of months ago the FT published an article stating that in both places, salaries have risen to the point where both nations find themselves hitting a wall, because the development triggered by outsourcing has fuelled enough domestic demand that qualified people are in short supply.
At my own job, we killed a rewrite of one of our in-house systems by an Indian outsourcing firm because of cost, and I'm now finding myself entertaining feelers about doing the development with the folks I have working for me. Of course, it did take a few years for the English-speaking world to get to here, but it proves the simple point that the amount of work to do isn't finite, as the anti-globalization people seem to think.
Posted by: pantom at September 27, 2006 09:15 PM
"French unions are little more than lobby organisations."
Naturally so, they fight to give their members as big a slice of the pie as possible regardless of what's most efficient. Management does the exact same thing. The company is safely profitable at this point in time so workers don't have to worry about the company going out of business if they refuse to give in so there's really no incentive for them to go along with something that puts their jobs at risk just so management can become even more profitable. Is it short-sighted? Perhaps in the long-run, but in the short-run it's a zero-sum game.
Besides, we wouldn't want the global ideology of quality service to infect France would we? After all, atrociously bad service is what gives France its distinctive charm!
Also, the trend of out-sourcing call centers to India is slowing as companies realize that customers just can't deal with it(and the fact that pinching every last penny leads to awful, French-like service). Call centers are either moving back to America for improved service or to places like the Philippines that are even cheaper than India. Along this vein, would the notoriously snooty French actually tolerate getting help from lowly Maghrebines with their lowly Maghrebine accents?
Posted by: Djuha at September 27, 2006 10:03 PM
"French unions are little more than lobby organisations."
Naturally so, they fight to give their members as big a slice of the pie as possible regardless of what's most efficient.
Not in Denmark, mate. Here, Labour unions don't demand the sun, the moon and the stars as prerequisites for initiating negotiations. They actually live up to their responsibility for society in general, as do the employers. Yes, they duel, but not to the death. I should think the idea of working class solidarity is about all workers, not just those of your own guild. The French have forgotten that. For example, while more taxis are direly needed in Paris, the taxi driver union makes sure no new licenses are granted, to keep prices up. That hurts society, any halfwit can see that. But the taxi driver union doesn't give a shit. That's not solidarity, that's pure egotism.
Hate saying this, but they need a Thatcher.
Posted by: Klaus at September 27, 2006 10:22 PM