The business service sector offers long-term career paths
Around 100 000 people work in the business service centres of multinational companies in Hungary. "Our priority is to make the sector better known to employees, so that they see the industry as a significant career opportunity and a high added value creator, where language skills are one of the most important skills," says István Lenk, President of ABSL (Association of Business Service Leaders) Hungary, the successor organisation to HOA (Hungarian Outsourcing Association). They can also offer new careers to people who are good at foreign languages because of the changes in the kata (specific business tax for small taxable enterprises) - such as translators, language teachers and tour guides.
In recent years, the services sector has been expanding steadily. What is the situation now and what are your expectations for the near future?
At the moment, it seems that fewer new players are entering the market, but existing Business Service Centres (BSCs) are expanding their scope of activities with languages, supported processes, and greater emphasis on higher added value, knowledge-intensive areas.
This also means that the quality of investment is improving and the service sector is a more attractive prospect for employees, as service centers tend to have multilingual, multi-skilled staff, from entry-level to senior management. This means that a good career perspective and meaningful, value-adding work are also expected by employees. The industry is increasingly moving in this direction.
And in the current economic and political situation, companies are looking for lower-risk activities, so they are not necessarily outsourcing processes to the Far East or Asia, but rather trying to keep services local or in the Central and Eastern European region.
How much growth do you expect in employee numbers this year?
It's difficult to say because the sector itself is not well defined at the moment, there is no specific TEÁOR number to classify the activity. Cooperation with the HCSO is being developed in order to define it. The aim would be to include in this definition and scope those operators who are engaged in centralized activities in the market and are part of the business services sector, so that data can be collected on them in good quality. This is also necessary for comparability and to assess regional competitiveness.
I am deliberately not talking about SSCs, but about business service centers - BSCs, because these organizations serve both direct customer relations and suppliers, as well as internal processes for the parent company. In other words, they cover all parts of the business portfolio. There are many different definitions of self and external alike, and this needs to be standardized in some way. This is the aim of a joint project between the ABSL and the HCSO, which will provide market players with an accurate picture of the sector, with good data.
If I had to give a figure, I would put the number of people employed in the services sector between 80 000 and 100 000. But it is precisely because of the uncertainty that is why it’s difficult to give an answer on growth, on expansion.
What are the processes that are expanding the range of services?
Classically, transactional activities - customer service, finance, supply chain - used to belong to the centers, but now we are moving towards more knowledge-intensive processes, such as IT, in many cases global digitalization processes are emerging here, but also supply chain or even HR services are moving to a new level. In the financial area, you can think of analytical, and financial planning activity, but in the compliance area, you can also think of serving local legal compliance. We can also go in a technological direction, where engineers are now providing a multi-level service to customers, even doing full machine design and sales activities.
So you need more and more of the workforce - IT people, engineers - where there is already a shortage in the market? How can companies do this? How do they recruit?
It is a serious problem that this sector is less visible, because it is doing back-office activities, and servicing business lines. However, the latter is very visible. For example, if you think of LEGO, everyone knows what LEGO is, because it is tangible, but few people know that they also have a service center that does the activities I mentioned earlier.
Therefore, the priority to start a good recruitment drive is to make the business service sector better known, so that people do not equate it with a call center, even after twenty years.
This is necessary to be able to move into the higher-skilled, knowledge-intensive areas of the industry and attract talent. We need to raise our profile and build our brand. Demonstrate how we can provide a strong career path, absorbing a significant workforce, while providing long-term, predictable and stable employment opportunities for employees, characterized by acceptance, equal opportunities for all and respect for each other through corporate culture.
For example, we can now offer new opportunities to freelancers who have been speaking languages and are preparing for a change due to the kata (small business tax) changes, including translators, interpreters and language teachers. While most of the activities can be learned, language skills are essential. It can be a win-win situation for us to attract staff and for them to have a stable job opportunity with a BSC: a career path, with a wide range of benefits packages and flexible working. And not just for young people! The business services sector is mostly identified with young people, mainly because of language skills, but where this is a given, opportunities are open to other age groups through reskilling and upskilling, or even for career changers.
Are companies in the sector preparing for such training? Is it already underway?
Companies have started to introduce it on their own initiative, but greater cooperation is needed at the sector level. It also needs awareness-raising so that people from completely different backgrounds can see the potential. It also needs to make it easier for employers and potential employees to find each other. Facilitating this is definitely in the ABSL's plans, but we have a lot of work to do to make it a well-established operating model.
I suppose that's why the rebranding is necessary, HOA to ABSL, to shift the focus from shared services, SSCs, to business centers, BSCs, to get rid of the 'call center' identification?
The transition from the Hungarian Outsourcing Association to ABSL primarily means a brand change, which is happening now. ABSL (Association of Business Service Leaders) is now an international environment with international benchmarks and standards. It brings together representatives from eleven countries - Latvia, Poland, Hungary, Austria, Germany, Switzerland, Czech Republic, Bosnia and Herzegovina, Albania, Romania and Moldova, providing an opportunity for international comparison, sharing good practices in the region, learning about international competitors, and providing organized support for companies in the sector.
ABSL's platform provides a platform for building and maintaining relationships, creating opportunities for cooperation within the industry, where partners can engage in local initiatives ranging from branding, and rural development projects, to issues affecting the sector, or even presenting a unified professional content to investors. In the case of a strategic partner, it is also possible to support a specific economic area (e.g. real estate development, digitalization, employer branding, wellbeing...) in a specific and professional way. The organization’s professional background to existing members and newcomers is of particular importance.
What steps do you plan to take in terms of communication, to promote the sector to the wider public and employees?
So far we have reached out to senior managers, they have been our partners. To reach the talented people, we need to approach them in other ways: at universities or even through webinars on legal, HR and other topical issues, round tables to share experiences and practices with the sector.
We also have cooperation initiatives with rural cities and universities, where we aim to provide the city administration and the university with useful information that can create opportunities for a service center to be established in the city. They must know the conditions under which they can attract such investment and retain potential employers and employees in the long term.
ABSL, as a professional organization representing companies in the sector, aims to provide credible information to the wider public that will help businesses and workers to find each other more effectively in the future through better knowledge of the sector.