Serco’s 500 job cuts announced earlier this week (see here) in management and back office support functions, are to be meted out mostly across its UK head office in Hook according to the BBC (see here). This number accounts for c1.4% of Serco’s current UK workforce of 35,000.
The news coincides with Serco’s launch of its ‘global BPO’ operation created out of the amalgamation of its recent acquisitions of offshore BPO provider Intelenet Global Services (see Serco’s expensive offshore gamble), UK-based call centre provider The Listening Company (see Serco acquires UK contact centre provider), and Australia-based contact centre provider Excelior last November. These deals together add a total of 37,200 people into Serco’s new global BPO operation mostly based out of India. However there will also be an additional 4,300 people in the UK from TLC and Intelenet.
One of the keys to running a successful BPO operation has to be to ‘take your own medicine’, so it makes sense for Serco to plug its own back office services into this new BPO capability. In fact till now, Serco has had to partner with BPO providers for certain internal back office administration (see Serco renews BPO deal with Genpact), which really exposed a weakness in its delivery model. This shift will inevitably involve cost cutting. But retraining and redeploying staff elsewhere could minimise the impact of job losses.
As Serco moves forwards with its ‘global BPO’ plan, it mustn’t lose sight of the experience and skills that it has built up in its core UK market.