Focus on Curiosity, Creativity and Complex Problem-solving Skills
The business services sector (covering business process outsourcing (BPOs) and business Services centers, or BSCs) has become one of the fastest growing areas of the Hungarian economy, attracting a high level of investment into the country, the Hungarian Investment Promotion Agency tells the Budapest Business Journal.
The importance of the sector is shown by the fact that more than 55,000 employees are working at 120 business service centers in Hungary. The number of negotiated BSC projects by the Hungarian Investment Promotion Agency (HIPA) was 10 during 2018. As a result of these projects, 1,243 jobs will be created in Hungary. During this year, several new centers were opened and significant R&D centers were established with the support of HIPA.
When it comes to the BSC industry and R&D centers, Hungary has moved up the value chain. There is a clear trend that companies are increasing the number of high value add positions and are implementing digitalization. Moreover, BSCs plan to expand in the short-term in Budapest and also in countryside locations, therefore the spread of robotics does not result in downsizing.
The skills and competences of the local talent pool contribute significantly to the expansion of the centers in Hungary. As technology and automation will continue to take on more repetitive processes, increased emphasis will be placed on human resources with qualities and skills such as curiosity, creativity and complex problem-solving.
Engaging new talents, training employees and retaining people are key for the centers. The number of employees in the sector is increasing every year and the availability of skilled labor is the major factor in considering Hungary as a preferred location.
As the use of data analytics and automation becomes extensive in this field, employee skill sets are also likely to undergo change. Specialist roles such as data analyst, finance analyst, and software engineer are rising. There is an increasing demand from the companies to find colleagues with advanced skills in data management, data forensics, design thinking and behavioral science.
There are significant market players in Hungary sending strong signals to the BSC sector as they are developing their existing activities by adding business services of R&D to their operations. French multinational pharma Sanofi considers its new office in Budapest not as a simple BSC, but a Center of Excellence (see separate box).
Swiss multinational healthcare company Roche first opted for Hungary in 2006, choosing Budapest for its service center providing financial, HR, and IT support. This year, Roche selected Hungary as the location for its first Center for European Pharmacovigilance (PV HUB). The PV HUB to be established in Budaörs will be the largest such office of its kind for the global biotechnology company, and will analyze the medicine safety-related data of the Roche pharmaceutical products, creating 25 high added value jobs.
BP’s unit in Budapest, belonging to Global Business Services (GBS) Europe’s one of the first GBS offices, was established in 2009. Taking the successful operation in the capital as a basis, BP’s second office in Hungary was launched in Szeged, at a renovated and reconstructed textile factory in 2017. The new center planned to reach a staff of 500 employees by 2020, but that was already achieved this year.
Taking the number of employees into consideration, these two locations raise Hungary to the group of the five most important countries within BP, and puts Szeged in the ten most important cities within the company. BP provides services in 16 languages in the fields of finance, accounting, procurement, and tax, as well as HR- and commerce-related support and customer service.
Tools and Mechanisms
HIPA provides management consultancy services for investors and prospective investors not only during planning and preparations but also in the phase of implementation and operation. The agency puts a great emphasis on continuous communication with and feedback from the representatives of the BSCs, but it also has incentives to offer.
In the case of an investment resulting in the creation or expansion of a business service center, creating at least 50 new jobs in the countryside, a non-refundable VIP cash incentive can be provided, based on an individual government decision.
There are different tools and mechanisms to support innovation and R&D activity in Hungary as well. Non-refundable VIP cash subsidies for R&D projects are available in Budapest and countryside. The aim here is to enhance the R&D activity of large enterprises and the creation or expansion of R&D competence centers in Hungary.
HIPA welcomes and supports the new initiatives of the BSC sector in Hungary. Together with Hungarian embassies and consulates in Germany, the Netherlands, the United Kingdom and the Unites States, HIPA has organized career networking events with a special focus on helping companies to reach out a previously untapped potential workforce, Hungarians living abroad.
These events enable companies to contact young professionals and students who are considering or actively looking for job opportunities in Hungary. The first event was initiated by BlackRock, a company that has attracted more than 12% of their workforce from abroad. During 2020, new events will be announced and new locations added to the series.
The BSS Attractiveness Forum, an industry-cooperation on sector branding, has been launched by AmCham Hungary. (Editor’s note, more on this, see Pages 20-21.)
On a regional level, the results and achievements of the “Debrecen Business Service Centers Roundtable” should also be highlighted. Seven companies are working in close cooperation in order to define and develop educational paths for the sector and to raise public awareness of these opportunities. Currently, the Debrecen BSC Roundtable is working on the accreditation process for business services training for secondary school teachers together with the University of Debrecen.
On November 28, the HIPA-HOA (Hungarian Outsourcing Association) Business Services Hungary 2019 Conference will demonstrate the latest trends of the sector and BSC cooperation platforms in Hungary as well as the results of the latest industry survey.
Latest: Tesco Business Services & Technology Center
Tesco Business Services & Technology was established in Budapest this year and started running its first live operations in March. The hub will support Tesco’s businesses in Hungary, Czech Republic, Poland and Slovakia by providing key processes with improved efficiency, accuracy and standardization across markets. Meanwhile, the technology team will work on global tech development projects. The office has grown to 200 colleagues already, currently supporting payroll, HR administration, supplier management, helpdesk and technology. Tesco will continue to ramp up recruitment for business services and technology roles during 2020 as more work is transitioned to the hub.
Latest: Sanofi Business Services Budapest
Sanofi Business Services in Budapest serves subsidiaries in Europe and North-America in seven languages. The new business unit announced this year starts its operation with a staff of more than 100 professionals working on support activities in the field of HR and finance, but Sanofi plans to hire a total of 350 people by the end of 2022. Sanofi Business Services will drive value creation to allow its business divisions to focus on core competencies and the best way to get healthcare to patients faster.
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