Teleperformance SE SWOT and PESTLE Analysis

Strength

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Weakness

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Opportunity

1. Expand its market in retail & e-commerce segment with the growing demand: The global CX management market, including both insourced and outsourced services, was valued at approximately US$350-370 billion in 2022, showing steady growth from around US$280-300 billion in 2010. This is due to the increasing number of omnichannel interactions between consumers and brands, as well as between citizens and government agencies. The proliferation of mobile devices like smartphones and tablets has facilitated instant connections between consumers and brands, driving the demand for CX management services. The rise of non-voice interaction channels such as email, social media, messaging, and chat has also contributed to double-digit annual growth in the industry. Furthermore, the expansion of online services, including IoT, cloud services, and the metaverse, has created new needs in various sectors, particularly retail, e-commerce, and leisure. This trend presents an opportunity for Teleperformance to expand its market presence in these segments.

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Threat

1. Operating in the industry with a high employee attrition rate: The sector in which Teleperformance operates experiences a high rate of employee turnover. According to the COPC industry standard, the average annual staff attrition rate for agent positions is 87%. This is because many employees are freshers. However, Teleperformance has managed to maintain an attrition rate below the industry average. For agents, who make up approximately 80% of the total workforce, the average attrition rate is 6.9% per month or 82.8% per year. The attrition rate for supervisors, support, and management functions ranges from 2% to 3% per month. Globally, the company's average attrition rate in 2022 was 6.4% per month or 76.5% per year. The firm is committed to further reducing attrition, especially during the initial months of employment. This includes continuous improvement of the hiring process to identify individuals who are likely to thrive in their roles, regular employee satisfaction surveys at key career stages, and the establishment of a retention team to conduct exit interviews and find solutions to retain talent whenever possible.

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Political

1. Border closures by China & Russia-Ukraine war induced uncertainty in visa application management services: The visa application service market has faced significant challenges since 2020 due to the Covid-19 pandemic's impact on international travel. TLS contact mainly serves governments in the Schengen area and the UK, handling around 41 million visa applications per year, with a value of over €1 billion. However, the market's growth has become uncertain due to health and geopolitical crises. In 2022, the closure of China's borders and the war in Ukraine further affected travel. Nevertheless, global organizations such as the UNWTO, World Economic Forum, and IATA project a gradual recovery in air travel in 2023, although passenger numbers may remain slightly below 2019 levels. The revival of visa applications depends on the return of Chinese travelers and the resolution of the Ukraine war. Conservative estimates by IATA suggest that the outsourced visa application management market may not fully recover until 2024. However, the company successfully restored its pre-pandemic business levels by 2022.

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Economic

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Social

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Technological

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Legal

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Environmental

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