Witness questioned about SriLankan Airlines call centre established in 2010

The Presidential Commission of Inquiry (PCoI) appointed to investigate irregularities at SriLankan Airlines (SLA), SriLankan Catering and Mihin Lanka yesterday questioned the General Manager of Commercial and Support Services Duminda Weeraratne on issues relating to the SLA call centre which was established in 2010.

The SLA customer services were conducted by its Telephone Sales Operation Unit from 1990. But in 2009, the SLA called for bids from the venders to set up a fully outsourced call centre for three years. Apart from boosting its service excellence, the SLA also expected a 50 percent reduction of staff of the call centre within the three years period. It was also expected to save an amount of Rs. 77 Million of the cost of the call centre after three years.

When questioned, the witness told the Commission that he is unaware as to whether there was a decision from the senior management to set up a call centre outsourcing the services.

He said but, a Technical Evaluation Committee (TEC) was appointed for that purpose and he was also a member of it. According to his knowledge, no feasibility study has also been carried out in this regard. It was also revealed that there was no such requirement to set up call centre in the SLA Strategic Business Plan (SBP) prepared for the financial years 2010/11 to 2014/15.

However, the TEC had developed a Request for Proposal (RFP) to select a service provider that has local and international experience. Upon receiving, 10 venders had responded to this RFP.

Later, the TEC based on five key areas of the RFP has shortlisted five venders at the first round. Before the second round, the TEC members had visited the Emirates call center and also had a video conference to study the Etihad call center. After that, at the second round, the selected companies were further shortlisted based on a revised implementation plans and finally, two companies namely HelloCorp Pvt. Ltd. and Scicom Lanka Pvt. Ltd. had got higher marks.

These revised plans are not in the RFP, the witness told the commission. Later, the HelloCorp teamed up with an Indian Company ‘IGT’ and the Scicom teamed up with a local company ‘Just-in-Time’ as their ICT service providers.

According to the witness, the Scicom Company is an internationally recognised one for such services, but only in low-cost carriers such as AirAsia.

The low-cost carriers have no complexity that airlines like SriLankan have, he added. But, the HelloCorp has expertise in classic travelling and cargo services. The cost of HelloCorp for the three-year period which they agreed at the financial negotiation was Rs. 473 million and the cost of the Scicom was only Rs. 445 Million.

However, despite the cost which is higher than six percent to the Scicom, the contract has been granted to the HelloCorp in the year 2009 on the merit basis.

The main duty of the selected service provider was to maintain Key Performance Indicators (KPIs) and the Customer’s Satisfaction. The witness told that despite of outsourcing, the SLA had some control of the call center in terms of quality.

When asked, whether there was an expected reduction of staff after three years, the witness told that there was no conclusion as to how the reduction came about and also he has no details to say whether it was successful. He said he couldn’t find documents to prove whether the anticipated cost of Rs.77 million could be saved as well.

The Commission also inquired from him regarding an addendum dated July 15, 2013 attached to the original agreement which mentions about paying incentives to the staff which was not in the RFP. It has been signed by the Chief Marketing Officer pf SLA and the CEO of the HelloCorp to grant incentives for the staff from March 1, 2012.

The witness said that he couldn’t find any document to prove whether the approval of the Board of Directors has been granted for this addendum. The procurement Manual of the SLA also has not been followed in granting these incentives, it was revealed. Another addendum to the original agreement had further advanced the date of paying incentives to the staff till October 1, 2011.

The Commission also inquired about paying an additional payment of Rs.185,000 per month for the Full Time Employees, who are fluent in Mandarin. He said that he didn’t know on which basis they were paid this amount and it was also not in the TEC report.But, according to him, this should be due to the business requirement which had arisen at that time. The Chief Marketing Officer had signed to authorise this payment.

It was also revealed before the Commission that the fully outsourced call centre was physically set up in September 2009. But, the contract agreement between HelloCorp and the SLA had been signed on June 16, 2011 about 10 months after the setting up of the call center. He said that he couldn’t find even a contract review for this agreement.

The agreement with HelloCorp was concluded in September 2013 after three years. However, according to the provisions of the agreement in 2013, the agreement had been extended for a period of another three years. He said that he could not find any details whether any evaluation was carried out before the renewal of the agreement, but, the approval of the Board of Directors was received for that.

 

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