Japanese dialing up Dalian call centers

DALIAN, China – Dozens of young men and women sit in rows facing computers and talking into their headset microphones, filling the large room with a soft buzz.

“Thank you for buying our product,” one woman says. “Is there a problem?” asks another.

The language spoken is Japanese, and the scene could be from any call center in Tokyo, Osaka or Fukuoka. But it’s not. The operators are in the northeastern Chinese city of Dalian.

“The demands of our clients were to provide our services at lower fees,” said Shinichi Motoyama, director at Livedoor Communications Co., who is in charge of the company’s call center in Dalian.

“Here, we can cut costs by 40 percent of what they are in Japan. It makes sense.”

In Japan, call centers — where consumers call when they have questions about or problems with the products they buy — were initially set up in big cities.

Then they moved out to rural areas, where costs were lower. But in recent years, some of them have moved to this Chinese port city, where personnel costs are a quarter of what they are in Japan.

In Livedoor’s case, operations began in May 2004 for the company’s financial services sector. It has since expanded. Now the call center provides its services to several other IT-related companies.

But why Dalian?

“Dalian has several beneficial aspects for Japan-targeted services apart from the lower personnel costs,” said Shintaro Mine, general management director of Japan External Trade Organization’s Dalian office.

The physical proximity to Japan — a three-hour flight from Tokyo — and relatively large number of Japanese speakers due to the city’s historical links with the country make it an attractive spot for services for Japanese clients, Mine said.

Dalian was the port city of the early 20th century Japanese puppet state of Manchukuo.

While Japan’s colonial rule may not be a fond memory, a large number of students choose to study Japanese, lured in part by the prospect of employment opportunities at Japanese firms that have set up offices in the city.

Some call centers have already tapped into the Japanese-speaking population in Dalian, but others have chosen not to.

Those who have not cite the trickiness of the business. Angry Japanese consumers call without any inkling that their calls are being connected to Dalian. A small mistake, including the use of honorific terms, could create misunderstandings and even arguments.

So instead of employing Japanese-speaking Chinese, Livedoor has created an internship program through which it recruits Japanese youths in Japan, and employs them at roughly the same salary as Chinese operators — an hourly pay of 20 yuan, or 160 yen.

The attraction for the young Japanese, Livedoor says, is a chance to live in China and to attend Chinese-language lessons paid for by the company.

“The money is enough to live here,” said 22-year-old Rie Tagawa, who began working in Livedoor’s Dalian call center earlier this year after graduating from a prestigious Tokyo university.

“I thought joining this program would give me time to think about what I really wanted to do with my life and provide me with a real working experience at the same time.”

Tokyo-based Masterpiece Inc., which provides various administrative support services for its client companies, has also been employing people like Tagawa at its call center, which began operations in 2003. What began as a two-operator service has now grown into one involving 50, all Japanese nationals. The center receives 2,000 calls a day.

“Some of our people are employed in Japan, some here, for example exchange students,” said Juri Nakajima, director of MPC (Dalian) Marketing Consulting Co., which operates the call center.

JETRO’s Mine said one of the reasons this system works is the still-high unemployment rate in Japan. He also said that if the trend grows, it could have possible implications on Japan’s competitiveness in the global stage.

“Japan should be making efforts in the high-technology sector” to compete with countries like China, Mine said. “Employing Japanese youths in this way could lead to issues with Japan’s competitiveness.”

Multinational firms are also keen to take advantage of the Japanese-speaking Chinese in Dalian, instead of hiring only native Japanese speakers.

Hewlett-Packard Co. has set up a call center in Dalian that has begun operations for Japan and will eventually cover all of Northeast Asia.

The call center’s operators for its Japanese service are a combination of native and nonnative speakers.

The model will be followed for its services for South Korea, which will be covered by people from that country as well as ethnic Koreans in China, said Liu Hua, deputy general manager of the center.

Liu believes Dalian could be for Northeast Asia what India’s Bangalore is for the United States in terms of back-office outsourcing.

“We are learning from Bangalore,” Liu said, referring to the city which is a hub for outsourcing centers for overseas companies. “Our ambition is also very large. We will be better than Bangalore.”