Cincinnati-Based Convergys Hangs Out Help Wanted Sign: Adds 500 New Jobs In Costa Rica, Apply At Bldg. 3, Barreal de Heredia

Convergys Puts Another Call Center in Cost Rica  

CINCINNATI (TDB) -- Offshore and outsourced telephone calls getting under your skin when you try to straighten out a bill, or get help with a product.  There's more of that coming your way from Cincinnati-based Convergys Corp., which soon will have 1,600 people working the phones from call centers in Costa Rica in Central America.  The expansion has been big news in Central America, but hardly noticed in Cincinnati, where the mainstream media hasn't mentioned the latest outsourcing operation. The president of Costa Rica, Laura Chinchilla Miranda, left the capital in San Jose to dedicate Convergys' newest addition earlier this week. She toured the production floor in tow with two top Convergys' execs.  Here's a brief press release from the Costa Rican trade development board, which says the new hires will handle transactions and take calls in English.

The Cincinnati company -- which has taken economic development aid from officials in its hometown -- set up shop in Costa Rica in March 2009. It now has three facilities there. Call Centre Clinic, an industry trade publication, says Convergys is growing:

"Once this third site is fully staffed, Convergys will employ over 1,600 talented employees in Costa Rica. Convergys will employ over 500 individuals in the new 35,000 square foot Convergys Costa Rica III contact center. Six training rooms will help ensure that employees are well prepared to provide superior customer experiences to the customers of Convergys’ clients."

Christine Timmons Barry, a senior V.P. with the Cincinnati company, said Costa Ricans are bilingual, which means that customer care calls can go back to America, where most people speak English. She didn't say what the Costa Ricans are being paid -- probably far less than U.S. workers would earn. So cheap labor may be behind the interest in Costa Rica's labor pool. Said Timmons Barry:

"Our clients appreciate the high quality bilingual customer care we offer from Costa Rica, and it is client demand that is fueling our continued growth here. Costa Rica boasts a highly-educated, dedicated, bilingual population that shares a strong cultural empathy with our client’s customers. The opening of this new facility will help ensure that Convergys continues to meet our global clients’ current and future need to provide superior customer experiences.”

In the Land Of Cincinnati CEOs: Who's Next After Convergys Chief Is Shown The Door?

By Harry Callahan
Special to The Daily Bellwether

CINCINNATI (TDB) -- On most professional sports teams, three years of futility is usually enough for owners to throw in the towel and dump their managers. Not so in Corporate America. CEOs stay put for years and years even as their products disappoint, their service stinks, their business fortunes tank and their stock prices plunge. Just look at Joel Gemunder, CEO of Omnicare in Covington. Over nearly 30 years, Gemunder built Omnicare into the nation's biggest supplier of meds to nursing home patients, but he lost his Midas touch quite a long time ago. Omnicare's stock was worth $62.50 a share toward the end of 2005. It closed Tuesday at $25. Investors unlucky to have held it all that time lost 60 percent of their money.

How refreshing it is, then, to see another local corporation demonstrate that the buck truly stops on the desk of the CEO. Convergys Corp.'s stock traded for $26.38 when David Dougherty was promoted to CEO on April 17, 2007. Convergys is a major player in doing mundane, so-called "back office" functions like payroll and customer service for client companies, and Dougherty made out as its boss, earning $10 million in compensation between 2006 and 2008. But Convergys was stinking up the place, reporting net losses of $155 million over a 21-month span, even as rival Genpact was making money. The stock was languishing below $11 on Tuesday. The next morning, Dougherty went from CEO to mere consultant, if not an undoubtedly well-paid one. We'll know soon how big a sendoff gift he got.

One has to wonder how impatient shareholders of other big corporations have gotten with their underwhelming CEOs, like Omnicare and Cintas Corp. Cintas shares were worth $35.31 the day Scott Farmer took the CEO reins from his dad Phil Farmer. Going on seven years later, the uniform and industrial sundries maker's stock trades for less than $25, a drop of 30 percent. And that's through good times and bad.

Convergys Jobs In Cincinnati: City Says Average Wage Is $100,000 Per Employee

CINCINNATI (TDB) -- Cincinnati City Manager Milton Dohoney Jr., reports in a memo to the mayor and council that Convergys Corp.'s (NYSE:CVG) downtown headquarters' payroll averaged "more than $100,000 per employee" in 2007. The company handles outsourced billing, customer care and human resources for corporate clients. Convergys had about 1,450 workers when it made a deal with the city in 2003 to remain downtown -- now it has about 1,471 (33 are part-time) -- amid reports it would add some 1,225 new jobs over a 12-year period. The memo indicates the company is falling short of the jobs creation goals. The memo is marked as number "1847" and can be tracked down on Cincinnati's e-gov online portal. The Daily Bellwether, however, will quote its entirety:

"The Economic Development Division has received the 2007 Annual report from Convergys relative to the Agreement for the Creation and Retention of Jobs, executed July 25, 2003. The report indicates that:

1) Convergys, as of December 31, 2007, employed 1,438 full-time and 33 part-time employees, for a total of 1,471 employees.
2) In 2007, the average annual wage of the 1,438 full-time employees was more than $100,000 per employee. The aggregate payroll for the 1,471 total employees was over $146,000,000; generating Earning Tax Revenues for the City in excess of $3,000,000.
3) Convergys exceeded their commitment of $100,000,000 of capital investment, as required by our agreement, by investing more than $166,000,000 in capital expenditures to date.
4) Small Business Enterprises (SBE) have been utilized for more than 30% of the expenditures related to renovation of the Atrium I building.

As indicated in the reports, Convergys had no net new employees for the Tax Year 2007; and therefore is not eligible for -- nor claiming -- any Job Creating Tax Credit for 2007. Therefore, Convergys is currently in compliance with the job creation terms of the Agreement, and payroll and capital investment significantly exceeded previous projections."

The Enquirer's Greg Korte was on the City Hall beat in July 2003 when the deal was struck to keep Convergys from moving to Northern Kentucky. While the jobs creation portion doesn't seem to have worked out, other parts of the bargain -- the earnings taxes and investments -- appear to have benefited Cincinnati.