Convergys: Lessons on Global Networks

Much has been written in recent weeks about the competition between Cincinnati and Northern Kentucky over Convergys, a leading billing, customer and employee care service company currently based in downtown Cincinnati, which is planning to relocate its corporate headquarter operations.

Convergys has been searching for a new corporate headquarters for two years, exploring sites and potential tax breaks on both sides of the Ohio River. In the past month, however, it appears to have settled on a Northern Kentucky site. Convergys plans to invest $100 million to buy and renovate the building, displacing at least five tenants but consolidating much of its Ohio work force, about 1,450 jobs, at the site and adding up to 1,450 new jobs within 15 years.

While Ohio and Kentucky officials will continue to duke it out over who gets the headquarters prize, there is another important lesson to learn from this situation. It is the lesson of global connectivity. Convergys employs over 44,000 people globally and its future growth will be international. Now with over 4,000 employees in India and growing and expanding operations in the Philippines and other world locations, these numbers dwarf the company's Cincinnati area job numbers.

Many communities are focused on developing new businesses and jobs in the FIRE sector (finance, insurance and real estate) and the Business Services sector. It is important to consider the global realities that go with these sectors right now. The major back-office operations in these industries are moving with great speed to developing countries that were given little thought as prime service business locations just five years ago.

While communities here are battling to hold or land the headquarters, the real jobs in terms of numbers will be abroad. The Convergys deal is a reminder to all of us that "global workforce management" is a new reality for economic development. It speaks to the need for new strategic relationships between and among locations worldwide to function as a global network in supporting a company like Convergys. This is the new model of economic development coming our way.

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