Click BPO for a Great Job - BPO NEWS

Ronald George is with HR Operations, 24/7 Customer. He had a fast-track growth in the company in a span of seven years. Now with HR, his mandate is to make the fresh recruits feel at home. He speaks to ET on the opportunities in the sector.

Can you give a brief overview of your career?

I started my career with 24/7 Customer in March 2001 and it has been more than 7 years since I’m with them. I began as an agent in operations and spent 1.3 years in this role and moved on to become a team leader managing 20 agents. After working for 1.6 years as a team leader, I was promoted as manager (operations) handling 7 team leaders.

I worked for 2.5 years as manager and was promoted as assistant program manager managing approximately 500 employees. After spending a year in that position, I moved laterally to the support function as manager, HR Operations. When I joined 24/7 Customer, it was a young company which was growing and I thought this was the best place where I could get immense opportunities to learn and grow.

The BPO industry is hailed as a sector enabling youngsters to have fast-track careers, with higher levels of responsibility being delegated at fairly early stages in their careers. What are the growth prospects available for people looking at a career in this sector?
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Honing BPO skills - BPO NEWS

Getting the right talent to work for you, is like searching for the proverbial needle in the haystack. Who would know this better than BPO firm 24/7 Customer? The company has initiated several programmes as part of its corporate social responsibility initiatives to expand the base of professionals in the BPO industry.

Recent research and studies have shown that the BPO sector is going to face a talent shortage of about 262,000 professionals by 2012. Keeping this in mind, the company has chalked out CSR programmes which focus on empowering youth, providing them with equal opportunties and educating the underprivileged.

Take its 24/7 Ascend programme, for instance. Under this initiative, students are taught the skillsets needed for the BPO sector. The website www.247customer.com/ascend helps any student get free information on skills needed to join the BPO Industry.

They also have a career opportunity programme wherein common doubts that college students have in pursuing a career in the BPO industry are addressed. To improve the skillsets, courses on language/communication are provided and special study courses are also taken up. Career planning tools like interview tips, resume writing lessons, counselling on BPO careers and scholarship information are also offered.
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Indian BPOs may lose Orange pie

NEW DELHI: Business process outsourcing (BPO) companies like 24/7 Customer , Convergys and EXL Service may be impacted post Orange UK’s announcement of job cuts and reduction in the telecom major’s reliance on India based call centres.

Orange, the mobile services arm of France Telecom, is amongst the largest cellular players in the world. Orange’s new UK CEO Tom Alexander, while announcing a cut of 450 middle management jobs this week, also announced a change of strategy: Reduce its dependence on its Indian call centres, where the company directly employs about 1,500 executives. The company has not clarified as to how many of the 450 job cuts will be from its Indian operation. The immediate impact of the move is that Orange will be halting its call centre expansion in India.

In the next stage, the company will gradually bring ‘back home’ its call centres to the UK, in a bid to sell British customer service as the heart of its new strategy. It’s likely that the employees working on Orange UK’s Indian call centres will be redeployed in other processes over a period of time.
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Banking Services: Providing IT and BPO Services to Banks

Banks continue to use technology intensively to trim costs and increase revenues. Apart from economic conditions, regulatory issues, competitive pressures and changing customer needs that have contributed to the changes of the sector, technology has truly revolutionized the industry. In today's competitive scenario, banks can still improve their performance and bottom lines by carefully allocating technology funds for measurable returns on investment.

Hexaware focuses on providing IT and business process outsourcing (BPO) services to banks across the world. Explore Hexaware's key projects and features as well as market trends that have translated into large outsourcing engagements, including the restructuring of core leasing applications as well as the development and support of mission critical systems.

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BPO firms confident of beating US recession

At the concluding session of Nasscom's BPO Strategy Summit in Bangalore recently, 24/7 Customer's co-founder S Nagarajan made an unusual and passionate plea. He asked the large audience to write letters to newspapers whenever they found articles that portrayed the BPO industry in a negative light. "If you have different experiences from that stated in the articles, you should all write to the editors concerned," he said.

The reference was clearly to articles that have highlighted issues like sex and drugs at the workplace, much of that said to be provoked by the young age of those who work in such jobs, and the fact that most BPO jobs involve working through the night. We won't get into the merits of that here. But the reason Nagarajan was provoked to make that statement was this: He believes those articles are exaggerated, and, more importantly, he believes if there is anything that can put the brakes on the industry's growth, it's people's belief that BPOs aren't 'good' places to work in. Parents will discourage their children from entering the profession. In short, the industry won't get the talent it requires.

That's certainly not good for Nagarajan's firm, and especially now when the industry believes it's at the threshold of super-growth. While most admit that the coming year will see a slowdown on account of what looks like an inevitable recession in the US, the country from where most offshoring work comes, the industry's medium term projections are likely to beat that of most businesses. A study conducted this year by Nasscom and research firm Everest estimates "conservatively" that between 2008 and 2012, the industry will see a compounded annual growth rate (CAGR) of 28-30%. But it believes this could go up to as high as 45-50 % if supply constraints are eased.

"Supply is the constraint, not demand," says Pramod Bhasin, CEO of one of India's biggest BPO companies Genpact. India, he says, is already creating the biggest pool of business reengineering talent in the world and is fast consolidating its position as the No. 1 BPO destination. So anybody anywhere looking to outsource their non core areas is likely to look first to Indian BPO companies. In fact, Bhasin would perhaps be unhappy that we continue to use the term BPO to describe his firm. He thinks that given the specialized expertise companies are moving towards, the generic term is no longer meaningful.

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BPOs grapple with inflation

IT-BPO firms, which are already facing a US slowdown and currency fluctuations, are now busy in firming up their plans to tackle a rising inflation in the country and its impact on salary, sales, general and administrative (SG&A) and travel costs, which can dent their profit margins.

According to analysts, the immediate impact of a rising inflation would be on salary. Avinash Vashishta, Tholons Investment Advisory Research, said: "Salaries will now have to be hiked by more than what the companies had decided. Last year, there was almost a 15 per cent rise in salary, while this year it may go up by 8-9 per cent."

Most companies, including India's largest IT services provider Tata Consultancy Services (TCS), Infosys and Satyam , implemented their annual wage hike in the first quarter of the financial year beginning April 1. Others such as Wipro do it during the year. If inflation continues throughout the year the firms would have to effect a mid-term hike or raise the salary by a good measure in the next financial year.

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Business Process Outsourcing 2008: The Year Ahead

The sub-prime mortgage crisis and the weakening of the US Dollar have rendered several rude shocks to the outsourcing industry in 2007. Indian companies were especially hit as the Rupee appreciated by 10.9% in the last 12 months (14.2% in the last 15 months) against the US Dollar. Investors, analysts and the media have been speculating about the impact of margin pressures, risk of business loss in the US, further Rupee appreciation coupled with domestic inflation, etc. This will continue through 2008, as we watch the US slowdown play out – much depends on the extent of the slowdown (will it become a full-blown recession?).

Interestingly, despite worries on the margin front, outsourcing growth expectations stand tall. In our interaction with vendors across the outsourcing spectrum (IT, BPO and KPO), optimism is the prevailing mood, especially as concerns top-line growth. As a result, companies are gearing up to face the year with aggressive plans coupled with some innovative strategies to fight margin pressures. Either way, 2008 promises to provide plenty of action for the outsourcing industry. Our analysts have put together a list of key trends that we believe will make an impact in 2008.

1. Shake-up likely as smaller un-differentiated BPOs will be badly hit
Smaller BPOs with low-end, commoditized services are worst affected by margin pressures, and the worst is far from over. These players will find it difficult to raise prices, and will be unable to pay enough to retain the best talent. Small Indian vendors will be forced to innovate with a focus on "differentiating" their services. In 2008, we believe that this will become critical not just for sustaining competitiveness but also for the very survival of smaller vendors. The vendors that succeed in differentiating their offerings and thereby climb higher up the value chain, will see new growth or exit options open up via better access to funding and M&A activity by larger players. The others, who are unable to get out of the low-price, low-cost game, will start fading away from the competitive landscape.

2. Rigorous cost cutting by vendors inevitable in 2008
The larger companies may hedge forex exposures in the near term, but cannot disregard the threat of lower competitiveness in the long run. Large global vendors and focused, niche providers may be able to raise billing rates, but this will not compensate for the entire exchange loss, and will need a parallel productivity increase to prevent margins from weakening further.

Cost rationalization will be inevitable in 2008 for Indian vendors – whether small or large! The most obvious impact will be on wage hikes and executive perks. Recruitment too is expected to slow down marginally until mid-2008, as vendors push up utilization rates aggressively. But we expect recruitment to pick up again in the latter half of the year as the slack gets wrung out. The impact on attrition rates will also be interesting to see, as large premiums on poaching may no longer be affordable.

Apart from the obvious cost heads, companies will also look to optimize various administrative or marketing costs. Traditionally, the weak Rupee has meant that margins were never threatened for Indian IT and BPO service providers. This has led to considerable slack, in areas like transport costs, procurement, travel, telecom, etc. In the past, management attention was focused only on growth, but now, the quality of growth will matter more.

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Designing Your Organization for BPO and Shared Services

This article provides guidance on organizational design (OD) for organizations that are undertaking or contemplating a shared service or business process outsourcing (BPO) initiative. It comes from the series, "Guidelines for Shared Services and BPO," developed by Alsbridge to reflect a shared understanding of good practice in outsourcing. Related columns will discuss the following areas: developing a business case, change management and SLAs and service levels, charging and benchmarking.

Organizational design is sometimes used to mean simply the design of an organization chart. However, this article uses a broader definition which covers the operating model, the organizational structure (including the organization chart), the roles, competencies and job descriptions.

For shared services and BPO the model has three main areas, as follows:

• The service management organization is the shared services/BPO operation itself, undertaking the various transaction processing or administrative activities. Some shared services/BPO operations will deliver specialist and expert services. This organization may be an internal shared service center, serving one or many internal customers, or external, which is typically the outsourced/BPO option.
• The retained organization is the term used to describe what is left behind when the shared services or outsourced activities are transferred to the new service provider. There are two aspects to the design of the retained function. First there is a need to design an organization that is effective in "receiving" the service delivered by the shared service/BPO provider. This will require an organization where there is clarity of responsibility for inputs and outputs to and from the provider. Second, there is a need to design a retained organization that is effective in performing its role in supporting the business.
• The governance layer term refers to the activities that are necessary to manage a customer/supplier relationship, including the management of service level agreements, performance reporting, billing, and issue resolution.

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Is Mysore becoming the next BPO capital?

Think IT, think South India. Bangalore, Chennai and Hyderabad have seen unprecedented growth in the last decade owing to the growth of the information technology sector. But, could Bangalore be 'Bangalored' by its own neighboring town? Could Vijayawada or Madurai be the next BPO boomtowns?

Mysore is known as much as for Mysore Pak as it is known for Brindavan Gardens and the Chamundi Hills. This sleepy city has been witnessing a quiet IT revolution since 2003.

According to a NASSCOM - A.T Kearney study, Mysore is all set to breakout into the big league on the BPO scene because of availability of talent and the city’s proximity to Bangalore. So, while the big firms like Infosys, Wipro and HCL are setting up big global trading and delivery centers here, it’s the smaller firms that are actually able to dig in their heels into the local talent pool.

HTMT Global Solutions is one of the first BPO companies is to set-up shop in Mysore. Benjamin Franklin, the Deputy GM at HTMT tells that the 250-seater facility is far exceeding his expectations. Set-up just 1.5 years ago, it has seen some of it’s first employees now become team leaders. The response from the city has been so good that HTMT is already looking to expand by over 500-seats.

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New BPO service on the offing

Insurers in Europe and the United States are increasingly considering policy administration business process outsourcing BPO, says a new report by London based independent market analyst . Facing challenging market conditions, both life and non life insurers are seeking to reduce costs and gain flexibility. Often times, however, these goals are stymied by rigid policy administration platforms, which are frequently built in house, Datamonitors report states.

The report concludes that insurers need to reduce costs and become more efficient in order to protect profit margins during this and future soft markets. Further, insurers in the mature markets of North America and Western Europe that are struggling to find new pockets of growth need a flexible policy administration system that enables quicker time-to-market. Policy administration BPO can effectively increase efficiency and flexibility, as well as free resources that can then be expended on value-add functions, according to the research group.

Insurers are increasingly targeting the policy administration function to improve their competitiveness, says Jonathan Steiman, a financial services technology analyst with Datamonitor and the reports author. Business process outsourcing, which is often less capital intensive and less time consuming than other options, is being considered by more and more insurers.

Steiman warns, however, that along with the benefits come some risks. Outsourcing the policy administration function can greatly improve an insurers operation, which is imperative in todays market, but insurers are still wary of losing control of the customer and becoming over-dependant on a single vendor. Many of these risks, Steiman adds, can be mitigated with a comprehensive service-level agreement SLA.

Datamonitor's report notes that both large and small insurers will adopt BPO. Currently, insurers with fewer than 5,000 employees currently have the lowest policy administration BPO adoption rate, however, this is likely to change. According to a Datamonitor survey of 200 global insurers conducted in the first quarter of 2008, small insurers are heavily weighing a BPO strategy, which is evidence of the need to lower costs and concentrate limited resources on value-add functions in today's competitive marketplace.

The survey also found that large insurers those with more than 20,000 employees are increasingly likely to outsource policy administration. Typically, these players engaged in off-shoring via captives, or company owned facilities. The captive route has not been as fruitful as expected, elevating their interest in outsourcing to a third party.

The trends captured by our survey are incredibly interesting, notes Steiman. On the one hand, we see small insurers looking to outsource in order to improve competitiveness. On the other hand, we see large insurers, many of whom already having gone overseas with captives, being drawn to outsourcing because of the maturity and expertise that BPO providers now possess.

Many of today's BPO arrangements can be classified as traditional, or your mess for less, BPO. In other words, insurers look to BPO providers to perform the same functions on the same platforms, but for less money. The savings in traditional BPO are typically driven by moving the process offshore to low-wage countries.

Source : http://www.offshoringtimes.com/

Infosys BPO, i-mint tie up for employee rewards programme

BANGALORE: Infosys BPO, the business process outsourcing subsidiary of Infosys Technologies and i-mint, India's first multi-partner consumer rewards programme, have partnered to launch the i-mint-Infosys employee reward programme for Infosys BPO employees.

The programme would be launched with a Infosys co branded i-mint card.

The program would add considerable value to Infosys' employees, who would for the first time receive i-mint points as rewards and can also earn points across the i-mint network of partners such as Airtel, HPCL, Air India, ICICI Bank, Lifestyle, Makemytrip.com among others.

The employees can redeem their points from the vast i-mint rewards catalogue on www.imintpoints.com.

About the launch Amitabh Chaudhry, CEO and MD, Infosys BPO said, "Infosys BPO is the Employer of Choice where careers are build and this initiative further validates our best people practices making it a Great Place to Work for".
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Infosys hopes to recreate the software magic with BPO

Infosys has come late to the BPO space but now the company is making all the right moves to scale up fast.

Amitabh Choudhary, CEO of Infosys BPO, has set a steep target of $1 billion in revenue in three years, which is four times its current revenue.

Infosys BPO is growing exponentially at 70 per cent every year, a stark contrast to its IT business growing at 20 per cent.

According to Choudhary, the management has realised that it is important to have an IT and BPO pay together to expand.

But growth alone will not be enough to log in to the billion-dollar league, so Infosys will have to buy more companies like Philips BPO that they acquired last year.

"We have shown through Philips that we can pay the right price and do so again," said Choudhary.

It is surely good news for Infosys investors since a fast growing BPO would mean more revenues for the company, but Infosys BPO is still no match for global biggies like WNS and Genpact unless it scales up extensively through mergers and acquisitions.

Source : http://www.ndtvprofit.com/

Citi seeks $750 mn for 80% of BPO arm

Citigroup is keen on selling an 80% stake in Mumbai-based captive business process outsourcing (BPO) arm Citigroup Global Services (formerly eServe International) for $700-750 million (Rs2,870-3,075 crore) and is in advanced negotiations with leading private equity investors for an all-cash deal.

While a Citi spokesperson declined to comment on “market rumours and speculation”, investment bankers close to the transaction, who didn’t want to be named, said that a private equity investor is most likely to emerge as the buyer and strategic suitors, such as IBM Corp. and Tata Consultancy Services Ltd, (TCS) are likely to drop out of the race over terms being proposed by the seller. Details on the private equity (PE) firms in the running for Citigroup Global Services couldn’t immediately be ascertained.

“Unlike the Genpact deal, Citi is not willing to commit long-term business to the captive once a new shareholder comes in. Neither IBM nor TCS would be willing to put so much cash down without that commitment,” said one banker. When General Electric Co sold 60% in its Gurgaon-based captive BPO to PE firms General Atlantic and Oak Investment for $500 million, it also threw in a multi-year outsourcing contract as part of the deal.
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Vendors find India’s BPO market attractive

Bangalore: India, already known as the world’s back office, is now emerging as a big market for such services as its economy matures and the global economy slows down.

The opportunities of business expansion in the domestic market have even made US-listed Indian firms such as Genpact Ltd and EXL Service Holdings Inc.—that presently cater mainly to the US market—devise aggressive strategies to enter and expand the presence in the country.

Genpact—listed on the New York Stock Exchange—has signed four customers among Indian financial services firms and banks in the past three months, its president and chief operating officer (CEO) Pramod Bhasin said.

Declining to spell out his firm’s local strategy, Bhasin said Genpact might scale up to 500-600 people by the end of this year from 20-odd now servicing these customers. It expects revenues to flow from the domestic market from the next quarter.

The Nasdaq-listed EXL Service, on the other hand, is scouting for local buyouts. “We are looking for buyouts in the range of $50-100 million,” said its president and CEO Rohit Kapoor, without elaborating. He, however, said the domestic market looks attractive because of its rapid growth and also as a natural hedge against volatile currencies. “With competition increasing in established markets such as US and the UK, they (BPO firms) cannot afford to ignore emerging markets such as India and China,” said Avinash Vashistha, CEO of Tholons Inc., an advisory firm. India’s domestic outsourcing market could emerge as significant as China, he said.

Demand for business process outsourcing, or BPO, services is rising in the country as domestic telecom, banking, aviation and hospitality companies, among others, try to differentiate themselves with sophisticated customer interactions.

The Indian BPO industry, which already employs 7,00,000, generated revenues worth $11 billion in the financial year to March, of which $1.5 billion came from the local market, according to software lobby group National Association of Software and Services Companies, or Nasscom.
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IT and BPO sectors to grow by 33%

Revenue from the Indian IT and BPO sectors is predicted to grow by 33% in the fiscal year 2008, reported Sify.com.

Revenue from exports is expected to go over $40 billion for the two sectors while that of the domestic market will go over $23 billion. The BPO sector is predicted to reach $12.5 billion in 2008 and can grow five times by 2012. As many as two million people are directly working in the BPO sector and seven to eight million people are indirectly working for this sector.

Pramod Bhasin, Vice-Chairman, National Association of Software and Services Companies (Nasscom) and President and Chief Executive Officer, Genpact, at the 2-day Nasscom BPO Strategy Summit in Bangalore on 9 June, said that the BPO industry needs more manpower and is currently looking at employing more than 200,000 eligible graduates. He added that BPOs also have to fight attrition. According to Bhasin, India needs to bring in education reforms and improve infrastructure. He said that a private-public partnership is important in this regard.

Ganesh Natarajan, Chairman, Nasscom, and Deputy Chairman and Chief Executive Officer, Zensar Technologies said that the BPO sector needs to utilise the prospects in rural areas, promote reverse migration and focus on environment-friendly IT practices, cultivate creativity and encourage women to become leaders.

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Bihar BPO unit boosts rural employment

The Indian state of Bihar has always been in the news for the wrong reasons. Crime, abduction and corruption have given enough negative images to the eastern state of India. But things are set to change.

Don’t be surprised to see a business process outsourcing unit (BPO) unit functioning in a chaotic remote village of Bihar. Recently, Drishtee Development and Communications Limited started some BPO units under the name of Quiver Info-services Limited in Saurath villages. The sari-clad introverted village women now communicate effectively with their clients. The BPO employment boost in these villages has dramatically changed the socio-economic status of the poor villagers.

A confident 26-year-old BPO employee at Madhubani, 220km from Patna, said that she faces no problems communicating in Hindi and if needed, she can manage to handle the clients in English too. So far, training has been provided to eighteen candidates to improve their accent and computer knowledge. Most of the candidates have a Mother Tongue Influence (MTI) in their accent.

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Citi to invite bids for BPO arm stake

Citigroup has opened talks with prospective bidders, including IBM Corp. for selling a strategic stake in its Mumbai-based captive business process outsourcing (BPO) arm Citigroup Global Services Ltd, earlier e-Serve International.

While additional details of the stake sale plans weren’t available, based on current annual revenue estimates ranging from $300 million to $400 million (Rs1,230 crore to Rs1,640 crore), industry sources estimate the unit could be valued at over $1 billion.

Citigroup India chief executive officer Sanjay Nayar declined to comment on the development, saying the bank’s policy is not to respond to market speculation, but people familiar with the development and who didn't want their names used said, “Citi has started feeling the market for a strategic stake sale. The process has started and it may take a while before concluding the deal.”

They also said the conglomerate will not go for a complete sell-off. An IBM spokesperson in India said: “We do not comment on speculation and rumours.”

Industry watchers are keeping a close eye on the structure of the deal. One person close to the bank, who did not want to be named, said Citi is exploring the possibility of structuring the deal along the lines of the 2004 IBM-Bharti Televentures outsourcing deal.

In March 2004, IBM took over Bharti’s information technology operations in return for assured revenues of up to $750 million over a 10-year period.

“There could be a similar arrangement whereby IBM would run Citi’s BPO operations for a fee. In addtion to that, it could pick up a strategic stake (in Citigroup Global Services),” this person said.
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BPO exports could increase five-fold to $50 bn by 2012

Bangalore: India’s back-office exports could grow almost five-fold to $50 billion (Rs1.97 trillion) by 2012 provided stakeholders, including the government and the industry, build skill sets and improve infrastructure, according to a study by software lobby group Nasscom and strategy consulting firm Everest Group released on Tuesday.

The Indian business process outsourcing or BPO sector currently exports around $11 billion worth of services, and is growing at 35% a year. It employs more than 700,000 people and accounts for $4 out of every $10 worth of back-office services contracted out to offshore destinations in the world.

The $50 billion target requires the sector to grow by 45-50% a year.
“The study not only estimates the opportunity ahead but also lays down specific agenda for all stakeholders to help achieve this,” said Som Mittal, president, Nasscom.

The study suggests eight measures to do this, including the extension of a tax holiday that is scheduled to end this year; creation of “BPO hubs” with enabling physical and social ecosystems; development of BPO-specific education modules to improve the talent availability and encouraging domestic BPO, among others.

Everest estimates the maximum addressable market size for Indian vendors at between $220 billion and $280 billion, of which less than 5% is currently tapped. The consulting firm also said that the domestic market provides an addressable market of $15-20 billion by 2012.

“A five-fold growth of the BPO industry will add 2.5% to India’s GDP (gross domestic product) by 2012 and create 2 million direct jobs,” said Gaurav Gupta, country head (India), Everest Group. At the current growth rate of 28-30%, the Indian BPO industry would touch $30 billion by 2012
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BPO firms innovate to slash transport expense

“It was so complex it could easily qualify as a question on a GMAT exam,” says the company’s logistics director Gaurav Kalra, who was part of a team deputed to automate Convergys’ transportation programme and bring it under control. Since many employees had a new schedule every five days, he says, someone was spending half the week just converting timetables into routes.

Transportation carries an average cost of 8-9% of a firm’s operating budget

Kalra and Convergys are far from alone in facing and trying to cut spiralling transportation budgets. And in the wake of rising petrol prices, efforts are intensifying among companies that pick up commuting costs for workers.

Transportation carries an average cost of 8-9% of a company’s operating budget in India—a larger expense than even real estate for some companies not sitting on prime land. With fuel costs set to increase, logistics directors are turning to a mix of technology and planning to keep the expense as low as possible.

“What’s good today is not good tomorrow,” says Yash Kapila, who heads the facilities management group in West Asia for the real estate consulting firm Jones Lang LaSalle Meghraj and consults on transportation projects. “You look at the need, and you challenge the requirements.”

The firm recently did that for an international financial services company that clocks 17 million km each year in employee transport, according to Kapila, and helped the company cut its annual transport budget by Rs1 crore. He declined to name the company citing a confidentiality clause in the client’s contract.

Part of the savings came from rationalizing the way people were picked up, and trying to pick up as many people as possible in the same area, he says, but the bulk of the savings came from something even morebasic.

“What would traditionally happen: the car picks you up at 7am, and you ride back at 8 pm,” says Kapila, “but you would have that car for 13 hours and the customer is paying for idle time.” In part by telling its vendors it would no longer pay for idle time, the company brought its costs per employee down from around Rs300 per day it was paying last January to Rs170 per day this April.

Other approaches to cutting transportation costs involve less wholesale options and more fine-tuning. The Hinduja Group’s back office services unit HTMT Global Solutions Ltd, which spends more on transport than its office rentals in Bangalore and Mumbai, tried to squeeze costs out through combining pick up and drop locations, according to Narashima Murthy, who led the company’s India operations, and just moved to the North Americadivision.
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Internet cable breakdown affects Infosys BPO services

NEW DELHI: The BPO arm of country's second largest software exporter Infosys said on Friday that the company was experiencing a slow response time while accessing internet following a breakdown of cables in the Mediterranean sea.

"We are observing high latencies and packet drops on affected internet circuits resulting in slow response times while accessing applications, VPN, email and internet browsing," a company spokesperson said in an emailed statement.

While repair of these cable systems is expected to take about two weeks, the cable system providers are working on alternatives to mitigate this damage, the spokesperson said.

There has been damage of cable systems in Alexandria off Egypt coast, which has impacted internet connectivity and IPLC/MPLS services in India, the statement added.
However, another IT major Satyam said its BPO operations have multiple service providers and following the crisis they have rerouted their connections.

"Given our robust business continuity framework, we have succeeded in ensuring that services to our customers remain unaffected and continue meeting service level agreements," Satyam's Head (Network and Systems) Srinivasu C said.

Another BPO firm Infovision said the BPO business has not seen a major affect.
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Genpact signs deal with Ceridian Corp for BPO services

NEW DELHI: Genpact has signed a multi-year contract with payroll processing and HR management firm Ceridian Corporation to provide selected BPO services, including finance and accounting services, transactional business support activities, and IT outsourcing. Terms were not disclosed.

Under the contract, Ceridian and Genpact will operate under the virtual captive model. The Genpact-Ceridian centres initially will be set up in Juarez in Mexico, and Jaipur and Kolkata, India. Other locations in Europe and the Philippines are being evaluated.

Genpact also said its services were not disrupted due to damage to the undersea cables traversing the Mediterranean Sea that carry internet traffic between the Middle East and India.

“Genpact uses four DS3 links — two across the Atlantic and two across the Pacific — for its telecommunication needs... One link was affected yesterday (January 31), but because we had three other links, it did not affect service to our clients.
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IT biggies, buyout funds join race for BPO firm Aptara

MUMBAI: A couple of large buyout funds, foreign strategic players and Indian IT & BPO players, including Infosys Technologies, are learnt to be in the race for Aptara, a third-party BPO in technology publishing. Promoted by US-based Indian, Rakesh Gupta, the firm is one of the oldest and established players in the industry, having started in 1988.

No official confirmation was available, but sources said six players have been shortlisted and the sale could be concluded in a couple of weeks. Avendus Advisors is advising the firm on the sale process. The final deal could be around $150 million, a source said.

Till recently, known as Techbooks, the company changed its name to Aptara in 2007 to reflect its intent to diversify into services outside its core publishing and content business.

One of its earlier investors, PE firm American Capital, is also set to exit the company in the sale, the source said.

In its core domain, Aptara counts a few leaders such as Reed Elsevier and Blackwell Publishing among its clients in the niche scientific, technical and medical (STM) publishing business, as well others such as Cambridge University Press, Oxford University Press, McGraw Hill and Wiley.

However, last year, the firm also diversified into legal services by acquiring Whitmont Legal Technologies, a litigation support firm. According to information in public domain, the company has grown from about Rs 247 crore in revenues in 2005-06 to Rs 336 crore in 2006-07.
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BPO firm EXL starts operations in Manila

NEW DELHI: Business process outsourcing firm ExlService Holdings on Tuesday said it has commenced operation at their first service delivery centre outside the country in Manila, Philippines entailing an investment of 8 million dollar.

"This is the first delivery centre of EXL outside India. We have invested about 8.3 million dollar to set up the facility," a company spokesperson told reporters.

The Philippines facility, which has a capacity of around 950 seats, has been built to meet the expanding demands of EXL's existing clients in multiple industry verticals as they spread their outsourcing operations globally, the company said in a statement.

Through this expansion, EXL seeks to provide a range of outsourcing services from Philippines for both new and existing clients, it added.

"We believe that Philippines represents a valuable source of talent that will complement the significant transformation and outsourcing capabilities we offer today from India. Our presence in the Philippines will further enhance EXL's business continuity capabilities and disaster recovery framework," EXL President and COO Rohit Kapoor said.

Earlier talking to reporters, Kapoor said, the company is also eyeing the Eastern European market and is planning to open a new centre in Romania. The company has plans to start centre in Latin America by 2009, he added.
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Talent crunch forces BPOs to dilute tasks

HYDERABAD: The Indian BPO job may be getting onto a factorylike assembly line chore.

Similar to automobile shop floors, where jobs are broken down into miniscule tasks and processes demarcated step by step, BPO companies in India are experimenting of breaking a complex activity into numerous simple chores, to be easily performed by even school passouts.

The dilution of task difficulty is primarily seen as a solution to talent crunch and a way to check attrition and battle wage inflation. Although it is not yet mainstream, if scaled up, it will throw up an opportunity for rural India to become the backoffice for BPO operations in metros.

According to Nasscom vice-president Ameet Nivsarkar, “These experiments are being piloted by some BPO firms and the results are encouraging. We have to see how this can be scaled up. Essentially, this could help the BPO industry spread to tier II and III towns where smaller tasks can be offshored.”

The BPO industry in India is currently centred around six metro cities in India which account for over 90% of the operations.

Offshoring within India would capitalise on the vast rural and school dropout population. Says rural back office vehicle GramIT chief integrator Verghese Thomas, “Destinations like Dhaka and Philippines are becoming attractive as lowcost centres. There are 30 million 12th pass people in rural India who could be part of the rural BPO revolution.”

Typically, non-voice and data entry activities could be offshored. Take the example of a mobile phone bill. It has components such as name, address, billable amount and so on.

This activity could be broken into multiple tasks where one person is responsible for only typing names while another does only addresses and the third keys in the billable amount. The software aggregates this information to process the final bill. Also, in more complex jobs, a step-by-step process training is being conducted for quicker and accurate job completion.
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Japan BPO firm chooses Philippines over India

MANILA, Philippines—Tokyo-based Transcosmos Inc., said to be the biggest contact center company in Japan, has chosen the Philippines over India as a launch pad for its entry into the English-language market, its chosen Philippine partner said.

The local partner is the medium-sized call center firm, Logicall Inc., based in Makati City.

“The objective of this partnership is for the Philippines and Logicall to become the primary English delivery location that will answer the existing demands of Transcosmos Inc.’s client base,” Logicall chief executive Archie Rodriguez said.

He said Transcosmos would invest P120 million to help Logicall expand its capacity in the Philippines from 300 to 3,000 seats by 2011.

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WNS Holdings set to bag Aviva's BPO operations

BANGALORE/MUMBAI: WNS Holdings appears to have emerged as the highest bidder for insurance giant Aviva’s BPO operations — Aviva Global Services (AGS) — with an offer of over $200 million. The deal covers acquisition of Aviva’s captive unit, outsourced operations parked with vendors and an assured business from the UK-based insurance firm for a five-year period, sources said.

Private equity giant Warburg Pincus-controlled WNS is believed to have pipped rival outsourcing firm, EXL Services, and a multinational player — rumoured to be Capgemini — in a rather prolonged bidding process that marks the successful sale of a large captive BPO unit in the country.

When completed, WNS is set to absorb around 6,500 employees of Aviva’s consolidated operations spread across Bangalore, Pune, Noida, Chennai and Colombo.

Among recent deals, this is complex, not only because of the complications associated with a captive unit, but also because it involves the consolidation of multiple legal entities.

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BPO industry still needs nurturing

Say BPO and usually the first set of images that flash through the mind are Gen-X youngsters working in swanky hi-tech offices, with lavish canteens and a fleet of air-conditioned cabs ferrying them around town and the outskirts at odd hours. It is easy to think BPO-owners are quite like King Midas of our times. After all, if they can offer all those facilities and pay packets to entry-level employees, it’s not hard to imagine them making big profits. Right? Wrong. Contrary to general perceptions, the BPO industry is at an inflection point from where it is about to tip down. A large number of entrepreneurs have closed shop because of huge operational losses.

It happens with almost every industry that in a nascent stage, a large number of players jump onto the bandwagon. As the industry matures, some of them survive while the rest eventually die out in the cut-throat competition. That has happened to the BPO industry in India as well.

Added to this is a long list of woes: over- dependence on North American and European mid-rung Markets, crippling effects of the sub-prime mortgage crises, rupee volatility, rising inflation, soaring fuel prices, intra-industry attrition, looming taxes, global warming and an ill-informed and non-sensitised government machinery.

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