It’s Time That BPO Is Recognized More Than A Call Centre – Bharatico

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New future of call center

New future of call center

BPO industry is responsible for generating 50 per cent of jobs in urban India but it is still being tagged as call centre industry.

Diksha P Gupta, EFY News Network

Wednesday, May 09, 2012: It is an interesting time for the Indian BPO industry. The industry is now in a phase of contradictions. When Noshir Kaka, managing director, McKinsey and company referred to the Indian BPO industry, they chose to describe it like this and he had his reasons to do this as well. He said, “Nasscom’s report released a week ago said that industry will grow at around 14 per cent and it is still less of growth.”

Kaka was chairing the CEO round table at BPO India Forum 2012. Focusing on the non-linear growth model of business, he invited opinions of industry experts including Hanumant Talwar, managing director and country manager, India and UK, Convergys and Sanjiv Kapoor, senior vice president and global head of BPO and iTOPS, iGate. Talwar said, “Non-linear growth for us means business as usual. It is about providing what customers need. We clearly have to look at providing value-add and outcome based service to a client.”
Kapoor, however, had a different opinion on this issue. He said, “If we look at the figures, I think non-linear growth accounts for less than 10 per cent for platform based BPOs. I think both linear and non-linear models have to co-exist for right development.”

Indian BPO industry has been around for 10 years now and it has surely crossed the nascent stage. After seeing good expansion in Tier I cities, the companies are exploring Tier II and Tier III cities now. The concept of rural BPOs has also come in. But the image of being tagged as a call centre has been attached to the Indian BPO industry ever since it started. Raising his grievance against this notion, Narayan Sampath, head, India Business, said, “BPO industry is responsible for generating 50 per cent of jobs in urban India but it is still being tagged as call centre. I think it’s time that people start looking at the industry with broader perspective. It’s time that BPO industry is recognised more than just a call centre industry. Infosys alone has about 140 clients, many of which are very high-end processes.”

Outsourcing has become a need for many industries. Representing the telecom industry, S Asokan, executive director, supply chain, Bharti Airtel, said, “It’s impossible for any telco to deal with the entire business without outsourcing. Outsourcing some jobs is a win-win situation. You get the job done at the best price.”

(News taken with obligation from Bpo Times can be removed if objected).

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BPOs are coming out of the coder shadow ( India News 2012 )

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By Beryl Menezes & Praveena Sharma | Place: Mumbai, New Delhi | Agency: DNA

Is the business process outsourcing (BPO) servicessegment finally emerging from the shadow of information technology (IT) services?

It sure seems to be trying. In fact, last quarter, most BPO subsidiaries and firms grew at a faster clip than their IT counterparts.

Tien-tsin Huang and Puneet Jain, analysts with JP Morgan, said BPO major WNS’ robust revenue growth of 2% sequentially and 7% year-on-year last quarter underlines buoyancy for this year.

“WNS is seeing benefits from restructuring… and healthy demand environment for BPO services. The company is also seeing a nice build-up of large contracts in its pipeline. WNS needs to win a couple each year to drive next year’s revenue growth,” they said in a note last week. Back home, even HCL saw its margins salvaged by a turnaround in the BPO numbers.

“While… results (of HCL) are ahead of expectations with positive surprise on margins, a large part of the beat was driven by turnaround in the BPO segment,” Religare analysts Manoj Singla, Rumit Dugar and Udit Garg said in a note on Wednesday.

Ankita Somani of Angel Broking said the demand environment for BPOs was improving as clients looked at globalisation of delivery capabilities, which was driving transformation and enterprise-wide cost efficiency.

“HCL is continuously investing in building platforms for non voice-based businesses in this segment. Demand is seen in areas of cloud, mobility, social media and multi-tower end-to-end process data,” she wrote in her report.

Even Sid Pai, managing director and partner, TPI, the third-party outsourcing advisory, said one reason BPO revenues were climbing was it was no longer a back-office support kind of work but more higher-end such as business-oriented core functions that customers were seeking. According to Samiron Ghoshal, partner and national leader, IT advisory & global talent, Ernst & Young, there were two main factors driving the recent BPO growth.

“First, peer BPO deals (contact centre) are not happening so much anymore, and there are more KPO-linked deals. Secondly, a lot of deals which took place in the last 5-10 years are coming up for renewal in the next 12-18 months. The new renewals are also seeing some change in strategy, where processes are being divided between players, instead of giving out bundled contracts for all BPO services to a single player as was the case earlier,” said Ghoshal.

This, he said, worked in favour of companies like HCL, who have more value to add than pure voice BPOs.

“However, this sudden rise in BPO gains can be looked at as a sporadic change and not a complete lifting of the BPO segment since it impacts Opex (operational expenditure) spends and not Capex (capital expenditure) spends,” said Ghoshal.

Ritesh Idnani, chief operating officer of Infosys BPO, said in a recent interview to DNA that he expected the BPO market in India to grow faster than the IT market this fiscal.

Keshav Murugesh, CEO, WNS, said what had turned the tide in favour of BPO was the segment’s focus on non-linear services as well as more consulting and technology-based offerings. He said most firms were slowly moving away from traditional BPO offerings.

“For long, too much attention has been focused only on the IT functions of a BPO process whereas there is a great difference between an IT and BPO buyer on the strategic side. In the current recessionary climate, they are now outsourcing more of their non-core functions to BPOs like WNS, which can provide them with new ideas to improve their top-line and bottom-line,” he said.

IDC has predicted a compounded annual growth rate of 19% for the offshore BPO market in the next five years, the bulk of which is expected to come from India. Recently released TPI index shows that while outsourcing contracts were down 37% sequentially and 20% annually, BPO contracts were up 30% and 27%, respectively for the same periods.

TPI’s Pai, however, does not see BPO revenues overtaking IT services revenues in the near future mainly because of the way its contracts are structured.

“I don’t see it (BPO segment) becoming larger than IT services because of the way it is bought. I believe IT companies would continue to go after IT services contracts,” he said.

Reason of Indian BPOs faring better than their big IT brothers?

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Bpo INDIA

Bpo INDIA

It is not all gloomy give a positive and rosy picture about the growth potential of this sector. However, this is contrary to the case of IT divisions of these companies. They have reported a decline in revenue growth and delays in cash realization.It is quite intriguing to see how BPO concerns are faring better compared to their big brothers, the traditional IT arms of these Indian giants.

CNBC recently discussed this issue and observed that Indian BPO firms were able to make some adjustments in their operating model to effect this positive outlook. They have taken some bold steps around shifting their conventional operating model around offshore centres. On an interesting note, Infosys BPO has more onsite and onshore centres compared to offshore units. They have twelve onsite/onshore as compared to six offshore units in India. Revenue charts justify why this decision to go for more on shore units has truly turned around things for BPO’s. Infosys BPO reported that now 30% of their revenue is coming from units outside India.

The advantage of a global delivery model is that clients are now willing to trust BPO partners for their high value transformation projects. Earlier since the support was carried out mostly from remote offshore locations, clients were willing only to give transactional projects which purely focused on cost savings and operational efficiency. Global economic instability and market fluctuations are pushing enterprises to focus more on customer centric business initiatives and collaborative business models. They are more of strategic and transformational nature. This is where Indian BPO’s have successfully positioned them to serve these strategic needs of enterprises. Now they offer competent Onsite consultants who have local market and deep domain knowledge to partner with clients for solving their business challenges. This is unlike earlier days when Indian BPO’s only used to serving the processing and operational needs of these enterprises.

Indian BPO’s focus on high value side of business consulting has certainly helped them reap benefits in terms of revenue over the last year. In the days to come we can see that more and more BPO’s focusing on developing capabilities around building up strong global delivery network. They will have the high profile consultants operating out of onshore centres with deep market and domain knowledge.

Indian BPO’s are not just growing organically by having more onsite centres, but they have also focused on growing inorganically bringing in firms with local business consulting experience, hoping that it would certainly increase the value of customer engagement.

BPO industry to hire over 230,000 in INDIA ( 2012 )

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Will the IT outsourcing market double in 2016? What  are the key factors in growth of BPOs? What’s the scope of BPO industry?

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These and many more questions will be answered at the 26 BPO conferences being organized across India,  which promise to give an insight into leading issues relating to the development sector.

Starting in New Delhi on May 23, the Bharatico BPO Conference, being jointly organized by BPO Association, brand specialist Promozz Media and event management firm Alpcord, is aimed at bringing to the fore interesting and inquisitive facts concerning the BPO industry.

Siddhaarth Sharma, vice president, Promozz Media, says “The Bharatico BPO Conferences will have 26 keynote sessions and workshops along with over a 1000 senior professionals of the BPO industry as speakers and over 10,000 BPO experts as well as government officials presenting and discussing the growth and scope of the BPO industry.”

The conference draws significance as the the BPO industry is set to hire over 230,000 people in 2012.According to a recent survey by Ma Foi, ITES is one of the most optimistic sectors for hiring and they are among the top job generation sectors, with most of these leading from Tier 2 and Tier 3 cities of the country.
“The skill set for BPOs is shifting from urban towns to Tier 2 and 3 cities and that is where lies the answer to the near 400 per cent attrition that is plaguing the sector,” said Sandeep Jain, president of the BPO Association.

The conferences will be held at Mumbai, Bangalore, New Delhi, Chennai, Kolkata, Chandigarh, Hyderabad, Pune, Jaipur, Ahmedabad, Patna, Ranchi, Bhubaneshwar, Panaji, Gandhinagar, Trivendrum, Cochin, Shimla, Dehradun, Pondicherry, Lucknow and Agra.

“While India is best equipped to capitalize on the available opportunities, efforts should be made to ensure that these opportunities are not lost to other offshore destinations,” said Manan Vashisht, senior vice president, Bharatico Infomedia Ltd.