BPO staff may soon work from home too

Wednesday, September 30, 2009
A year after the department of telecommunications conditionally relaxed rules on IT-BPO employees working from home, Raman Roy, chairman & managing director of Quatrro BPO Solutions, has started pilot projects in Mumbai and Delhi to explore the possibility of scaling up the model.
Quattro is the first BPO to have secured permission for this model from DoT. "This is a provisional permission. Once the company is able to meet all our security concerns, we will grant them a license," confirmed a senior DoT official on condition of anonymity.
The license is a prerequisite for service providers to provide infrastructure and last-mile connectivity.
The $11-billion BPO sector employs over 750,000 people, and 'working from home' could add significantly to the employment numbers, said Roy. He added that he has been 'toying with the idea for nearly two years before I got help from software body Nasscom and the required permission from the DoT.'
Roy plans to launch another pilot in Chennai soon. He has also appointed a dedicated team of six senior employees -- including a lawyer and a technician -- to make these pilots successful.
"We feel this is the next-generation step for the industry. It will create jobs for people who are educated but don't have the flexibility to go to offices. Besides opening a career option for them, it will create a flexible workforce. So, housewives and others can work from home, will have flexible work timings and also earn money," said Roy.
Currently, the 30-odd employees who work from home have a computer that is connected to the company's server (using virtual private network or VPN technology). Whenever an employee logs on to the computer, the data on the screen is monitored by a supervisor sitting at the Quatrro headquarters in Gurgaon.
The supervisor sits in front of four large Plasma screens and can see each of the employees' monitors. If he wants to speak to anyone of them, or clarify any of their doubts, he accesses the webcam.
Currently, these employees are involved only in non-voice work which comprises both low-end data entry work and in some cases high-end data analytics, Roy said.
The main hurdle in this case is ensuring that a client's data is secure. "The test is all about security. So, the solution is that when the employee logs onto our server, the supervisor will be able to see him and his activities. The plasma screens ensure constant monitoring and guidance. The VPN pipe takes care of security," Roy said.
Usually there are 8 to 15 supervisors in one shift but for this virtual model one supervisor will be able to supervise 16 or 32 sessions at one go.
If the pilots are successful, Quatrro plans to expand this concept and train people by sending supervisors to tier-II and III cities and towns where it will set up training centres.
Roy said he has already spoken to some schools and received a favourable response from the principals. Quatrro will set up a computer lab with around 10 computers in schools that will be used by the schools in the morning and for training BPO 'work- from-home' aspirants in the evenings.
Going forward, employees who are selected for the work-from-home programme will be provided with computers in their homes for which Quatrro will stand guarantee with banks.
The company will deduct the monthly installment from the employee's salary.The salary structure for such employees, said Roy, will mainly be variable as the fixed salary structure will not work here. "We plan to make the pay structure transaction-based.
The higher the number of transactions, more the pay," he explained.
Another company that is experimenting with this concept is Aspect Software. "The home agent is the new wave of offshoring and is not intra-continent but intra-country. The processes demands what percentage of people can be home-based," explains Rajeev Soni, Managing Director, Aspect Software.
The company has experimented with this concept with Sparsh BPO and its own BPO for both voice- and non-voice work. However, it is yet to get a licence from the DoT to roll out the services on a commercial scale.
Soni explained that by using Microsoft's Unified Communications in the work-from-home concept, the follow-up calls went down from 18 to 20 per cent to 8 to 9 per cent, thereby reducing costs.
Analysts, however, remain sceptical about arrangements related to working from home on the ground of- data security, infrastructure, data processes, employee motivation and monitoring problems and lack of a controlled environment.
"Independent work can be done in a work-from-home arrangement but group work requires a controlled environment. Models like these work only when data masking is possible," says Sabyasachi Satpathy, partner at advisory firm Tholons.
Moreover, processing needs to be scrutinised and a faster turnaround can't take place in such models, said analysts. Few companies are interested in the work-from-home policy as infrastructure is another problem and the work will have to be verified.
"We understand and appreciate these concerns," countered Roy, adding: "After all, I have been there and seen this industry grow to its present size. But I believe that we will make this concept work."

Infy scouting for BPO firm in Canada

Tuesday, September 29, 2009
Infosys BPO Building
Infosys BPO Ltd, the business process outsourcing operation of Infosys Technologies, is looking at raising its headcount in the Americas through inorganic growth. The company is understood to be scouting for a strategic acquisition in the $40-60 million range either in Canada or the US, according to industry sources.
"Infosys is looking at acquiring a small or mid-sized company, specialised in providing mortgage or insurance BPO services to grow faster in Canada.
This will help speed up verticalisation efforts currently on at Infosys BPO. The mortgage sector in Canada has seen a number of promising start-ups, as well as established mid-sized companies coming up over the years.

Infosys BPO is looking at further growth in the key mortgage and insurance verticals in Canada, where a strategic acquisition will boost the scope for higher knowledge work, like financial research and analytics," sources said.
The BPO arm has a stated focus on transaction-based processing work, particularly in the finance & accounting software space. Mortgage solutions have emerged as a key vertical for the BPO operations.

An Infosys BPO spokesperson declined to comment on any acquisition plans or time-frame for the deal. The company is presently in its self-imposed silent period as a run-up to announcing its first quarter financial results on July 10.

Infosys has said that it will increase its hiring in overseas markets, including the US and Canada. In the current fiscal, the company plans to hire about 1,000 people in overseas locations, including the US, which is more than double that of last year's figure.
The company is not keen on making acquisitions in India, as it is capable of growing organically quite fast in the country. Chief Executive Officer S Gopalakrishnan had said at the company's annual general meeting in Bangalore on June 21 that Infosys saw a requirement for acquisitions more outside India, where it faced challenges in adding employees.
To tackle pricing pressures from clients in the US and Canada, Infosys Technologies has been increasing its focus on new engagement models, such as platform-based BPO services, Software-as-a-Service and Finacle to maximise the value delivered to its clients. The BPO business of Infosys posted gross revenues of $316.2 million (Rs 1,520 crore) in the fiscal year to March 31, 2009 and employed 17,398 people at the end of the fiscal. The BPO arm is presently recruiting from smaller towns like Mangalore and Mysore, as part of its focus on the domestic market and to capitalise on lower rentals and employee costs. It is also looking at tying up with rural BPO outfits to save on real estate costs. The company had last month set up a dedicated domestic market arm, with an eye on the $1.6-billion domestic BPO market.
Infosys Technologies, which had cash reserves of Rs 9,695 crore (Rs 96.95 billion) as on March 31, had made two successful acquisitions during its nearly three decades of existence. Earlier acquisitions were that of Australian firm Expert Information Technologies for close to $23 million in 2003, and the buyout of Philips' global BPO operations in 2007.

Best BPO Companies in India

Friday, September 25, 2009

BPO or Business Process Outsourcing is one of the sunshine sectors in India. According to statistics by World Bank and Goldman Sachs, an investment banking firm India will attract about 80% of the world's BPO industry by 2020. BPO is one of the most outperforming sectors in the Indian economy. Services, which account for almost 35% in India's productivity has BPO at the heart of the growth.India is blessed with 50% population below 35. India is fortunate to be blessed with a young English speaking population. The British left their main legacy behind, when they granted independence to India; English. India, according to statistics is the second largest English speaking in the world just below the United States. Moreover, Indians are known to be processing one of the most neutral accents in the world. The citizens of India, especially the BPO workers have the potential to speak various accents in the world including American, British, Canadian and Australian to name a few.Recently, many BPO companies from East Asia and continental Europe have set up BPO offices and call centers spanning all of India. Indians, especially BPO workers are trying their best to learn new languages apart from English. There is a rapid rise in the use of foreign languages of Korean, Japanese, French, German and Spanish. Young Indians are constantly getting acquainted with these languages to serve their clients and customers based in these countries.The most important reason why companies outsource to India, besides being the country of young English speaking people, is the cost advantage. The Indian currency, Rupee, is pegged at Rs. 50=$1. Indians, due to the far lower cost of living are happy to work at only 25% of an average westerner. They are not only more efficient and work for a mere amount compared to a westerner. It is beneficial to outsource, and India is the best destination for all your outsourcing needs.

TCS bags outsourcing contract

Thursday, September 24, 2009

Tata Consultancy Services has been selected as an IT vendor by BP for the oil and gas majors refining, manufacturing and corporate maintenance works. "Our selection as a strategic IT vendor for BP demonstrates our strong domain expertise and highlights the investments we have been making in the technology-led energy sector," TCS Chief Operating Officer and Executive Director N Chandrasekaran said in a release.When contacted a TCS official told PTI that the deal was for five years, but she did not reveal the value of the deal.BP has a rigorous procurement selection process which assessed the capability, oil and gas sector knowledge and cost.BP is one of the world`s largest energy companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.TCS energy vertical serves international and domestic energy companies across the industrys value chain. It also works with oil field services companies on solutions that help increase the production and reliability of upstream operations, the release said."In awarding TCS our refining, manufacturing and corporate maintenance work, we look to benefit from their knowledge of the oil and gas sector," BP Group CIO Dana Deasy was quoted as saying in the release.The contact would help BP to reduce complexity, standardise processes and lower overall cost base, Deasy said.

Global BPO vendors poach staff from local cos

Tuesday, September 22, 2009
Global outsourcing vendors such as Accenture and Capgemini are increasingly poaching employees from Indian rivals as they tap into professionals with expertise in offshoring to compete more effectively against companies like TCS, Wipro and Infosys.
As offshore outsourcing goes mainstream, multinationals are hiring Indians to head their sales teams in key markets in Europe and the US, a shift from the practice of employing locals to win contracts.
“This is happening for several roles spanning from sales, sales support to delivery. There is in a sense, even positive discrimination towards Indians now,” an Indian executive who joined a multinational in Germany recently told ET on condition on anonymity.
Offshore outsourcing, or remote delivery of software application development, maintenance and support from countries like India, helps customers such as GE and Citibank save up to 40% in costs. Indian companies such as TCS, Wipro and Infosys started using offshore outsourcing to their advantage around a decade ago by wooing customers with significant cost-benefits.
In recent months, about a dozen or so top professionals have left an Indian company to join multinational competitors. Padmanabhan Ananthanarayanan, who headed India’s largest software exporter TCS’ sales organisation in Europe until February this year, joined Accenture in March as director of its outsourcing business based in Germany.
Shishir Kumar and Vikas Baranwal quit TCS earlier this year to join Accenture as sales directors, Nimit Chawal and Dev Sharma joined Capgemini to lead the company’s sales team. Mr Sharma headed Wipro’s business development and account management for manufacturing and automotive customers in Germany until December last year, before becoming director, business development for Central Europe at Capgemini.
Sridhar Vedala, managing director of offshoring advisory firm Quantum Step, says global service providers are hiring more Indian professionals to influence the perception of customers who are looking at India and Indian professionals as synonyms for offshore outsourcing.
“Now when offshoring is in demand, obviously customers prefer Indian providers. In order to influence the perception, global providers are hiring Indian managers,” he observed.
Among such customers is the world’s largest chemical company BASF, which is seeking offshore suppliers to support its business IT systems and looking to commence a dialogue with Indian offshore managers. “Initially, global providers did not care about the competition from Indian providers. Probably, they never thought that Indian providers will be able to compete with them for larger deals,” he added.
A top executive at an Indian tech firm says many outsourcing dialogues these days are being spearheaded by Indian offshore delivery managers, unlike in the past, when local experts would help them gain access to a potential customer. “The chief information officers are specifically asking for Indian suppliers.”
The over $40-billion Indian software outsourcing industry derives almost 70-80% of its revenues from offshore outsourcing. While established outsourcing vendors, such as IBM and Accenture, still lead the market because of their early relationships and ‘onshore intimacy’ with large customers, several new outsourcing customers are now looking at pure offshoring, which is helping the Indian vendors.
“For all large application management deals, the question is no more offshore or no offshore, but how much to offshore and in some cases ‘why should anything be onshore anymore’,” said a person involved with decision-making at a large enterprise in Germany.
“This is such a contrast. Until a few months ago, some Indian companies were trying to hire more locals in Germany and France, but now customers are becoming more comfortable with Indian managers,” said a senior Indian professional based in Munich, Germany, who recently quit one of the top ten Indian software exporters to join an MNC rival.
Hema Ravichander, who was the head of human resources at Infosys and is now an independent consultant, says Indian professionals are highly valued because of their early offshoring experience.
“Speed, adaptability, networking, deep understanding of the competitor landscape make them valuable. Also, they have been there, done that; so they enjoy high credibility,” she said.

RPG proposes investment of Rs 15,000 crore in power

Monday, September 21, 2009
RPG Enterprises envisaged an investment of Rs 15,000 crore in the power sector in five states in the coming five years including hydropower and non-conventional forms of energy. The sources informed that the five states selected by the company for the new projects are Orissa, Jharkhand, Bihar, Maharashtra and Bengal.
The sources further informed that RPG's entry into the hydel and non-conventional energy, will increase its plants power capacity by 6000 MW over the next few fiscals.
The company stated in a communiqué that the funding of the proposed power projects would be done in a 1:2.3 debt-equity ratio.

Global recession ending: OECD

Friday, September 4, 2009
PARIS - The global recession is coming to an end faster than thought a few months ago and may already be over, but recovery will rely on massive government spending and low interest rates for some time, the OECD said on Thursday.

The Organization for Economic Co-operation and Development issued forecasts showing a broad return to economic expansion in the third quarter of 2009.
It also said that while authorities needed to map out a strategy for withdrawal of fiscal and monetary stimulus once recovery was surer, now was no time to economies off life support.
Click on http://www.oecd.org/dataoecd/10/32/43551364.pdf
The recovery might prove a little stronger than previously predicted, OECD chief economist Jorgen Elmeskov told Reuters in an interview where he elaborated on the forecasts for several key economies.

"Compared with expectations a few months ago, we now have a recovery which ... may be coming a little earlier and it may be slightly stronger because financial conditions have improved more rapidly than we assumed a few months ago," Elmeskov said.
The OECD forecasts show a third-quarter return to annualized quarter-on-quarter growth in the United States of 1.6 percent, 1.1 percent in Japan, and 0.3 percent in the 16-country euro zone, led by its two largest economies, Germany and France.

The pickup that started with a "quite dramatic turnaround" in China and other Asian emerging market economies in the second quarter remained heavily dependent on government stimulus and ultra-low interest rates across the world, Elmeskov said.

TURNING POINT FOR G7
While it predicted continued third-quarter contractions in Britain and Italy, and a rise followed by a fourth-quarter dip for Japan, the OECD said the broad picture for the G7 group of industrialized powers was better.
The forecasts, including information up to Sept 2, show the euro area turning positive in both of the last two quarters of 2009 after five straight quarters of contraction.
Indeed, a monthly business survey on Thursday showed an index measuring activity in the euro zone manufacturing and services sectors combined now edging into expansion territory in August.
The OECD now expects 2 percent annualized growth in the euro zone in the fourth quarter, compared with its June prediction for a 0.5 percent contraction.
On Thursday, the European Central Bank raised its staff projections for euro zone GDP this year and next, predicting growth in 2010 of between -0.5 percent and +0.9 percent.
The previous OECD growth forecasts for the United States had been zero and 0.5 percent for the third and fourth quarters -- now upped to 1.6 percent and 2.4 percent respectively.
It sees annualized GDP rises of 1.2 and 1.4 percent in the third and fourth quarters for the G7 as a whole, also signaling an exit from recession at that level.
"In some countries including the United States it also looks as if the bottom of the housing market might have been hit a little earlier than assumed," Elmeskov said, noting a rise in house sales and a drop in the "overhang" of unsold homes.
DON'T PULL THE PLUG YET
The OECD forecasts came on the eve of a meeting of finance ministers from the G20 group of developed and developing economies, at which they are likely to agree it is too soon to begin withdrawing stimulus measures.
"Substantial slack combined with the prospect for a weak recovery implies that strong policy stimulus will continue to be needed in the near term," it said.

The Future of Business Processing Outsourcing Industry

Wednesday, September 2, 2009

Outsourcing is an age old practice and the advent of business process outsourcing is clearly an example of paradigm shift. It is the way in which business operates, or can be operated. The advent of current BPO revolution has been driven by the availability of cost effective technology such as Internet broadband services, inexpensive data storage, continued business process specialization and online analytical processing tool.


The paradigm shift is that, the technology has enabled global exchange of BPO services. Today, BPO industry had matured to the extent that the costs are normalizing and becoming attractive. Over the last three decades Business Process Outsourcing has been catering to number of services like retail, insurance, mortgage, banking, finance, health care, telecommunications, travel, technology, hospitality and many more.

Today, many offshore firms are consolidating and standardizing their operations by outsourcing their business process to third parties. There are many BPO service providers in India that offer cost effective and focused management expertise. In the present scenario many UK and US based firms are looking at countries like India, Philippines, China and other South Asian territories to outsource their services.


According to a research conducted NelsonHall- a BPO analyst firm
✔ 80% of the firm claimed that, outsourcing has increased their competitiveness.✔ 87% of the companies said that, outsourcing had improved their internal processes.✔ While 77% of the companies said that, they could see a significant drop in their operational cost through outsourcing.


The offshore BPO services are expected to grow at a significant rate per year within the Asia-Pacific market. The growth rate will be about $14 billion by the year 2010. The BPO business in India will be booming despite the current economic recession. The economy will stabilize and there five fold growth of the BPO industry within the next five years.


According to a research, ‘Road map 2012 - capitalizing on the expanding BPO landscape’, conducted by Nasscom and Everest Group, the revenue of the Indian BPO industry will touch $50 billion and will add about 2.5% of the gross domestic product by the year 2012. Presently BPO sector employs about 8 lakh people and the annual revenue is about $11 billion. Over the next 5 years the BPO industry will employ nearly 2 million people.


Once again, one reason why BPO has grown over the 10 years is the availability of high end technology and infrastructure. Without the availability of Internet and broadband, this could not have been possible. The development in technology has broken down the barriers of global communication.


Considering the progress made in the outsourcing industry over the last ten years is standardizing and automation of business processes, the next five years promise similar advances. Typically, the multinational companies define market trends and the acceptance of new product and services. Keeping all these in mind, the BPO industry could take a new shape over the next five years.

BPO Industry As A Career Option

Taking a look at the current financial crisis, one may not feel too optimistic about business process outsourcing( BPO) industry in India. However Mr. P. G. Raghuraman, Lead Delivery Centers for BPO in India, Accenture, sees the positive aspects in the growth of BPO service providers and also potential for the industry to attract young professionals as their chosen career.

According to Nasscom study, the current size of BPO industry is $11 billion and it is expected to grow by five-fold in size to $50 billion by the year 2012. This growth in Indian BPO will add nearly 2.5 percent to the India's GDP from the export earnings and employment to nearly 2 million people.
There is popular belief that,there are numerous job opportunities but fewer career opportunities in BPO sector. This is not true,the Indian BPO industry has boundless career opportunities. This is evident from the fact that, over the years the BPO services have grown from just voice to other customer relationship management services like human resources,finance and accounting, learning and procurement, animation and multimedia, legal transcription, content development, as well as industry-specific services focusing on the health care,insurance, pharmaceutical and utility industries.

The companies in the life science industry are quite familiar to the process of outsourcing. They outsource some of their critical process like drug discovery, product manufacture,clinical trials and data management. Thus the mainstream BPO service providers requires special knowledge and skill set to perform the traditional life science functions such as clinical data management and monitoring of drug safety.

India happens to be one of the most attractive destination for such specialized functions due to low cost benefits and availability of high skilled work force.
Today, the Indian BPO companies are creating comprehensive roles for employees by expanding globally and providing them the opportunity to work on multiple verticals. It is indeed a fast growing industry as it provides ample opportunity for growth and entrepreneurship.

This change in the role of BPO sector from transaction-processing to high end specialized services has led to the growing demand of skilled workforce. Today the industry needs capability development. Even the professionals with degrees like M.tech,MBBS,MBA, CA, ICWA are taking up work in domain specific back office processes in advisory,analytical and consulting arena. This requires a clear relationship between IT/BPO industry and the academic world which train the workforce with industry specific jobs.
Nowadays even parents are becoming more supportive to the youngsters who want to join the BPO industry because they genuinely see it as a long term career. There is a realization that, BPO are not only about call centers but providing the right opportunities, skills and global exposure. In a nutshell the employees in the BPO industry are now getting challenging careers with tremendous job opportunities,hands-on experience,information about the culture and customs of various countries across the globe. This experience in understanding and appreciation of diversity is valuable for their personal as well professional growth.

Of late, BPO industry does get support from reputed academia. There are companies who provide training programmes specifically designed for the BPO sector in collaboration with some of the renowned institutions of India. More courses of this nature are being designed by other companies to provide outsourcing services. This one step forward towards making BPO as a long term career opportunity.
outsourcing.

Free ATM usage now curtailed!

Tuesday, September 1, 2009
You are an account holder of ICICI Bank and have withdrawn cash from HDFC Bank's ATM without any charge. Isn't it great? No need to look out for the ATMs of your bank. Just go to any ATM of any bank and withdraw money without paying anything.

Ofcourse as on date you can still do that but not with as much freedom and abandon! Why? RBI has now put a withdrawal limit of Rs.10,000 per transaction and restricted the number of such free ATM usage transactions to about five times a month. This has been done in response to IBA recommendations as the earlier RBI mandate did not fare well for the banks. Heres why:


History of free ATM usage

Before April 1, 2009, if you had to use the ATM of any bank with whom you don't have any banking relationship, you ended up paying fees. It meant you had to find the closest ATM belonging to your bank to withdraw cash and make balance inquiries. So RBI introduced a directive to the banks to allow free use of ATM machines irrespective of which bank a customer had accounts with.

This meant that irrespective of which bank you bank with, you could use any other bank's ATM free of cost. However the banks were only to charge for the cash withdrawal made by the customers by using their credit cards, while cash withdrawal on debit card was made free. So with effect from April 1, 2009, you could withdraw cash from any ATM free of charge.

Banks make a loss

However, this has not worked out in the favour of banks. Earlier when the use of ATM was not free, the interchange fee was borne by the customers. This fee covered the expenses incurred by both the concerned banks when a customer from bank A used the ATM of bank B. This meant bank A paid an interchange fee of Rs 18 to Rs 20 to bank B per transaction.

Once the ATM usage became free, this fee was borne by the banks. This made banks approach RBI through IBA, which is the industry lobby of Indian banks. They had submitted some recommendations to the central bank last month citing the financial burden faced by banks on account of huge number of third party withdrawals and small-ticket withdrawals.

One of them was to impose a withdrawal limit of Rs 10,000 per transaction at the third-party ATM as well as limit such transactions to 5 per month. The RBI after mulling over the suggestions has now agreed to both these recommendations and communicated the same officially to IBA.

Why did this happen

The underlying cause for this was the fact that most banks were losing money in comparison to the value of the transaction. So if a person withdrew just Rs 100, his bank ended up bearing this interchange fee, which worked out to be quite expensive. E.g. ICICI Bank is losing around Rs 4-5 crore (Rs 4-50 million) per month, as most of its customers have opted to use third-party ATMs.

Also, if a customer uses the free ATM facility for his current account, the banks not only end up losing money in the form of interchange fee but also have to contend with low float (balance in the account). This is because current accounts don't have requirement of maintenance of minimum balance and any money deposited here, doesn't earn interest. Hence, the banks' recommendations to impose limit on the amount withdrawn as well as number of free transactions.

Will free ATM usage fall out?

The recent announcement from RBI curtailing the use of free ATMs to five times a month and a upper limit of Rs 10,000 per ATM withdrawal, the joy of the consumer in availing this service has become shortlived. However, with people working 24x7, but banks not being open during that time, customers will always have a need to use ATMs of other banks.

Also certain banks don't have pan-India presence nor have multiple branches at various points. So customers of these banks will always end up using the ATMs of other banks. Hence, it is impossible that inter-bank ATM usage will see a fall out but will definitely come in handy for emergencies and urgent cash requirements.

RBI did take an innovative step by making ATMs free for all the customers of all the banks. However, as banks started losing money as the value of transactions at third-party ATMs did not justify the interchange fee, a sort of middle ground has been reached to keep both the banks and consumers happy.
Subscribe to: Posts (Atom)