Slowdown to benefit BPO industry in India

NEW DELHI: Indian industry will feel the real impact of the current meltdown in the US and other developed economies in the first quarter of 2009, with the business process industry likely to see job losses of up to a quarter of a million, said Samir Chopra, President, Business Process
Industry Association of India (BPIAI).

Addressing delegates at a session on 'Surviving US Recession- Developing & Transforming Policies', Chopra, however, saw a silver lining in the ongoing recession for the BPO sector, saying that it would compel more companies in the US and Europe to look at outsourcing as a way cut their costs and improve efficiencies.

South Africa: 2010 Opens BPO, Tourism Opportunities for Gauteng

Johannesburg – The Business Process Outsourcing (BPO), infrastructure and tourism are some of the opportunities presented by the 2010 Fifa World CupTM.
“In terms of business opportunities brought about by the 2010 Fifa World Cup, South African entrepreneurs can invest in infrastructure, particularly the maintenance of newly built structures, tourism and the BPO industry,” said Gauteng MEC for Finance and Economic Affairs, Mandla Nkomfe.
“The tourism industry is basically our new gold, as it contributes more than the actual gold mining industry does to the country’s Gross Domestic Product [GDP],” highlighted the MEC.
Speaking at the biggest inter-business soccer exhibition in the world, Soccerex 2008 on Wednesday, Nkomfe indicated that Gauteng was also the home of the BPO industry or call centre industry in South Africa.
Over 70 percent of all call centres in the country is based in Gauteng, he said, adding that in recognition of the importance of this industry, both IBM and Virgin Mobile have located their call centres in Gauteng. more

BPO vendors see larger US deals by year-end

Clients expected to complete internal evaluation process by then

Mixed fortune

It is a temporary slump in offshoring due to the US credit crunch and the BPOs expect the same factors to fuel increased demand for outsourcing by year-end.

The uncertain environment has indeed forced client companies in the US to ‘reprioritise’ and ‘review’ their roadmap for the future
Adith Charlie

Mumbai, May 4 Is recession good or bad for the business process outsourcing sector? Probably both! Recession in US seems to be a mixed bag for Indian BPO vendors.

They do agree there has been a temporary slump in offshoring due to the US credit crunch, but expect the same recession-related factors to fuel increased demand for outsourcing by the end of the calendar year.

Both IT and BPO companies are witnessing a spate of project delays and cancellations, especially in the financial services space, due to recession in the world’s largest economy. It must be noted that clients can save up to $5 million in costs annually if they enter into a major outsourcing contract. So why are the US companies going slow on their BPO engagements even when they want to cut costs in a recession?

Says Mr Raju Venkatraman, Joint Managing Director and Chief Operating Officer of Mumbai-based Firstsource Solutions, “When a company is hit by a crisis that is at least 100 times bigger than the cost benefits that outsourcing will bring, would it think about saving $5 million a year or find solutions for the bigger problem?” Outsourcing is important, but not a priority in a crisis-like situation, he adds. - Source

BPO.biz : One stop bpo resource - BPO Portal launched.

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5 Indian cities among top global outsourcing / BPO hubs

Reflecting the immense potential of India's information technology and outsourcing prowess, five Indian cities are among the top 10 global emerging outsourcing destinations with Chennai topping the list.

Among the top 10 cities, Hyderabad is ranked at the second position followed by Pune (3rd), Kolkata (5th) and Chandigarh (9th).

The study jointly carried out by Cyber Media's Global Services magazine and investment advisory firm Tholons has drawn up a list of 'Top 50 Emerging Outsourcing Cities' and India is represented with six cities including Coimbatore (21st) while China has five cities.

The Philippines city of Cebu (4th), Vietnamese city of Ho Chi Minh (6th), Colombo (7th), Shanghai (8th) and Beijing (10th) have also found a place in the top-10 chart.

"With the demand-supply gap widening, newer Tier II cities will play a critical role in re-engineered globalisation models," said Tholons Chairman and CEO Avinash Vashistha.

Low cost, developed infrastructure, skilled workers and low attritions are the main reasons for Chennai bagging the top spot.

"Chennai is expected to house more than 73,000 workers of the top three Indian IT companies (TCS, Infosys and Wipro) by 2010," the report said.

In addition, it point out that Chennai is an established location for automotive engineering services, product development and health care BPO. It also houses big names like Accenture, Cognizant, TCS, Infosys, IBM, Satyam and Sun Microsystems.

Next in line to BPO and KPO is EPO (Engineering Process Outsourcing)

Next in line to BPO and KPO is EPO (Engineering Process Outsourcing), which is expected to grow 10 times over the next seven years. The EPO is also likely to promote India as a major hub in this part of the world. Industry analysts believe that if EPO maintains to keep consistent pace it is likely to touch USD 30 million.

The Indian Governments Commerce Ministry came out with a report citing that over the last couple of years (2004-06), the demand for Engineering Process Outsourcing to India has grown at a rate of 30-35 percent and this is likely to add momentum in the coming years.

A study conducted by the state-run Engineering Export Promotion Council (EEPC) says, "The global EPO market, is expected to grow at a rate of USD 110-140 billion by 2015 taking Indias share to 20-27 percent". Taking into account Indias last year (2006-07) result that touched USD 26 billion the EEPC is expecting the industry to grow substantially.

Call center / BPO and Outsourcing Jobs - A win-win situation

Reiterating the economists and the sociologists, the cheap labor in India owes its origin to the high rate of unemployment here. Hundreds of thousands of graduates are jobless and desperate for work in India. With higher studies only an option for the affluent, professionals too are facing increasing difficulties in recruitment. And as far as skilled labor is concerned, it is limited to few technical branches of work. Here is where the call center industry fills the gaps.

Call center units are not very demanding as far as qualifications and prerequisites are concerned. Most call center jobs require a basic understanding of computers and a good grasp over English. And the urban youth of India are computer literate graduates with a command over English language. This is the ideal unskilled labor that the call center industry is looking for.
Call center executives only need to be trained in soft skills that include voice neutralization and accent training. This helps to give them an accent more familiar with the people they are going to be talking to. For Indians, this is a smooth transition. Ours is not a country that has evaded the influence of the West and Americanism has seeped into our daily lives like ink on blotting paper.

Best BPOs / Top 10 BPO companies

1 IBM Global / Daksh
2 Accenture
3 Hewlett Packard
4 MphasiS
5 Ernst & Young/Capgemini
6 Wipro Spectramind
7 ICICI One Source
8 eFunds Global Outsourcing
9 Convergys
10 Affiliated Computer Systems

Golden rule for BPO success

New Delhi, Feb. 1: The country’s software services and business process outsourcing (BPO) companies can realise $60 billion in export revenues by 2010 if they reduce operational costs and improve profitability, the National Association of Software and Service Companies (Nasscom) has said.

India is now the leading destination, having captured 65 per cent and 46 per cent of the global offshore IT and BPO markets respectively.
“As the market leader, it is imperative that we continue to set standards for the global industry. IT and BPO centres in India must now provide additional benefits such as speed, flexible operating models, innovation and productivity enhancements, which can be achieved by excelling in operations,” Nasscom president Kiran Karnik said.

outsourcing contract questions, why you want to buy bpo?

Outsourcing contract? You should be able to tell your prospective vendors:

What you want to buy;
How you want to measure results;
How you plan to manage the relationship;
The price you want to pay.

Protecting Buyers In A BPO Contract

Business Process Outsourcing (BPO) can give companies a decided advantage in today's marketplace. However, four legal issues have the power to derail an outsourcing contract's success. If buyers include legal protections in their outsourcing contracts, they can enjoy the advantages BPO outsourcing brings, according to attorney David Pace, a partner in the Dallas office of Arter & Hadden LLP.

BPO is growing because companies want to focus on their core businesses. Pace says there is a growing sense in today's marketplace that companies need to shed their ancillary processes. "Then they are not distracted from focusing on what they do for a living," he says.
BPO also provides an accounting advantage. If a buyer sells its plant and equipment to the outsourcer, these items disappear from the asset side of the balance sheet. Now there's no need to depreciate them over a number of years. Instead, these costs migrate to the expense side of the ledger as a cost of goods sold. Companies can deduct these expenses in the year they were taken, if it so chooses. Pace calls this "financial engineering."

Outsourcing a process also means the buyer no longer has to manage the head count. This is an attractive benefit in today's tight labor market. The unemployment rate in May was 4.1 percent. Recruiting and retaining talent in a tight market is difficult. The level of difficulty increases with the specialized knowledge required. The outsourcer, on the other hand, is adept at attracting the best and the brightest in its field.Outsourcing a process also means the buyer no longer has to manage the head count. This is an attractive benefit in today's tight labor market. The unemployment rate in May was 4.1 percent. Recruiting and retaining talent in a tight market is difficult. The level of difficulty increases with the specialized knowledge required. The outsourcer, on the other hand, is adept at attracting the best and the brightest in its field.

source and full story:
http://www.bpo-outsourcing-journal.com/jul2000-legal.html

IBM - From Business Machines to Business Methods

IBM's direction marks a shift from its storied history as a computer industry bellwether. For decades, IBM concentrated on machines to carry out accounting and computing tasks. IBM was behind the curve on the emergence of the personal computer, and though it later gained ground against companies like Apple Computer, IBM was slow to adapt to the changes it brought in the marketplace. By 1993, the company's annual net losses reached a record $8 billion. Lou Gerstner, who took the reins of the company in 1993, is credited with emphasizing services as a key to the company's turnaround. Nearly half of IBM's $89 billion in revenue last year came from its services unit. (Gerstner's turnaround strategy is highlighted in a new book from Nightly Business Report and Knowledge@Wharton titled, "Lasting Leadership: What You Can Learn from the Top 25 Business People of Our Times.")
IBM became a leader in IT outsourcing, which refers to a company farming out work such as managing central computer centers or handling technical support calls. Big Blue began extending its services reach from the technology arena to business tasks about the time the company acquired the consulting wing of accounting giant PricewaterhouseCoopers, in late 2002. The roughly $3.9 billion deal was a landmark move. IBM combined the roughly 30,000 employees from PwC Consulting with about 30,000 IBM workers to form a new division called Business Consulting Services. The idea behind the acquisition and new unit was to generate revenue by joining IBM's technology prowess with PwC Consulting's business expertise. Analysts say the PwC Consulting deal has helped IBM compete in the BPO arena.

source and courtesy: http://knowledge.wharton.upenn.edu