The Future of the BPO industry - 1

The Business Process Outsourcing industry - considered the next growth engine for India - is the point of discussion in many places around the country. I will try to analyze the industry and look at problem areas and possible solutions.

The 5 things important to this industry is

Organizational Expertise
Domain knowledge and Project execution capabilities
People – Expertise building and Human Resource Management.
Client Management - Building relationships
Service delivery - Meeting and exceeding accepted measurements and delivery standards.


One of the aspects of this Industry is that India does not have any experience in working with long-term(5-10 years) and super longterm (>10 yrs) kind of projects. Say, we have never had any manufacturing bases or service industry to support other countries over an extended period and supporting other countries in their work. This kind of experience is very valuable.

The BPO projects in the country are of this nature. They are people and labour intensive but they are also long-term(5-10 years) and super longterm (>10 yrs) kind of projects. Also, most of these projects are indispensable for the organization which has outsourced the project. The implications of this is something which needs to be thought off.

The other important aspect of these projects is the real-time processing and completing aspects of the job. The service delivery standards are around 15 min - 4 hours and not 2 weeks to 5 months and more in relation to software projects. This is important to understand in terms of the project management skills and training required for the personnel.

The third aspect is "night shift". This has a tremondous impact on the people who work on these projects and for how long. What does these mean to the growth of the Industry?

I will first look at the "People" problem.

The kind of people who work on these projects in the US are mostly X or XII standard pass/fail people with team/projects lead undergrads or graduates. In India the most common qualification is undergraduation and post-graduation going to MBAs etc. Due to the longevity of the projects - some of the projects have been in the US for 40 yrs before they were outsourced to India - the personnel working in the project need to work longterm to stabilise the project. Due to the mismatch in the qualifications and job profiles this cannot be expected to happen in India.

These projects are also cyclical - the business volume is not the same all through the year - this was solved in the US through the "temp" worker. This concept is alien to the Indian BPO and IT business community and for graduates this proposition cannot be accepted.

Now comes the stress of the job - repetitive, transaction based, on computer jobs - with small turnaround time and high quality expectations. This will create a stress job role which is not possible to continue for long. Add to this the "night shift" aspect with its own set of related problems and you have a major people problem.

You can also add poaching by other companies, high turnover rates, salary pressures inturn margin pressure etc.

Considering this scenario what shold be the possible HR efforts required?

To be Continued