Bpo - Business Processing Unit

MARKETING RESEARCH .

BPO IN INDIA Compiled By Tasneem, Saurin, Shafi, Tommy & Murli

WHAT IS BPO? Business Process Outsourcing is the strategic use of outside resources to perform activities traditionally handled by internal staff and resources, none of which are core to the functioning of the company. It is a strategy by which an organization contracts routine functions to service providers who specialize in such functions. Thus the service provider is not only responsible for the execution of a business process but also for improving it

HISTORY OF OUTSOURCING 1776 :-Adam Smith discovered competitive advantage through outsourcing.  1970s-1980s :- C. K. Prahalad's core competency theory expounded in Harvard Business School. American Express, Swissair, British Airways and General Electric(GE) start captive units in India.  2000 :-Third Party players spring up in India. By 2005 end, over 300 open shop in India and beyond. Some of them even set up operations outside. 

MARKET SHARE 

The global BPO Industry is estimated to be worth 120-150 billion dollars, of this the Indian BPO is estimated to be some US $11.4 billion.



The $11-billion Indian BPO industry will reach $30 billion by 2012.

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The Indian BPO Industry employs 6,00,000 people approx.

GLOBAL GEOGRAPHICAL DISTRIBUTION OF BPO PROVIDERS

WHY INDIA AN ATTRACTIVE DESTINATION FOR BPO Low cost staff  Well positioned with ITES  Large pool of Skilled workforce  English Speaking workforce  Conducive Environment  Government Policy Support  Cost reduction up to 50%  Low infrastructure Cost  Favorable time lag:(12 hrs with US & 5 hrs with 

Europe) 

Improving Telecom Infrastructure to meet call centre requirements

SEGMENTS IN BPO ~Segments~ Customer Care Human Resource Finance Market Research Network Consultancy Technical Support Collections Transaction Processes Accounting Administration Training

CALL CENTER & ITS TYPES 

A call center is a centralized office used for the purpose of receiving and/or transmitting a large volume of requests by telephone for business specific purposes.

TOP 15 BPO COMPANIES IN INDIA Rank

Co.

Rank

Co.

1

Genpact

2

WNS(World Network Solution)

3

Wipro BPO

4

HCL BPO Services

5

ICICI One Source Progeon

6

IBM Daksh

8

Aegis BPO Services

EXL Service Holdings

10

24/7 Customer

11

MphasiS BPO

12

Intelenet Global Services

13

GTL

14

TCS BPO

15

Transworks

7 9

HOW MANY CALL CENTERS IN INDIA Result of a survey of 824 organizations throughout all the regions representing call centers  India, China, HongKong, Malaysia, Philippines, Singapore & Thailand  India, which now has the most call centre seats in the region, would see their number rise from 96,000 in 2003 up 65 per cent to 158,000 in 2004 

Martin Conboy,

(Chief officer of Callcentres.net)

WHAT SECTORS DO THEY SERVE?  Telecom

Industry  Travel & Hospitality Industry  Technology Industry  Banking/Financial services  Insurance Industry  E-commerce & Retail Industry  Industrial Sector  Distribution Sector & many more

SETTING UP A BPO  Background  Stability  Vision  Transparency  Market

Research  Employee Centric  Environment  Certificates

ATTRITION RATE IN BPO & OTHER SECTORS Sector

0-3 years

4-7 years

8-12 years

13+ years

Pharmacy & Chemicals

25%

10%

5%

2%

Manufacturing

8.58% 2.46% 2.46%

3%

Financial Services

20%

20%

20%

20%

Hospitality

35%

25%

20%

7.5%

Ad & Media

40%

35%

20%

15%

BPO

40%

30%

20%

10%

Automobile

7%

3%

2%

2%

Banking

10%

5%

2.5%

2.5%

Infrastructure

16%

11%

7%

11%

IT & Telecom

32%

25%

10%

5%

WHY DO COMPANIES OUTSOURCE? Reduce Cost.  Improve Efficiency.  Additional Expertise.  Specialized Technology.  Better Solutions.  Overall Development of Outsourced Process.  Concentration on Core Competencies. 

CURRENT AFFAIRS OF INDUSTRY Indian IT-BPO industry records an overall growth of 28% in FY 2007-08  USD 39.6 billion in FY06-07.  According to the annual NASSCOM survey: growth of 28% with revenues of USD 52 billion FY07-08  The Indian IT-BPO industry’s resilience is reflected in its FY07-08 with a 28.2% .  The target of USD 60 billion in exports by FY09-10. 

CURRENT AFFAIRS OF INDUSTRY CONTD… Barrack Obama outsourcing views and US presidential elections.  BPO increasing at an annual growth rate of 50% during 2004-06.  By 2006 will employ 0.4 million people  Financial meltdown in the US  Decline from 50% to 33% in finance and insurance sectors.  Estimated 5000-8000 lose job in BFSI  NASCSCOM: short term and company specific. 

FUTURE OUTLOOK o

o o

New horizon: specialized services to newly emerging industries like retail, fashion, apparel or automobile components Customer relation management (CRM). Improving between the government and industry.

FUTURE OUTLOOK o

o

o

o o o

CONTD…

Great number of employment up to 0.4 million Large number of English speaking college graduates. More and more foreign technological firms setting up Limited work skills and experience Neglect in the system Media industries

RISE IN RUPEE VALUE LEADS TO FALL IN OUTSOURCING  The

Indian rupee has been appreciated against the dollar in the last 1 year.  Core Objective of outsourcing to India has been affected.  Inflation in country has added problems.  The world economy is going through recession.  Better to have a job than to have no job

COUNTERACT  Flexibility



in Operations

Result Oriented Solutions

 Go

Beyond Cost Saving

 Develop

Knowledge Industry (Specific)

WHAT MORE SHOULD BE DONE ?  Farm

& Hunt Strategy should be implemented  Farm for more projects from existing clients  Farm for more projects from new clients  Hunt for new business in same industry domain  Hunt for new business in new sectors & Industries

WHAT MORE SHOULD BE DONE ?  People

seeking a career in BPO Industry should develop Industry Knowledge  Understand Retail & Banking better  Campus programme should be introduced in partnership of the BPO Co. to enhance curriculum & create sensitization  Industry should become more outcome based & think solution rather than just transactions.

Always make your total effort, even when the odds are against you.