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Saturday, Sep 25, 2004

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`Indian BPO firms must get aggressive to beat competition'

Our Bureau

Bangalore , Sept. 24

INDIAN BPO firms need to polish their knowledge training and retention skills if they are to tackle the slew of low-cost hubs such as Mexico, the Philippines, East European countries and even China. If India has to retain its competitive edge then the country's back office processing providers have to deal with issues such as high attrition rates, unclear taxation policies and new business paradigms such as transactions-based payments instead of per man per hour billing rates.

At the first day of the `Regional seminar on tax implications-BPO & software industry,' various industry experts from the BPO sector and chartered accountants outlined the immediate concerns that the Indian BPO sector needs to address.

"Organisations (read BPO customers) are now looking at outsourcing their processes to low cost destinations so Indian firms need to keep their cost competitiveness in place and in this regard attrition is a key concern," Mr Jacob Parambi, Vice-President-Operations, IBM Global Services India Pvt Ltd (BTO Operations), said.

According to Mr Parambi with non-English speaking countries such as China making English a part of the educational curriculum it will not be long before it is able to offer a low-cost hub for BPO services.

Hence, Indian firms need to incentivise and provide knowledge growth to retain employees. If the attrition rates hovering in the 30-60 per cent range are not controlled, then it would raise the costs of Indian firms. Besides this, the ambiguities in domestic taxation as also the infrastructure need to be corrected, he said.

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