Identity crisis for BPOs

T.E. RAJA SIMHAN | Updated on August 02, 2012 Published on August 02, 2012

Over the years the BPO sector has matured from just a call centre category to doing high-end work like analytics and back end processing for banks and financial institutions

Call centre firms are desperate to get rid of the party goer’s image linked to the job

There was a time when jobs at call centres would be associated with fresh graduates just out of college, ready to party at the drop of a hat and willing to stay up late for extra bucks. Over the years the Business Process Outsourcing (BPO) industry has matured from just a call centre industry to doing high-end work like analytics and back end processing for banks and financial institutions. But the old image still lingers on.

“The BPO sector is still considered to be a ‘night shift-oriented’ and that it is meant for ‘party goers.’ This is completely wrong. The industry should present BPOs as a career choice for youngsters. There is a huge opportunity in this sector,” says Keshav Murugesh, CEO, WNS Group, a large BPO company employing nearly 25,000 people in ten different countries.

BPO firms feel that their industry has never come out of the shadow of its big brother - the Information Technology sector. That’s despite the fact that the BPO exports touched $16 billion in financial year 2012, growing by over 12 per cent over previous year. The industry employs nearly 8.6 lakh people, according to industry association, Nasscom.

Ask people in the BPO industry and they will admit that there is a severe identity crisis. They feel unlike the Philippines, India has not propagated the BPO industry.

“The IT sector is still considered a premium over BPO, which ‘hurts our industry,” says Murugesh.

Agrees Mohit Thukral, Senior Vice President and Head of Global Financial Service and Insurance, Genpact, “India did not feel pride in its BPO industry unlike the Philippines. The industry is not just about doing a back office. We are dealing with critical things for customers.”

The BPO industry employs professionals like CAs (WNS itself has around 5,000 of them), PhDs, Doctors and analytics experts. “We even have veterinary doctors in our industry. However, the change has not been recognised. This industry has not gained recognition that it deserves,” the WNS chief said at a recent Nasscom’s HR Summit.

According to him India has not propagated the industry well. “For example, why not take one child from the farming sector and provide him/her a guaranteed job in the BPO sector. This makes easy for the sector, which recruits nearly 50 per cent of its employees from smaller towns,” says Murugesh.


According to Adwaita Govind Menon, Associate Director & Head - New Products, IDC India, the BPO industry is witnessing a period of identifiable change. While labour arbitrage was the primary driver for growth during its nascent period, the mature landscape today demands cognisance of factors such as time to market, talent, quality and productivity without overtly dislodging the cost competitiveness.

“We have developed as an economy and the standard of living has improved in the BPO destinations of India. The BPO salary levels have not improved in the same rate neither have the rates being charged by BPO companies to clients,” says Menon.

Given the cost constraints, the talent crunch and the overall image, the gainful human resource for this industry is today available not in Tier I or Tier II cities but Tier III and Tier IV towns.

IDC research shows that the IT supply ecosystem is yet to catch up with demand in these Tier III and IV towns. “If you contrast the offshore locations that have emerged over the past few years outside India, they compare well with our Tier III and IV towns (and not Tier I and II cities). But most of our BPO revenues even today come from the establishments in tier I and II cities”, says Menon.

But Som Mittal, President, Nasscom, vehemently refutes the claim that the BPO sector is neglected. “This is not true as BPO is an integral part of IT. The industry has been growing rapidly for us.” Nasscom has a senior vice president focus on the BPO sector. It has an apex committee and a separate council for the sector. They have identified five or six areas, including talent, to work on.

“Our own companies are growing in China and Philippines. It is incorrect to say that we are neglecting the BPO industry. Even in our executive council, we have very wide representation from the BPO industry. It is a perception issue, and we need to handle it,” says Mittal.

Jaya Vaidyanathan, Executive Vice President and Head – Chennai, Technology and Strategic Transformation, Scope International Pvt Ltd, says the BPO industry has moved from the ‘party goer’ industry image to a mature industry. “However, we need to showcase the youngsters that this industry has enough career opportunity – both in terms of gaining domain expertise.”

For example, the Scope centre in Chennai used to do payment process but is now doing security process and custodian process. Some even have moved to banking in certain areas. Scope in Chennai has grown to over 10,000 people in last ten years.

Limited talent

“We need to look at new talent from untapped sectors, including agricultural, rural, tribal people, disadvantaged and differently-able people. We need to look at product innovation and constantly look at what the customers want,” she said.

Others like Aparup Sengupta, Managing Director and CEO, Aegis Limited argue that the BPO industry is not facing an identity crisis but is fighting a perception crisis, especially in front office outsourcing where the North American customers are getting more inclined towards Philippines as an outsourcing destination. “This however does not in any way undermine the potential of the Indian BPO industry in back office activity,” says Sengupta.

BPO firms are hoping that the Nasscom and the Government would work together in helping the industry ‘rebrand’ itself and be a choice of work for the youngsters.

“Nearly 30 million students pass out of the colleges every in India and China. However, only 12 per cent of them get employment. There is enough scope for students to get in to the BPO industry,” says Genpact’s Thukral.

Published on August 02, 2012
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