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BS Roundtable: 'It's an exciting time to be in the BPO business'

Business Standard 

(From left) Mohanakrishnan P, Sandip Sen,Keshav Murugesh and Mohit Thukral at the Business Standard round table at the Nasscom BPM Strategy Summit in Bengaluru
(From left) Mohanakrishnan P, Sandip Sen,Keshav Murugesh and Mohit Thukral at the Business Standard round table at the Nasscom BPM Strategy Summit in Bengaluru

At the roundtable with Business Standard, leaders representing large (BPM) services providers talk about what has really has changed from the earlier period till now, which makes this space so exciting. They also talk about how the sector is repositioning itself, not only in branding but also offering more value-added services, while keeping the capital expenditure low. This edited excerpt captures some of those discussions:

Good time to refocus on India market

Sandip Sen, Global CEO, Aegis: I think significant change has happened and lots of those have been very positive. The first is, of course, related to the whole digital commerce or e-commerce businesses of the Flipkarts and Snapdeals of the world. Flipkart, if I can remember those days, used to say they want to do Rs 100 crore a year. Now, they are trying to do $1 billion in only four days around Diwali, which is around Rs 6,000 crore. In the end, what is really going to differentiate these is the entire quality of customer service, which is the front-end and back-end. So, for them, partner like us and the others are very important.

Second, if you look at telecom companies, a lot of their business used to be pre-paid. Today, telecom is about data and video, which is going to make their average revenue per user much higher. Thus, the kind of service these customers require and the kind of queries they might be having are much different. The other thing is about financial services, with lots of investment expected to come with the increase of foreign direct investment cap to 40 per cent, and the drive towards financial inclusion. So, I think you are going to see a huge upsurge in business here.

Global clients favouring variable cost structure

Mohit Thukral, Sr VP, Genpact: Most customers globally are getting to a variable cost model because they don't want to have cost of infrastructure and fixed cost. They are rather willing to find people like ourselves who will invest and that will give them the variable cost structure. in the US learnt this in the downturn of the economy. Now, in the upturn, when they are sitting at about three per cent annual GDP growth from minus 1.1 per cent six years ago, they are not getting into the mode of massive hiring. What's happening is that they are driving some of their cuts with the use of technology and then leveraging partners like us, globally. That's creating some leverage and momentum for companies like us and others. If you track most companies like us, I think they are feeling much better about this year and obviously about the future.

Demand from traditional customers

Keshav Murugesh, Group CEO, WNS: Traditional customers who are outside of India are constantly reaching out to us to come up with new and innovative models which can help them stay ahead in the curve. For example, today, we (WNS) made an announcement about four new digital platforms, in the travel space. If you look at it, it's a very simple thing. Till now, for many years, airlines were only focused on sales, revenue audit, managing frequent flier programmes, etc, and all of us did exceedingly well in those. Earlier, they were not very open to new ideas, maybe because they were so stressed. Today, everyone is quite worried, asking who is going to be the next disruptor.

People and Quality

Mohit Thukral: You get good talent but also need to build talent. All of us have invested on skilling people because that is the game. In the early years, we hired from the top pool, so some of the layer in the middle are very good, though many of them need to be skilled, refined, polished. Earlier, most of us used to go to colleges individually, train people and hire them. In the recent past, lots of changes have happened. For example, the industry players in association with Nasscom are working with colleges to build curriculum over a three-year period. That will help in getting talent in areas like finance & accounting (F&A), analytics, etc.

Sandip Sen: Our focus is to create a supply pool and create (business process outsourcing) as a career and not only a job. The common perception about this sector is that it's a call centre job. We want to get rid of that myth, particularly in colleges, the places where the talent basket comes from.

Second, as part of the new effort, the Nasscom Business Skill Council is building curriculum. has played a major part in building the F&A curriculum and get colleges to adopt that. We need the help of influencers to say where the BPM industry is going. It's important that we are able to articulate often enough that this industry is where one can build a career. Notwithstanding the challenges, what we feel is the government should do more, especially in tier-III and tier-IV towns.

Infrastructure key hurdle in smaller cities

Keshav Murugesh: Recently, the Government of India came up with a BPM policy. We were not happy with some elements and had discussions a couple of weeks ago. They are changing it. Some of us are also involved with state governments which are trying to attract investment into tier-III and tier-IV cities. But, it is really difficult at the present scenario. We are telling the chief ministers and information technology ministers of the states that when they announce policies, they should not confine it to real estate, on giving discounts, etc, on land. We are telling them that if you want to get investment into tier-III and IV cities, the new policies should be all about governments creating infrastructure in these locations, giving it free of cost for seven years or so, creating housing inside these Special Economic Zones which should be rented out at subsidised rates to employees who work there. We are asking them to create railways, airports, and roads, so that we can take clients to these locations.

Mohit Thukral: This is the model China has followed really well. They went to their tier-III, tier-IV cities, created world-class plug and play infrastructure, and gave the industry everything required to set up centres.

First Published: Sat, September 26 2015. 00:20 IST