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Rediff.com  » Business » BPOs eye global footprint to meet customer needs

BPOs eye global footprint to meet customer needs

By Shivan Shinde in Mumbai
Last updated on: August 17, 2009 11:59 IST
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A BPOThe Indian business process outsourcing industry is following in the footsteps of information technology service firms, increasing its global footprint as it eyes bigger and more complex work from clients.

The demand for global solutions is pushing Indian BPOs to grow aggressively into global centres, said a senior executive. For instance, in the past 18 months, WNS has expanded its presence in the Philippines, Romania, and now Latin America.

"All the important wins that we've talked about have a non-India component to them. This is very important from our perspective, as we talk about our global footprint, global strategy and global operations strategy," recently said Neeraj Bhargava, CEO of WNS.

Analysts believe the trend will only increase in the days ahead, as clients look for outsourcing partners that can support critical processes from multiple delivery centres.

"Gone are the days when you could deliver from just one geography. The multi-geography need is arising out of de-risking geography presence, need for specific skill and language capability. For instance, we have seen many clients prefer having a presence in the Philippines as a de facto to India," said Sabyasachi Satapathy, partner Tholons Advisory.

N V Tyagarajan (Tiger), COO of Genpact, believes that with global customers on board, Indian BPO players will have to expand their operations in other geographies.

He explains that if one is serving the Eastern European market, the service provider will have to be present in a country like Romania for language capabilities, "if you are serving the US financial sector, where English is the prevalent language then you can serve from India and the Philippines. Rather, clients are asking for work to shift to the Philippines, due to cultural affinity," added Tiger.

Genpact has centres in China, Guatemala, Hungary, India, Mexico, Morocco, the Netherlands, the Philippines, Poland, Romania, South Africa, Spain and the US.

"We have seen customers from the really badly hit economies, i.e. the US and UK, asking if a certain work can be done onshore. Besides, as relationship with existing clients deepen and as we do more complex work, we need to have onshore presence," said Tiger. Genpact also has ramped up its US centre numbers, especially high-end work.

Satapathy adds that clients were earlier more concerned about cost reduction, but now its about domain knowledge and skills. "Take procurement BPO. Indian players have not been able to succeed in taking this to an offshoring model. The reason being lack of right capability and skill of delivering. Nowadays nearshore, onsite capabilities are as important as offshore," he added.

Anando Mukerji, CEO of Firstsource, feels not having a nearshore or onsite presence means on business opportunity. The company has close to 4,000 employees in the US.

Its biggest centre, in Buffalo, has close to 600 employees. "We are ramping our numbers in the US. This quarter, we will add 100 more in the US as demand for work increases. One of the reasons for this is customers asking for higher onshore presence due to the protectionist environment, but for us, it is also coming from business needs," said Mukerji.

However, Sudin Apte, senior analyst, Forrester, believes that while clients are asking for Indian-plus-one geography, India will continue to get the bulk of work.

"The trend is across segments like IT services and product engineering, as well as BPO. This is happening due to the political environment and the need for derisking; constantly working at different hours is impacting quality and language and cultural issues. But 70 to 80 per cent of work will continue to be delivered out of India," added Apte.

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Shivan Shinde in Mumbai
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