Outsource business process - Ignites the Indian economy

outsourcing has become an essential part of corporate business strategy to cut costs in these times, with the downturn in the US market. American companies have found countries like India, China and Philippines as ideal destination to set up call center service providers and BPOs.

India has been in the forefront of this trend especially since India has a huge student population proficient in English and a high unemployment ratio. Call centers and BPOs have not just come up in metro cities like Bombay and Delhi but even in smaller places like Chandigarh, Pune and Nagpur where infrastructure costs are lesser.

This trend has woken up the indian economy to a certain extent and promises to generate a lot of revenue for India. Predictions of $13.8 billion by 2007 makes the call center services and business process outsourcing industry very attractive as, not just a business proposition but also as a job provider.

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Outsource business process - The Latest news in the business

ACS gets Expanded BPO Contract with WellChoice

A world class provider of business process and information technology outsourcing solutions, ACS has been awarded a new and expanded business process outsourcing contract with WellChoice. Wellchoice, as you know, is the holding company of the largest commercial health insurer in the State of New York, based upon HMO and PPO membership. ACS will provide Business Process Outosurcing services such as mailroom, imaging, and expanded data capture services to support WellChoice's healthcare claims administration.

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Providing efficient BPO solutions has made India the hub of the outsourcing world. With industry experts very optimistic in this field, it has become evident that the business process outsourcing industry is going to generate a huge amount of jobs. In the latest reports, its estimated that outsourcing is going to create 10 times the jobs it has, by the year 2008.

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Outsource business process - UK investigating job losses

A house of Commons committee plans to investigate into the loss of jobs in call centers and IT from the UK to countries like India. Jobs moving out of the UK has perturbed many in the UK who think that the IT revolution should create some kind of a job miracle. They also plan to question global telecom giant BT over the loss of call center jobs in the Uk as part of a large enquiry into the subject.

Many American and Euoprean firms have set up call centers and business process outsourcing operations in India and other Asian countries because of the low cost at high efficiency factor and a large educated talent pool.

By end 2003, HSBC plans to employ 8,000 people in India, China and Malaysia while BT is planning to create 2,200 new call center services jobs in India. Aviva, offering insurance serivces, plans a 1,000-person call centre and claims-processing unit in India.

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Silicon Graphics plans to increase R & D outsourcing from India It is planning to invest in low -end as well as high-end jobs making it a one-of-a-kind outsourcer. SGI is investing in some R&D projects in India. The company has a wholly-owned software company Alias specializing in 3-D modelling, animation, entertainment as well as industrial designing and styling space.

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Outsourcing business process- the latest news

Among the profusion of outsourcing units set up in India, Promantra Synergies Solutions has set up a business process outsourcing unit in Hyderabad at Cyber Gateway, Hitec city. Its supposed to be the first healthcare BPO in India focusing on providing core processes to US healthcare providers.

This Hyderabad centre will have 30 seats initially and will increase it to 150 seats in a period of 6 months. Investment-wise, they are investing Rs 2.5 crore initially and will increase it to Rs 12.5 crore in a year.

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China wont be a threat to India in the business process outsourcing sector- So claim most industry experts, not just with facts and figures but with the trends and future investments in this sector and of course, English. This lingua franca of the business world still remains elusive to mainstream chinese business. With most voice-based outsourcing projects requiring a sound knowledge of English, China is sure to lose most of the business.

Besides this, China will take a lot more time to become really proficient in understanding and speaking English than is made out. China is definitely a threat to India but only in the long run.

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Outsourcing business process - Back to school!

Call center service providers and business process outsourcing operations have always faced a high attrition rate problem of almost 30-40% per year. In order to contain this problem, BPO firms have now tied up with management institutes to upgrade their employees' skills. AV Birla's Transworks with NMIMS,mumbai and ICFAI, Sitel India with Welingkar's Institue of Management have taken up this challenge to reduce the problem that plagues their industry in no small measure.

Most BPO employees are young and wish to pursue higher education resulting in higher attrition rates. By offering such programs with weekend classes, everyone's happy! The managment programs are also designed to suit the needs of the BPO and call center industry.

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Outsourcing business process - Into high skill zone

Outsourcing business process started off as a means for American companies to shed off laborious work like data entry and customer interaction. They found that India and other Asian that were confident with their English skills could do their job at nearly one-fifth the cost. This was just 3-4 years back...

Now, the Indian call center and BPO industry has come a full circle. They have entered into an area where they have started affecting the employability of their American counterparts. With more efficiency and better analytical skills, Indian companies have been able to corner the maximum amount of the outsourcing business and have gone on to vie for projects higher up in the value chain.

From outsourcing software projects to development centers in India to the humble call center, India has it all. The next boom is in the outsourcing of financial services. But this is after India has scooped nearly 60% of the $16 billion offshore information technology services market. Almost 2 million jobs are predicted to leave American shores for better quality and economical services in India in the finance sector.

In spite of the hue and cry over outsourcing in America, they realise that it is an economic necessity for them to sustain their corporations. The outsourcing and call center boom has created nearly 100,000 jobs in the last 2 years in the business process outsourcing and call center services market.

Most analysts say that the reason for the outsourcing boom in India is because Indians are good at analytics and mathematics. The signs that India is moving higher up in the value chain of outsourcing is evident from companies like GE Capital. It not only has a call center operation in India but also runs a "center of excellence," which analyzes credit card data and demand trends, with 400 on its staff.

The next natural step in this area should be of outsourcing business process from the design and improvement stage rather than just out-tasking projects. That will be the true test in this industry.

Outsourcing business process - latest news

Among a select group of companies, Cognizant Technology Solutions Corporation is a among the best offshore outsourcing firms in the 2003 Healthcare Informatics 100 list. With a combination of Healthcare Industry Expertise, Big Cost Savings and Technical Superiority, it has been able to increase its stronghold in the business with shrewd marketing innovation strategies.
Cognizant is expert at helping health insurers manage applications, integrate systems, comply with Health Insurance Portability and Accountability Act (HIPAA) regulations and outsource business processes through a unique on-site/off-shore model.

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With outsourcing being the new mantra on the cost cutting block, many companies follow the herd mentality and enter this sector without having any customized strategy. In a similar statement made by Gartner Consulting director Christopher Ganly, he says that most organizations have missed the point when it comes to BPO.

Many organizations that get into outsourcing tie ups only for cost cutting purposes, often unstrategically, end up ruing the fact that they incur more costs in some other parts of the organization. Often, these costs are uncontrollable and their quality of service suffers. A more holistic approach has to be taken while considering outsourcing decisions, he said. Any outsourcing decision should be based on sound strategy with a long term vision of the company in mind.

Outsourcing business process in India slated to become a soaring sector with revenues of $13.8 billion by 2007, according to Gartner. Whether companies can make tangible benefits out of this and improve their service, only time will tell...

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Outsource business process - the latest news

GE to provide third party business process outsourcing services

GE's BPO, which until now was providing business process outsourcing solutions to its multiple operations globally, is now going to provide solutions to third parties. Though still in the initial phase, this will add one more player in the highly competitive business process outsourcing industry.

It's BPO arm, GE Capital International Services (GECIS) provides backoffice operations for GE capital's businesses with a staff of 11,500. This move will not only bring down its costs but it can also use its expertise in multiple domains like finance and accounting, insurance underwriting, claims processing, industrial and equipment business, data modelling and analytics support. This can increase the competition in the business process outsourcing area.

Outsourcing business process has become a booming industry in the last few years with many American corporations prefering work done at a cheaper cost from Asian countries like India and Philippines.

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Outsourcing business process - News

Linux Vs. Microsoft

With outsourcing business process becoming a booming industry in India, software programmers have come into the limelight once again, after the dotcom boom. In this outsourcing frenzy major players like Microsoft are facing competition from comparative newbies, Linux. Linux developed by Linus Torvalds has developed a huge market in recent years. Nearly 10% of PCs in India will be sold with linux by 2004, from 0 in january last year. It costs a tenth of the windows operating system and has been able to capture about 20% of the server market. With most outsourcing projects dependent so much on IT services cost cutting and efficiency in softwares could give companies that edge over others in the outsourcing business.

Outsourcing has emerged as the new trend among american companies to cut costs and streamline business process. They have been able to use labor from asian countries like China, India and Philippines to create a market for such services. From its fledgling stages in the late 1990s to revenue projections of $13.8 billion for 2007, the business process outsourcing industry has come a long way.

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Outsourcing business process and BPOs - Giving rise to a new outsourcing business

The huge investment and opportunities in the BPO and call center industry has given opportunities for numerous ancillary businesses. BPOs and call centers themselves outsource a lot of their basic necessities giving rise to the 'outsourcing' outsourcing industry.

From canteens, transportation, facility management to training, numerous businesses have build around the BPO and call center industry. So much so, that many companies spend as much as 10-15% of their revenues on these essential services. Wipro's Spectramind, the largest third party call center in India spends nearly 8% of its revenues, that's 16 crore of its 188 crore(last year).

With attrition a major factor in the call center and bpo industry and with regular night shifts, transportation can often be a problem, especially in cities like Mumbai and Bangalore. To solve this problem, companies have had to hire transport facilities giving an opportunity to people like Jatinder Singh Grover, who incidentally ran a fleet operation of diesel buses in Delhi (he had to give this up when Delhi banned diesel buses in 2001). Starting from 2 Tata Sumos, he now has a fleet of 55 catering to call centers and BPOs. House-keeping has turned out to be a lucrative business for many and training for voice, English language and cultural nuances has become a part 'n parcel of running a BPO-dependent business.

The BPO-ancillary industry will grow as the Business Process Outsourcing and call center industry grows. With a projected $13.8 billion growth in the BPO industry, their seems opportunity for many such ancillary services. There is plenty of scope in this area with a projected Rs. 6,300 crore BPO-ancillary industry in the making. With Business process outsourcing units cropping up in metros as well as in small cities, ancillary services such as these cannot be far behind.

About 6 lakh jobs could be created just in support services by 2007. This surely is in India's favor, what with India being the hotbed of the call center and business process outsourcing industry.

The scope for the outsourcing and call center business to contribute constructively to the GDP is tremendous. Besides with unemployment being a major factor, call centers and BPOs will surely change the face of india's job market.

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Outsource business process - the future...

Outsourcing business process will have achieved its true purpose only when companies are able to take over an entire business process instead of just a particular task. At the moment companies replicate a particular task like data entry or collections. Companies outsourcing will have to give up the responsibility of the entire process and make sure that outsourcing companies handle everything from the redesign stage to the implementation of the process.

This is the future of the industry and true value addition to the outsourcer. This transition will take place inthe near-future as the industry heads for the consolidation phase and companies cut cost, with increasing competition.

Outsourcing has become big business as more and more American companies have shifted implementation of their business process to countries like India, China and Philippines. With projected revenues of $13.7 billion from outsourcing by 2007(gartner), getting optimized benefit from business models might be more profiable for long term strategy.

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Outsourcing business process News...

Sourcecorp, a leader in the outsourcing business process industry in the US has announced change in management with Joe Rose leaving the COO post to pursue personal interests. Ed Bowman, the President and CEO will assume the additinal charge, which he held previously from 1995-99.

IT security and outsourcing

Most firms that outsource their IT security function most often don't have security experts in their organisation. At BASF Malaysia, they found outsourcing their IT security a beneficial because they didn't have to monitor their network on their own. With security a 24x7 requirement they would have to hire an expert staff that would add to their overheads. This has made their system more foolproof and streamlined their organisation.

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Business process outsourcing news...

A fast growing business this...If you thought that the software business grew at a fast pace, check out the growth rates in the outsourcing and call center business and will be awestruck. Annual growth rates in the software industry over the last decade have been upto 40% mainly concentrated on the export market.

The Business process outsourcing and ITES sector now contributes a quarter of India’s IT exports and has created 160,000 jobs. It boasts of a 65:35 female-male employment ratio and also a fair amount of indirect job creation.

Nasscom has projections of upto 1 million direct jobs from the ITEs and BPO industry by 2008. This is largely due to outsourcing projects from the west. India has many positives to cater to the needs of the offshore BPO and call center industry;low costs, language, scalability and government incentives to this sector. Yet the business process outsourcing sector might not be able to contribute drastically to the Indian economy GDP-wise.

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Latest from the Business process outsourcing front

Reliance Infocomm, the e-baby of Reliance is planning big with an addition to its call center strength of 2,500. They offer customer care services to its existing cellular subscribers and has been used only for internal purposes so far. However, there are plans to extend the current set of services to involve high-end BPO services to external customers from other industry segments.

Profits for outsourcing business processes might stabilize at 20%

Business process outsourcing decisions could stabilize at 20-25%,say industry experts. With the increase in fly-by-night players in the BPO industry, even major players are finding it difficult to cater to the low pricing. Exchange rate fluctuations have also kept industry experts on their toes. For every 1% appreciation in the rupee value against the US dollar, there is an impact of over 1% on company bottomlines.

BPO services from India are projected to grow from $709 million in 2003 to about $2,572 million in 2006 at a 52 per cent CAGR. Whereas marketing BPO services will grow from $609 million in 2003 to $2,188 million in 2006 at a 62 per cent CAGR. In the current global economic climate, overall advertising budgets are under pressure.

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Business Process Outsourcing - the future of Chinese progress...

China and many countries in Asia started out as major manufacturing centers for european and american companies in the 1970s and 80s. Cut to the present, China is emerging as a major business process outsourcing center joining the ranks of India and Philippines. A short drive from the Guangzhou’s airport, you can see some progress in this direction, with Hong Kong’s PacificNet Inc.'s call center services operation and their 2,000 employees handling calls for telecom and insurance companies in Hong Kong, Taiwan, and China. It plans to expand its operartions to 5000 seats by next year.

In the outsourcing of software development, China is taking steps to catch up with India, with Accenture Ltd. opening a unit in the northern coastal city of Dalian. With a staff of 1,000 at its new center in Shanghai, BearingPoint Inc. (formerly KPMG Consulting) has plans to increase its staff by 600 by 2004.

Having focused on providing back-office support for financial service, telecom, software, and retail companies in neighboring Asian countries, China is realising the potential of learning English so as to cater to outsourcing business from English-speaking countries. China has a rosy future in the outsourcing business with projections of upto $5 billion revenues by 2005 and a whooping $27 billion for IT services by 2007.

Chinese officials are showing some interest in pushing this sector with partnerships with American and European MNCs. IBM has plans to set up training for 100,000 IT software specialists in various Chinese cities over a three year period.

It would an economic and political irony if American companies send outsourcing work and set up call center services in China, its political rival, resulting in Americans losing jobs to their Chinese counterparts.

China is keen on emulating India where outsourcing and call center service providers have mushroomed in the last few years. India is on a economic high with many companies keen on using this opportunity to improve market share and profits by investing in the BPO and call center industry.

Outsource business process- Catch 22

In the latest uproar against outsourcing business process, a Macomb county lawmaker wants to make his state the first to ban firms employing forieng workers from getting government contracts.
Ironically, when New Mexico officials sought to upgrade their computer network and create a cost-efficient,customer-friendly unemployment claims system, the $6 million contract was awarded to a company that works from India. A catch 22 situation, indeed!

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Outsourcing business process has become global trend in the last few years. With concerns over cutting costs and streamlining business processes, its not just a management technique but an economic necessity. The need to outsource was felt more out of the necessity to cut costs without companies having to build their own infrastructure and also getting access to proven domain and process expertise. In some cases where companies want to outsource their core business process, finding the right partner is of supreme importance.

Outsourcing has been around for quite sometime now, with outsourcing rampant in the travel industry. Localized travel firms were able to not only provide experts in the field but also negotiate better deals with airlines and hotel chains. Payroll and accounting have been some other processes that have been outsourced regularly.