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Skyline Business School |
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Skyline Business School |
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Issue:11
24/7 to double India staff to 7,000
24/7 Customer, a mid-sized back-office services firm, aims to more than double its
staff to 7,000 this year, as it rides an outsourcing boom driven by global clients. The
BPO solutions vendor will also invest $15 million in expanding its facilities in setting
up a centre overseas, either in Eastern Europe or Canada. Around $6 million will be
invested in a new 1000-seat facility inaugurated in Bangalore. 24/7 Customer, which has 18
clients in the financial services and telecom sectors, inaugurated a 1,000-seat unit on
31st March, Wednesday and aims to get it fully occupied in less than two months. The
hiring binge by 24/7 Customer, which currently employs 4000 staff, comes as competition
for talent intensifies from global giants such as third-party vendors Convergys Corp which
is furiously expanding in India. The company has received $23 million funding from Sequoia
Capital in June last year.
Source: The Hindu Business Line March 31st
2004
Kone to outsource R&D from India
The $5.3-billion Finnish major Kone Corporation is planning to outsource its
engineering and software research functions to its Indian subsidiary, Kone Elevator India.
The Chennai-based Indian subsidiary will soon double its engineering workforce to 60. At
present, Kone Corporation's research is done at various global locations like the US,
Finland, Italy and Germany. Research forms a core function of the Finnish major which has
just come out with a new technology in elevators, Maxispace, to maximise space in lift
cabins and ensure greater speeds.
Source: www.economictimes.com
April 2nd 2004
Market research BPOs expected to grow 100%
BPO units are specialising in market research a relatively new but high-growth part
of the BPO business. This segment has two kinds of players - global MR agencies that have
opened centres in India and other players that have market research BPO as only one of
their activities. Some of the companies operating in this segment are WNS, Taylor Nelson
Sofres (TNS), Ugam Solutions, Symphony, MarketRX, Millward Brown and Evalueserve. Industry
estimates of the size of this segment range from $5 million to $20 million. It is expected
to grow by 100% to 150% next year; much higher than the 50-60% growth rate expected for
the rest of the BPO industry. It is also high compared to the 10% annual growth
experienced by the Rs 300 crores Indian MR industry. TNS, a leading MR company that set up
a BPO outfit in India about three years back, is one of the few leading MR agencies to do
so. It focuses exclusively on MR-related BPO. Since market research BPO is at the initial
stage, companies operating in this segment have low profit margins. For example, MarketRX
has a net profit margin of 5%. It is expected that this segment will mature faster, as it
has a high-entry barrier. Simply put, new companies attempting to offer services in this
segment, may find it difficult to attain the expertise gained by the older companies.
Source: www.economictimes.com March 31st 2004
BPOs get small town mentality
BPO companies are getting serious on hiring from smaller towns. With large metros
such as Mumbai, National Capital Region (NCR) and even Bangalore getting rapidly
saturated, hiring from smaller towns has become a central part of their growth. Mr K
Pandia Rajan, chief executive officer, Ma Foi, a HR consultancy, said hiring from smaller
towns was becoming a key part of sustaining the rapid increase in headcount. The BPO
industry is in fact estimated to recruit between 20% to 40% of its staff from outside the
top eight cities in the country, such as Delhi, Mumbai, Bangalore and Chennai. vCustomer,
looks at candidates from a wide spectrum of cities such as Bhuvaneshawar, Vizag,
Chandigarh, Varanasi and Jaipur, according to Mr Sujit Baksi, vCustomer, India president.
vCustomer today has over 3,400 employees of which 20% are from non-metros. According to Mr
P V Kannan, chief executive officer, 24/7 Customer, B and C towns are the next source of
man power for BPO companies. He claimed that 24/7 Customer hired about 60% of its employee
base from smaller regions, varying from Gangtok and Guwahati in the North-East to Madurai
in the heart of Tamil Nadu.
Source: The Economic Times April 2nd 2004
Job rut over, 308,000 new jobs created in US
The United States smashed out of a three-year labour market rut in March,
announcing Friday a four-year record gain of 308,000 new jobs, which shocked financial
markets. The unemployment rate, measured by a separate survey, edged up to 5.7 per cent
from 5.6 per cent, the Labour Department said. The economy churned out jobs at the fastest
rate since April 2000, the clearest sign yet of a comeback from the popping of the late
1990s Internet bubble and the September 11, 2001 attacks. The jobs boom stunned financial
markets, breezing past private forecasts for a net gain of 125,000. It also has profound
political implications for President George W. Bush, with the November 2 election looming.
This is seen as a significant development in the wake of the outsourcing backlash that is
currently sweeping international political circles.
Source: AFP April 3rd 2004
South Africa Rivals India for Offshore
South Africa's outsourcing market could grow by 57% to $5.2bn by 2007, according to
research firm Gartner, highlighting the country's potential as an offshore services
location serving US and European corporate clients. The country's stable political and
economic environment, European time zones, and a large English-speaking population are the
main drivers behind growth. More companies outsourced to South Africa in August 2003 than
during the whole of 2002, with top names such as Barclays Bank and Virgin leading the way.
One of the main benefits that South Africa can provide outsourcing companies over India is
the amount of staff attrition. Indian BPO outsourcers are currently facing staff churn of
anything between 30% and 70%. However, attrition rates in South Africa are understood to
be considerably lower at around 6%. Nevertheless, South African call center workers are
still more expensive per hour than their Indian counterparts. For example, a South African
call center worker may cost around 8.50 pounds ($15.40) an hour, compared to the 4.00
pounds ($7.20) an hour for an Indian employee.
Source: www.cbronline.com
March 31st 2004
HLL to expand BPO unit
FMCG major Hindustan Lever Ltd's BPO operations in Chennai are poised for a major
ramp up in the coming months. National Center for Sales Commercial (NCSC), as this BPO
operation is called, is increasing its head count to 200 from the present head count in
the vicinity of 20. NCSC operations, which has been carried out from HLL regional office,
is now being shifted to a 15000 sq ft space in a central business district in Chennai. HLL
spokespersons refused to comment on the headcount, while admitting to the shift of office.
Source: Business Standard 30th march
Prepared by - Abhimanyu Puri, BBA-L1-S2
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