This report discusses the concept of BPO , its entry in the Indian markets , its reasons for doing so, its present and projected growth, the competition given to the Indian BPO industry by the developing BPO demand in China and also discussing the BPO industry and its growth in China and the major catalyzing factors taking the BPO to the Chinese markets. BPO industry in Indian is fuelled and propagated by the youth and it is the presence of this youth that this particular industry has been able to penetrate the Indian market and attain the spectacular lightning fast growth that it has The demand for BPO industry came as a majority from students who wanted to bear their own expenses or get some more “fun” money. This seemingly innocent demand by the youth has given birth to an industry so massive that yet in its cradle, the BPO industry has become a colossal giant, loosely organized, yet powerful, and matter of fact so big that its contribution towards the Indian GDP is a 2.5% and growing by 10% per annum. While the majority of the force in a BPO is constituted by the youth, suffice it to say that it is governed by the iron fist competitive matured market players deeply seated in the worlds IT market.
BPO – Business Process Outsourcing – An Introduction
Business process outsourcing (BPO) is a broad term referring to outsourcing in all fields. A BPO differentiates itself by either putting in new technology or applying existing technology in a new way to improve a process. Business Process Outsourcing (BPO) is the delegation of one or more IT-intensive business processes to an external provider that in turn owns administers and manages the selected process based on defined and measurable performance criteria. Business Process Outsourcing (BPO) is one of the fastest growing segments of the Information Technology Enabled Services (ITES) industry. Few of the motivation factors as to why BPO is gaining ground are: * Factor Cost Advantage
* Economy of Scale
* Business Risk Mitigation
* Superior Competency
* Utilization Improvement
Generally outsourcing can be defined as - An organization entering into a contract with another organization to operate and manage one or more of its business processes.
In the early 1980s several European airlines started using Delhi as a base for back office operations, British Airways being one among them. The BA captive was finally spun off as a separate organisation called WNS Global Services in 2002. Amex
In the second half of the 1980s, American Express consolidated its JAPAC (Japan and Asia Pacific) back office operations into New Delhi and NCR region. This center was headed by Raman Roy, and has been a source of several leading names in the Indian BPO Industry. General Electric
In the 1990s Jack Welch was influenced by K.P. Singh, (A Delhi based realtor) to look at Gurgaon in the NCR region as a base for back office operations. Pramod Bhasin, the India head of G.E. hired Raman Roy and several of his management from American Express to start this enterprise called GECIS (GE Capital International Services). Raman for the first time tried out voice operations out of India, the India operations also was the Beta site for GE Six sigma enterprise. The results made GE ramp up their Indian presence and look at other locations. In 2004 GECIS was spun off as a separate legal entity by GE, called Genpact. GE has retained a 40% stake and sold a 60% stake for $500 million to two equity companies, Oak Hill Capital Partners and General Atlantic Partners. Third party BPO's
Until G.E most of the work was being done by "captives"- a term used for in house work being done for the parent organisation. In 2000 Raman Roy and some team members from GECIS quit , and with VC funding from Chrysalis Capital started Spectramind. At the same time an organisation called EXL started in Noida and Efunds started in Mumbai and...