Scoring with strategy
Rukmini Priyadarshini

Jostling for hits in the ITES-BPO arena are several players. Here's how each is making business tick..

THE growth in the Indian ITES-BPO sector is among the highest in the world. Indian companies - large and small - have gone all out to get a slice of the pie, with varying degrees of success. Several issues confront companies trying to make a mark in this space. The English-speaking workforce and cost advantages apart, what have Indian companies to offer? How can they better their value proposition? Does it mean moving up the value chain, offering core services, are there newer service areas to be identified and exploited? eWorld spoke to a few successful players to find out.

To provide contact centre services, for instance, it is important to have a well-architected solution that is robust, scalable and has a high degree of redundancy. These solutions are, of course, pretty much dependent on a well-trained workforce that can offer quality services, regardless of the mode in which end customers contact the company. For the third party service provider, customer satisfaction will mean savings/earnings/new business for the client. How can companies achieve all of these?

Gaining that edge

Dennis Ross, General Manager, Convergys Corporation, the world's largest provider of outsourced contact centre services, says it is the company's technology approach that clinches its competitive advantage. "As the largest such provider, Convergys starts in a position of advantage,'' Ross says. "In the Indian outsourcing market, three factors further strengthen that position. Our technology approach, where we provide our clients with systems that can be managed centrally, so that clients only have to make one change for that to appear anywhere on the desktop. This gives complete flexibility, minimises program releases and minimises rollout.'' Convergys handled 335 million call minutes in inbound traffic and 15 million call minutes in outbound traffic in 2002. "We met about 50 new clients last year for the Indian operations, mostly in telecommunications, financial services, technology and consumer products.''

Nilanjana Paul, Vice-President, Wipro Spectramind, says that apart from telecom and infrastructure solution and service delivery capability, quality programs such as the Six Sigma approach, together with COPC and Kaizen drive business process improvement. Notwithstanding all the processes and programmes in place, all outsourced contact centre service providers have found that their track record is vital in securing them a competitive advantage.

Business growth last year was strong, says P. V. Kannan, CEO, 24/7 customer.com, "Our existing Fortune 500 clients using our services and client references are our competitive advantage, apart from our top quality certification such as CPOC and ISO. The company handled over 18 million interactions last year, with over 40 per cent of them being outbound. It also signed on five Fortune 500 clients in financial services and high technology over the past year, Kannan says.

Having clocked three million calls last year, Wipro Spectramind's Paul too has something similar to say: "some world class clients with whom we have sizeable longer term engagements and contracts have provided us an opportunity to create a track record that we believe is difficult to replicate.'' New customers came from the travel and hospitality, BFSI, retail, telecom and ISPs, IT and health sciences segments.

BPO service provider India-Life Hewitt too has found that being the first and the largest in the space is an advantage in securing new clients as the latter want the benefit of a good track record and "the comfort of being in safe hands,'' according to Leo Fernandez, Vice-President. Having acquired 20 clients last year, the BPO service provider is riding high this year.

Selecting and training candidates to handle the contacts is a substantial part of the activity. "The ability to hire, train and motivate large numbers of people from very different backgrounds for very different types of processes and skillsets. Again, consistency and scalability is key,'' says Nilanjana Paul. Often, end-customer are exceptionally thorough and highly developed, including the way accent modification and corporate culture `mirroring' are dealt with.

"Unlike many providers, we focus our contact centre staff on a single client so they understand that client really well,'' says Ross. According to him, although Convergys employs about 4,000 people, it has a group of individual businesses, ``centres within centres.'

Moving up the value chain is the only way Indian companies can retain their competitiveness in the face of new and emerging offshore destinations such as the Philippines, South Africa and Australia. Indian third party players have had to start considering diversifying their operations to other competitive countries.

This move up the value chain involves offering data collection and analysis to clients, maintaining a data warehouse and running various types of analyses on information gathered from end-customers, upselling and cross selling, running campaign management, etc.

Ross says that at Convergys, the collection and analyses of data is a sophisticated component of service and if clients have no pre-set model, the modelling process really pays off in dealing with certain business situations. Similarly, 24/7 customer.com too collects and analyses data for customers. "We run a variety of analyses from churn analyses, pare-to analyses, campaign management analyses... '' says P. V. Kannan. However, Wipro Spectramind works on live client databases residing in the clients' data centres and often multiple sites access the same data.

As a result, says Paul, today the client does most of the data analysis. "We believe that this is a state of evolution and the customer's current mindset and the state of the industry. Based on some of the captive centres where our management has worked, we are familiar with this kind of work. We believe that the third party outsourcing industry will also evolve over time.''

Ultimately, outsourced contact centre/BPO providers can offer their clients value by ensuring cost savings/increased revenues or other tangible benefit, though the degree varies from client to client: Nilanjana Paul says WSM shows savings of 25-30 per cent. But the company offers value-add through direct revenues from inbound cross-selling opportunities, direct sales processes, customer retention processes etc that offer clients topline. Savings could move in a 30-50 per cent range, says Kannan, while India-Life offers 20-40 per cent savings on quantifiable cost.

But that is not all there is to the outsourcing story. As Ross succinctly puts it: "The savings/revenues angle may suggest that clients are outsourcing for financial reasons, but that isn't the full story — some of our clients have come to us because they have no way of delivering service to customers, and no expertise or technology.'' In that case, the cost-saving aspect is not the driver. It certainly provides them with an economic advantage from a number of perspectives. The notion that outsourcing offshore is primarily about labour costs is also a misunderstanding in the market — labour is only one piece of a complex solution and "we find that our clients, being global corporations, already know that to be the case.''