The Future of Indian BPO companies-2012 and Beyond

January 2, 2012

Since 2010, Indian BPO companies are in a buying spree. The value of BPO mergers and acquisitions might exceed several billion dollars. The main reason behind BPO industry consolidation is due to the change in customer demand and their business requirements.

The cost arbitrage days are gone for Indian BPO companies; they no longer can win the contract simply by under-bidding their competitors. Following are some the capabilities customers are looking from their BPO vendors:

Unified ITO & BPO Solutions
In this ever changing and hyper-competitive globalized world, companies need both IT and business process solutions to keep their websites up and running 24×7. These customers view their IT and business processes as single intertwined systems that needs to serve their customers all over the world.They expect their BPO vendors to support their IT systems as well. So pure-play BPO vendors cannot bid those projects, as their capabilities are only in BPO.

Managing Business Process Value Chain

Customers are managing their end-to-end business process that spans several time zones and countries. Now multinational companies (MNCs) have manufacturing divisions in China, US, and in other countries. Their customers are located all over the world. They can buy either by visiting their physical store or simply through their website. Now MNCs need their BPO vendors to understand their entire business process value chain and offer localized, country-specific solutions. Small and midsized Indian BPO vendors (vendors with a revenue of less than $100 million) cannot even bid these BPO projects.

Innovative BPO Solutions
Companies are not looking for simple BPO solutions in contract. They are interested in innovative business process solutions that gives them an edge over their competitors. For example, customers interested in financial and accounting outsourcing are not interested in plain “vanilla” solutions like bookkeeping, account receivables, and account payable. In contrast, they are interested in solutions that will reduce their billing cycle, dynamic pricing, and globalized view of their financial and accounting data. Only niche BPO companies like Genpact can play in this market.

Platform-Based BPO
In this cloud computing era, customers are interested in SaaS solutions in which they use their supplier’s infrastructure to get utility based services in accounting, HR, procurement, and business analytics. Only big Indian outsource companies like TCS can offer these type of solutions.

Location-Based BPO Solution
In this globalized world, all the Fortune 500 and midsized companies have research labs, warehouses, data centers, and retail centers located all over the world. They also have employees, vendors, and partners working with the companies on various engagements throughout the world. Companies are looking for an integrated but localized BPO solutions to support their global entities. Only Indian Companies those who have offices in multiple countries can take advantage of their localized presence to win these BPO projects.

Global economy is still recovering in 2012, with current dept crisis in Europe and US election in 2012 will create tough-time for Indian BPO companies to win new BPO contracts. But by understanding the customer’s BPO needs, having a sound marketing strategies and having a good globalized BPO delivery capabilities, Indian BPO companies can still win new BPO projects.


7 Responses to “The Future of Indian BPO companies-2012 and Beyond”

  1. Calvin on March 19th, 2012 1:53 pm

    Comcast or Xfinity outsources over 50% of their work to countries like India and Mexico. It’s a shame because the people that keep them in business suffer including their own employees. The people working in India and abroad are not the problem, it’s the capitalist society in which they live in that is. Average wage for India customer service rep is approximately $190-$200 per month of 160 hours worked. That is the problem.

  2. Facility Management Services on June 7th, 2012 7:08 am

    BPO is spreading their steps very rapidly in India. One the only reason is “low cost”. Western companies find employees at cheapest rate in India rather in their own country.

  3. Rupesh singh on June 19th, 2012 10:18 pm

    hello actually i wanted to open a BPO shortly But dnt hv much idea about that, how to get good contracts and i want to open it in RAIPUR ( CHHATTISGARH).. CAN u will help me out of this.

  4. Danie Jomes on August 30th, 2012 4:22 am

    This blog post is really informative, Innovative BPO Solutions and Platform-Based BPO is the best part of the blog, really cloud based services are more efficient than other services used for BPO services. Location-based BPO solution is also appreciable.

  5. Lisa Gray on September 12th, 2012 7:47 am

    Bpo is fast growing service industry in India and has more profit.

  6. Outsourcing Companies on September 12th, 2012 11:24 pm

    Having the intellectual manpower to virtually fill up any outsourcing need, India shall be the foremost player in this regard. Plus Indian companies are doing the right thing — buying right on American soil. Now if only the country can solve it’s electric power infrastructure problems — it’s the only thing that entices more investment.

  7. Savita on September 23rd, 2012 2:21 am

    I second Danie, that this bolg is very informative. But yes must put in a point that, having been in this industry for sometime now; it’s a myth that “Giants” like Genpact and TCS are the only ones that can give innovative and platform based services. Infact i come from a school of thought that there are others “Not so Giant” who are successfully catering to such needs. Giants plug in with their Goodwill/ Capability and hit for premium pricing where as the others serve by cutting their margins with no compramise on the quality.

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