| iv> | | | | external markets other than just serving their |
| "Its the big fish eating the small fish"- Holds true | | | | own businesses |
| not just in blue waters but also in the global | | | | 4. A shake up is likely, as smaller undifferentiated |
| marketplace of ITeS Industry - Kazim Ali Khan | | | | BPOs will be negatively impacted. Smaller BPOs, |
| Ma Foi India | | | | low-end commoditised services will face the heat |
| I read a book a few months ago called The | | | | 5. Differentiation in service offerings is the *key*, |
| rule of three’, by Jagdish Seth and | | | | viz. moving up the value chain and offering |
| Rajendra Sisodia that examined patterns of | | | | specialised services |
| market evolution in the context of radical | | | | It is also important to note that buyers are |
| disruption that can occur when technology, | | | | shifting focus from cost reduction to cost |
| regulation or a new entry in the marketplace | | | | avoidance, value to value adds, revenue to risk |
| succeeds in altering the rules. In a nutshell, it | | | | sharing, performance to enhanced productivity, |
| described the phenomena where three companies | | | | revenue management to hedging Forex |
| evolving over time dominate any industry. | | | | exposures. In the effort to manage cost and |
| My feeling is that if all such disruptions happen at | | | | mitigate risk exposures, explicit contractual |
| one time, the magnitude of change may swing | | | | contingencies are provided in the service |
| through from companies to impacting economies. | | | | contracts. Risk mitigation factors include not just |
| The current time is such where the global | | | | Forex exposure but also: |
| slowdown, collapse of commodity markets, | | | | 1. Capacity levels, data security, flexibility in |
| geo-political risks, the growth in the iPod culture, | | | | approach of the service providers and not just |
| cloud computing, green technology, sentiments of | | | | meeting SLAs per se |
| US on outsourcing, job losses, etc., are all | | | | 2. Prior direct experience and service |
| happening together, amidst India’s | | | | providers’ ability to expand or consolidate |
| attempts to sustain it’s dominance in the | | | | the supplier base |
| BPO market globally. | | | | 3. Supplier expansion or consolidation |
| It is surely a matter of concern today for us (the | | | | rationalisation, which is being viewed as a means |
| government, industry, professionals and | | | | to gain economies of scale, reduce overall cost |
| institutions) to resurrect policy frameworks | | | | and speedy implementation of new efforts to |
| regarding labour, education, technology and | | | | meet the short-term demands |
| legislation, and create an ecosystem that is best | | | | 4. Buyer behaviour, which is shifting away from |
| suited to sustain India’s leadership position | | | | project—based contract labour to |
| vis-a-vis emerging competing destinations. It is | | | | long-term formalised outsourcing relationships |
| important that India maintains its strategic | | | | Business model transformation is now at a stage |
| advantage in terms of demographics, outsourcing | | | | where the top companies in the world of |
| experience, etc. | | | | outsourcing are talking about a mix of domestic, |
| At the same time, India must also recognise the | | | | nearshore and offshore shared/captives besides |
| shifts taking place that are shaping new paradigms | | | | hybrid models. It is now time to see high-end |
| in the BPO industry. These are: | | | | services getting outsourced to India. Colt, Walt |
| 1. Outsourcing vendors are scouting business in | | | | Disney, MGM, Warner Brothers and many others |
| non-US regions and have a learning curve | | | | across the spectrum are betting big on the Indian |
| 2. IT-BPOs with integrated delivery models | | | | market. |
| offering scale and value will play for the long-term. | | | | I would like to summarise the need by quoting |
| Models of service delivery are evolving as | | | | Donald H McGannon who has famously said: |
| nearshore, home shore, among others | | | | Leadership is action, not position. |
| 3. Captive units are developing business from | | | | |