Building an Agile Enterprise

A cursory look at the entire outsourcing wave shows how outsourcers have prioritized knowledge and cost savings, and shelved cultural differences. As a result, predominantly western-centric companies, despite the cultural divide, have adapted themselves to Indian dynamics, and that had led the outsourcing industry to boom. In the outsourcing world, BPO is the hottest segment. Unlike its big brother, IT, the dynamics of the BPO industry is totally different. If we look at the two dominant forms of BPO-voice and transaction-companies have come a long way.

India is going to play a significant role in the export of services. Therefore, it is imperative to understand world trade which is critical to business. The total number of IT and ITes - BPO professionals employed in India is estimated to have grown from 2, 84, 00 in 1999-2000 to 1,287,000 in 2005-06. In addition, Indian IT-ITes is estimated to have helped create an additional 3 million job opportunities through indirect employment. In order to stay in lead and increase India's share in the global market, the Indian government and IT/BPO industry need to focus on moving up the value chain by cultivating deep and enduring innovation across three dimensions –

a) Business model innovation
b) Knowledge innovation; and
c) Ecosystem innovation.

The IT sector has to expand to other countries and tap new centers of emerging demand and expand not only in terms of quantity but also in terms of quality of its skilled labour by introducing appropriate changes in the system in collaboration with the industry and academia. This calls for a transformation of Business Process Outsourcing to Knowledge Process Outsourcing (KPO) units.

Despite the boom the industry is eyeing, challenges are very pronounced because BPO is a customer facing industry. On any given day, thousands of BPO employees interact with clients and customers. If we look a little closer at BPO as an enterprise, it faces numerous challenges. And to surmount these challenges, BPO companies need a high degree of top management commitment. Agility comes with the seamless interplay of key components that create an eco-system on which the enterprise runs. If we look at the challenges faced by BPO companies, we can narrow them down to three core challenges-managing the telecom, the IT infrastructure, and HR. If these three components are taken care of, most of the other challenges can be managed easily.

Technology: Challenges and Solutions The BPO industry is all the while concentrating too much on managing the manpower churn . But correct technology deployments and implementing IT best practices go a long way in upping the operating efficiencies. BPOs, in addition to deploying enterprise applications, give high emphasis to networks as real-time remote communication is the order of the day for most BPOs.

Managing a private network with diverse network connectivity, PoP is a big challenge for maintaining high uptime; creating a network up-time backbone that secures the much sought after five-nine (99.999%) up-time is indeed a challenge and the key goal of BPO companies. This network backbone is the one that makes the entire mission critical processes in the BPO to function on a 24/7 basis. The challenge in networking is to make sure you have available capacity at all times to enable 24x7 operations. Having realized the criticality of uptime, BPO companies are also gearing up to meet the stringent operational requirements. To manage the networking challenges it is wise to use services of multiple vendors. This method enables enterprises not to get tied with one vendor. The multi-vendor approach gives flexibility and heterogeneity in terms of managing out networks effectively.

From an application side of things, one key technology area which is directly related to operational efficiency is First Call Resolution (FCR) measurements. The time spent by the agent on every call is measured in what is called as Average Call Handling Time (ACHT). The more the agent spends on each call, is an indication that the problem has not been resolved. When the same customers need to call again, it means that the problem is not sorted out.

The biggest challenge for BPO companies is to deploy FCR solutions that help the agent as well as help measure how much of FCR they were able to achieve in any given day vis-à-vis the number of customer calls. Hence, a good FCR solution is a must to benchmark the call center performance on the way the calls are handled and problems resolved.

From an organizational viewpoint, given the huge manpower of most of the big BPO companies, a robust HR automation solution is mandatory. The creation of an HR portal also assumes significance. The biggest challenge here is in creating a single window intranet, where right from employee appraisals to the latest happenings should be available. The creation of a fully automated HR system involves careful planning and right selection of HR solutions, supported by proactive HR policies.

The HR Churn: Beyond technology HR is a key challenge that most BPO companies face. Retaining talent is the primary challenge that BPO companies face. Since the nature of work in most BPO companies is often routine and repetitive, attrition tends to peak. According to industry experts, the BPO industry, in a short time span, has gained importance due to its phenomenal growth. Industry bodies had predicted that the 650,000 people currently employed in IT and BPO will triple in the next five years and grow over to 2 mn. Given this backdrop, HR professionals today face a whole lot of challenges. While there is a large number of qualified manpower available in the market, the actual percentage of people who are employable in the BPO sector is only about 5%.

Being a very young industry, and the low employability percentage, the need for domain experts is a big need. In today's scenario, the business processes that companies handle are very mature, but the employees are very young and, in most cases, with high attrition, the entry level employees do not fully understand the mission critical nature of the work they do. As there is a wide supply-demand gap, retaining talent becomes another big challenge for companies, especially in this growth boom. This also leads to poaching of employees between companies; with the frequent job hopping leading to scarcity of talent. With attrition and skill shortage on the anvil, the BPO companies are implementing various ways and means to retain and attract new talent.

What emerges at the end of the day is that as BPO companies scale in size, they need to expand all the vital components–from technology infrastructure to employee benefits. On the technology side, BPO companies need to think innovatively and go for concepts like virtualization for greater manageability. Managing networks will continue to be a challenge as technology heads will face increasing pressure in building a robust network. End-point security will also become a big issue and one needs a slew of security solutions from firewalls to anti-spam. On the HR side, while attrition will increase, BPO companies must focus on creating domain leaders within their own companies so that a highly skilled HR base can be created.