Meritocracy: Candidates brainstorm at a group discussion moderated by a MeritTrac assessor

If * stands for +, / stands for *, + stands for - and - stands for /, then what is 6/9*9+13-2?" Huh? What was that again? I just don't believe it. Here I am, sitting in front of a computer and getting all sweaty because I am taking an online test meant for BPO and it industry aspirants. But why should a hack like me have to go around letting devilish numbers turn my brain into a quivering jelly, you ask. Good question-and one that I asked my editor when he first proposed it. Perhaps he was trying to tell me something none-too-subtly, but at that time he made it sound all exciting and adventurous. And it was, but more about that later (see BPO, Here I Come).

So, once again, why was I here, at MeritTrac's cubby office in Bangalore, taking an online test? To see for myself just how it and it-enabled services providers like Infosys and Wipro are now beginning to recruit their army of workers. MeritTrac, you see, is a four-year-old company that pre-screens applicants and finds out if it is worth the company's while to spend talking to the candidates. And the way MeritTrac does it is by administering a test that is custom-made to the job. Yet, each test is different (so don't waste your time trying to solve the question above if you have a resume in the mail for Infosys or Wipro) because it automatically adjusts to the skill levels of the candidate (like the GMAT). Says Madan Padaki, Director, MeritTrac: "We design the test format in consultation with the company, we hire the premises where the tests are to be conducted, we administer the tests, and finally assess the candidates." In other words, MeritTrac offers outsourced assessment.

Why would an industry where people are its only assets farm out the task of their assessment to a third party? Simply because the industry is a glutton when it comes to recruitment. Consider the numbers: In the July-September quarter alone, Infosys hired 5,000 people, most of them at the entry level. If that doesn't sound impressive enough, consider that it gets a million applications every year and of them, hires 10,000-odd. Wipro, another it giant based in Bangalore, took in 3,300 people for its services arm, and will probably recruit more depending on its growth and attrition rates.

Team MeritTrac: (From left) Co-founder Muralidhar S., Founder and Director Madan Padaki and Mohan Kannegal, Director (Technology and Content)

Getting the in-house hr department to do it would not just add to headcount and bloat costs, but entail a disproportionate demand on management time. Besides, recruitment these days is done from all over the country-especially in the BPO industry. If you are a 500-seat back office and want to hire 1,000 people (to work in two shifts), then your catchment area will necessarily need to extend beyond your own city. And given that the average hit rate is a meagre 8 to 9 per cent (meaning, of every 100 people interviewed, only eight or nine are found suitable), hiring 500 agents would involve screening some 5,000 applicants across half-a-dozen cities. Says A.K. Sreekanth, Director (hr), Computer Associates (India), a MeritTrac client: "With increasing complexity of the hr function, there are new challenges that an hr department alone cannot address. We need service providers who can add value and yet be cost-effective."

MeritTrac, then, was set up by Padaki (he worked with Infosys, Wipro and BFL Software before that) and S. Muralidhar, who had earlier worked with L&T, Asian Paints and Birla 3M, to cater to this need. Over the last four years, the company-which counts hp, Accenture, Adobe, IBM and Dell among its other clients-has assessed more than 4.5 lakh candidates, although these days it tests a staggering 25,000 applicants a month. How much does MeritTrac charge for its services? Between Rs 100 and Rs 200 for each BPO aspirant and from Rs 250 to Rs 1,000 for it industry wannabes.

At any given time, MeritTrac has more than 25,000 questions in its bank. Most of the questions are developed by freelance experts. However, the tests can be tailored to assess whatever skills the client thinks are more important for a job. For example, if a company needs 75 j2ee programmers for a particular project, MeritTrac can put together a test that evaluates the applicant's knowledge of the subject. "In several cases, we act as an extended hr arm of our client companies for processing pre-recruitment processes," says Padaki. The tests are available both online and offline, and some 1,500 candidates can be administered the online test simultaneously.

MeritTrac is thinking big. It wants to get its evaluation system recognised industry-wide-just like the Common Admission Test (cat) is the evaluating standard for most business schools. While that may be some way off, there are enough people who think MeritTrac is on, well, the right track. Says Madan Nagaldinne, Vice President (hr), Tavant Techonologies: "The initial success of hr outsourcing belonged to integrated service providers. My feeling is that niche service providers like MeritTrac will be the ones who ride the next wave."

I, of course, will be keeping an eye on MeritTrac for you, dear reader. But I don't think I will be writing a story on them again anytime soon-certainly not if that means my having to take another test.

MANAGING THE MONEY MACHINE
Ever wondered how the ATM in Leh or a remote village in Punjab stays in cash round the year? It's courtesy a new breed of service providers. Meet the new "money managers".

By Roshni Jayakar

Eyes peeled: Rajiv Singh, Managing Director of Diebold Systems at his Remote Monitoring Centre in Mumbai

Except that it announces the company's name at the entrance of the building, Diebold Systems' managed services centre in Andheri, Mumbai, could pass for a super-secretive government skunkworks. The 4,200-sq.ft. floor is packed with 12 desktop PCs with an equal number of people sitting in front of them. One of them, Namrata Sheth, is staring at her pc that is cluttered with a hundred-odd icons in red, yellow, blue and green. At the moment, there's no sign of worry on the 24-year-old's brow, because the 100 or so automated teller machines (ATMs), represented by the colourful icons on her screen, are functioning smoothly. And at 3 pm on a late November evening, all's well at the office of the one-year-old remote manager of ATMs. Outside, ATM users-they clock about 150 transactions a day for each of the 6,000 ATMs that Diebold manages-are rhythmically harvesting the fodder they need to make the mare go round.

Welcome to the world of outsourced (and remote) ATM management. With ATMs becoming a crucial part of every bank's retail strategy, their population has exploded. At the moment, there are an estimated 16,000 ATMs in the country, covering Leh to Kanyakumari on one side and Kutch to Itanagar on the other. In another five years, there could be as many as 85,000 ATMs all over India if they were to grow at 40 per cent per annum. ICICI Bank and the State Bank of India have the largest networks, accounting for a whopping 6,000-plus ATMs each. Maintaining and monitoring each and every one of the ATMs is no joke. Not only do they need frequent replenishment of cash, but each and every transaction needs to be recorded and linked to the customer's account with the main branch; troubleshooting needs to be provided on an online and real-time basis, besides which the ATM must be kept secure.

No wonder, then, an increasing number of banks (ICICI Bank is a striking exception) outsource the whole or part of the ATM management to a new breed of service providers like Diebold or NCR or Euronet, who, sensing an opportunity, have gone beyond mere selling of these machines. Says Rajiv Singh, Managing Director of Diebold, whose American parent is a $2.1-billion (Rs 9,450 crore) giant in the "self-service delivery systems and services" business: "Like we say worldwide, our business is to make our customers' customers happy. In the case of ATMs, we ensure a service environment where outages can be avoided." Diebold boasts of customers such as Jammu and Kashmir Bank and Punjab National Bank.

Remote Eye

How does remote ATM management work? Let's go back to Diebold's Andheri office and take a look at how it's done. Remember the icons on Sheth's monitor? Well, each of those represents an ATM. A green icon with a smiley means all's well. The yellow icons point to a non-critical issue such as the store of currency notes or paper roll reaching the first threshold of exhaustion. Blue icons are alerts to a potential outage, while the red ones mean the ATM is down for whatever reason (the Diebold operator would know exactly why).

Tech power: An operator working at one of Diebold's remote monitoring machines

Sheth, who manages about 500 of Diebold's 6000 ATMs, does not react to the icons because the system is built to take care of most of the problems. How? The ATM, which is connected to an ATM switch at the bank (see How Does It Work?) and that, in turn, to Diebold's service centre, analyses the situation, determines what action needs to be taken and automatically notifies the concerned bank manager (if the vendor only offers network management) or the service provider (where ATM management is completely outsourced). Where the latter is the case, somebody like Sheth can click on the appropriate icon and access information such as the ATM's location and the manager responsible. Typically, even where the ATM has self-reported a fault, the Diebold operator would call up the bank to inform.

Sometimes, what may look like a routine fault could actually be a disaster in the making. Consider what happened at Diebold's centre three weeks ago. Working on the third shift, Jacinta Ma, one of the operators, got an alert on her monitor about an ATM's chest door being open. It was midnight and, therefore, it couldn't be a case of cash replenishment in progress. Was the chest door left open accidentally or was somebody actually trying to steal money from the ATM (it was located on the outskirts of Delhi)? Ma called up the concerned bank manager, who moved in time to prevent a heist.

But that's an adventurous exception by the standards of ATM management. Mostly, the work includes round-the-clock monitoring of the machines to track their performance and address problems. It also includes predicting ATM service or cash and consumables replenishment needs, tracking the performance of a vendor (physical) service team, offering electronic journal (or transaction history) upload service, and technical troubleshooting. Pedestrian as the work may sound, there's a tidy sum to be made-an estimated Rs 75,000 per ATM per month. Cost savings to the bank vary from 10 to 25 per cent depending on the number of ATMs outsourced and the service opted for. Says Deepak Chandani, MD, NCR, another hardware and service provider that does work for the SBI and the Corporation Bank and which recently opened a 250-seat centre in Powai, Mumbai: "It's a major area of opportunity as the suite of products provides a win-win situation for the banks."

There are other benefits that accrue to their bottomline. For instance, the technology provided by the vendors in terms of cash management services allows banks to accurately predict consumption at each of the ATMs and, therefore, better manage cash inventory. And since cash-carrying cost is one of the biggest costs of running an ATM, the estimated 30 to 35 per cent savings that currency management tools afford matter a lot. But as Khursheed Muzaffar, CTO of the Jammu and Kashmir Bank, puts it: "It's not cost savings or the number of ATMs, but the reliability of the ATM that provides our customers and, in turn, us the value." He could well be speaking for the new "money managers".