![](grfx/132.jpg) |
Precious resource: Soaring demand and
a lack of supply have made manpower scarce for BPOs |
Imagine
that you are a BPO and have a workforce of 16,000. Also imagine
that, of them, 1,300 quit every month. At Wipro BPO, where 8 per
cent of the workforce turns over every month, the hr team doesn't
have to imagine. Employee attrition is something it needs to deal
with every day, indeed, every hour. Don't feel sorry for Wipro
BPO. It's actually one of the luckier players in the space. At
Satyam Computer Services' BPO arm, Nipuna, the attrition rate
is a terrifying 70 per cent per annum in voice and less than 20
per cent in non-voice; at Infosys BPO (until recently, Progeon)
the "attrition rate on an annualised basis is 41 per cent",
admits the company CEO & MD, Amitabh Chaudhry.
If there is one overwhelming problem that
BPOs in India face, it is of people management. There's both high
attrition and a paucity of talent. In an industry that employs
around five lakh people, attrition runs at a crippling 70 per
cent. "It is not getting business or managing customers;
the single thing I worry about is attracting, retaining and motivating
employees," avers S. Nagarajan, Co-founder & coo, 24/7
Customer, where the attrition rate is 35 per cent.
Don't Blink, or She'll Quit
Last financial year, the ITES sector added
100,000 jobs, but with most companies increasing headcount by
a third every year (in the face of 70 per cent attrition), recruitment
has become the main task of the hr departments at BPO companies.
According to a NASSCOM-McKinsey report, of the 2.3 million people
required by the IT-ITES sector by 2010, India might face a shortfall
of about five lakh workers, primarily in the BPO space. The ITES
sector alone would require a minimum of 1.4 million people by
2010, even by conservative estimates. Moans the chairman of a
large company who did not wish to be named: "All we need
are English-speaking graduates. We train them, pick them up and
drop them, pay them five-figure salaries every month, give them
an air-conditioned work environment and even food to eat at the
company's expense, and all they do is run away every other month."
![](grfx/135.jpg) |
The cost factor: It costs a company
beween Rs 25,000 and Rs 50,000 to train an employee |
Attrition has a huge impact on a BPO's delivery
ability. On an average, a company spends anywhere between Rs 25,000
and Rs 50,000 to train an employee. So, there's a cost implication.
More importantly, service levels fluctuate when there is employee
churn, never mind its impact on employee morale. What really ails
the BPO worker and makes her (it is mostly a her, since six out
of every 10 employees are women) do a hop, skip and jump, every
now and then? Blame it on the nature of work. Most BPO work is
tedious, repetitive, and mind-numbing. Also given the odd working
hours (mostly nightshifts), workers-typically, youngsters in the
age group of 21 to 27-have their social lives and biological clocks
disrupted.
Then, there's a bigger problem. For most
of the BPO workers, the call centre is their first place of employment.
However, after a few months into the job, they get disillusioned
by the nature of work and the apparent lack of growth avenues.
"Nobody works in a BPO thinking that it is a life-long job,
and that is one problem," says Vikram Talwar, CEO and Vice
Chairman, EXL Services. Agrees Vinayak Sanjay Urs, Director, Plakon
Consulting, who points out that, internationally, attrition in
the BPO sector is around 25-30 per cent. "Some people jump
from one call centre to another just to move with a friend or
for a 'change'," says Urs. "Given that demand exceeds
supply, people sometime jump just for the sake of it." Apparently,
the no-poaching arrangement in the industry doesn't work all that
well.
![](grfx/138a.jpg) |
![](grfx/138b.jpg) |
NASSCOM's Karnik: In his opinion, the
industry needs to train its manpower in basic skill sets like
articulation and logical reasoning |
EXL's Talwar: One reason for the high
attrition rate, he
feels, is that nobody works in a BPO thinking that it's a
job for life |
But can workforce-related problems get severe
enough for some companies to shut shop? Yes, they can. In the
last six months, a number of outfits, including Sykes, Apple,
Pervasive Computing, PowerGen and BelAir Communications have shut
their India operations. While some like Pervasive have moved work
to Indian players (Aztec Soft in this case), others have cited
a host of reasons, including cost and people challenges (attracting
and retaining them, as in the case of Apple) for shuttering India
operations. K.P. Balaraj, Managing Director, Sequoia Capital India,
says that companies offshoring should first carefully examine
what processes can be done from afar. Also, scale is a critical
component. In a 30-member operation (which was the size of Apple's
India unit), what is the career growth path and opportunity for
employees, never mind the viability of the unit? asks Balaraj.
"No wonder, in spite of a great brand name, some of them
find it difficult to retain people."
Supply Crunch
Lack of manpower must seem strange in a country
that is home to more than a billion people, and where the unemployment
rate is between 8.1 per cent and 11.7 per cent (for males and
females, respectively, in urban areas) and disguised unemployment
vastly higher. Raman Roy, who was among the first to run a BPO
in the country (he sold his stake in Spectramind to Wipro in 2002),
says the reason why manpower is in short supply is that India
has job seekers who are educated but unemployable. "We have
a short supply of skilled and employable workforce. If India wants
to retain its global leadership in the BPO industry, it will have
to invest heavily in the training of its workforce," he says.
A MATTER OF TRUST
Security of data is a major concern
for customers, and BPOs are going out of their way to address
it. |
Why do some young
BPO workers commit crimes like stealing sensitive customer
information or misusing credit card and bank account details?
Blame it on whatever you will-youth, lifestyle or even lax
security systems. The fact is, with every instance of fraud
that is reported in India (remember the Mphasis and HSBC incidents?),
the anti-offshoring brigade's voice gets a little shriller,
never mind that such frauds happen everywhere else in the
world. "Such incidents cast a long shadow on the BPO
industry, however, we are confident that companies can deal
with these loopholes with a zero-tolerance approach to errant
employees and stringent certifications," says Nasscom
President, Kiran Karnik.
As a result of these incidents, BPOs have gone out of
their way to make their workplace secure. Employees are
frisked, access is controlled, pens and cell phones are
not allowed on work floors. Agents have standing instructions
to blank out work screens when colleagues try to take a
quick look, and bags are searched while entering and leaving
secure facilities. Work stations offer little external access
to associates, since internet access is not available, external
drives can't be connected and even printers are off limits.
To top it all, Nasscom has mooted the development of a registry
of employees so that companies can verify the antecedents
of recruits. Sandeep Dhar, President, Mphasis BPO, points
out that 96 per cent of his 8,100-strong workforce is already
registered with it and the goal is to become 100 per cent
compliant. Needless to say, there will be pressure on others
to follow suit.
|
Kiran Karnik, President of industry lobby
nasscom, agrees and says that this is an issue the industry and
government will have to address immediately. There are certain
'hygiene' skill sets, Karnik says, that prospective employees
lack. These are related to presentation and articulation, logical
reasoning and numeric ability. In a bid to improve the situation,
nasscom has tied up with the National Accreditation Council to
introduce a GRE-like testing system that it expects to roll out
on a pilot basis by the end of the year.
Meanwhile, companies are also trying to tap
into tier-II cities such as Mysore, Mangalore, Vizag, Jaipur,
Mohali, Coimbatore and Kochi. "We needed to look beyond the
metros for prospective employees, but by setting up operations
in tier-II cities, we have been able to tap into a larger pool
of talent," says Sandeep Dhar, President, Mphasis BPO.
![](grfx/140b.jpg) |
Entertainment quotient: Given the monotony
of the job, companies offer diversions to keep the workforce
motivated |
![](grfx/140a.jpg) |
Making Them Stay
Expanding presence geographically is only
part solution to the attrition problem. All said and done, the
big cities are where the best educated and most skilled workforce
is available, and the BPOs have to figure out ways of making employees
stay. Noida-based EXL's Talwar, for instance, says that his BPO
has been able to bring down attrition levels after shifting from
voice-based services to back-office services. (Interestingly enough,
attrition is the highest in voice-based work; in transaction processes,
it is at around 25 per cent and just 10 per cent in the KPO space).
Xansa, a high-end KPO, says that the absence of graveyard shifts
helps minimise employee departures. Companies are taking a number
of other steps to stem the outflow. Ashish Taneja, CEO, Vertex,
says that his Gurgaon-based BPO provides opportunities to employees
for their career advancement and enhancement. "There are
lateral movements within the organisation, and employees are trained/re-trained
on a regular basis," he says. Yoga sessions and dance classes
are also thrown in to energise Vertex's young workforce. Some
others are also focussing on hiring older people and even housewives,
since they tend to be more stable and less prone to job-hopping.
But like nasscom's Karnik says, improving
quality of education and ensuring that more children in India
get educated (and in English) have to be the long-term answers
to the industry's people woes. Until then, churn will be a way
of life for India's BPOs.
|