����

�

CHAPTER III

BUSINESS PROCESS OUTSOURCING

“It is not the strongest among the species that survive,

Nor is it the most intelligent,

It’s those that are most adaptive to change.”

- Charles Darwin

"Survival of the fittest" is the most important concept in the business world today. With the

advent of globalization, there is fierce competition between organizations in several areas. In

order to survive the organizations have diversified their operations in a big way. To meet the

challenge of competition, leading companies worldwide are focusing their resources on their

core competences and assign some of their non-core activities to outside players. This process is

called as "Outsourcing”.

Outsourcing enabled several companies easily adapt change and emerge victorious. It helped

them reduce costs. Improve their focus, make better use of the available resources, increase

efficiency, reduce time to market and enjoy offshore benefits.

The word “Business Process Outsourcing” (BPO) means sourcing from outside. It is the practice

of hiring a company to handle business activities for the other company as a third party. In this

method of outsourcing the third party gets a contract to perform specific and specialized

functions on behalf of the hiring company.

In a world where IT has become the backbone of business worldwide, “Outsourcing” is the

process through which one company hands over part of its work to another company, making it

responsible for the design and implementation of the business process under strict guidelines,

regarding requirements and specifications from the outsourcing company. This process is

beneficial to both the outsourcing company and service provider, as it enables the outsourcer to

reduce costs and increase quality in non-core areas of the business and utilize their expertise and

competencies to the maximum (Gary Hamel and CK Prahalad1, 2002).

����

�

3.1 DEFINITIONS – OUTSOURCING

Business Process Outsourcing (BPO) means delegating the ownership, administration and

operation of a process to a third party. BPO is about solving a business problem. BPO aims to

raise a client company's shareholder value because it is about delivering outcomes -that is,

higher- performing business processes.

Outsourcing has been defined by several professionals. Some of the definitions are:

Business Process Outsourcing is defined as "Business Process Outsourcing (BPO) is the process

by which the business process for company is done through any other organization, globally. The

attraction of outsourcing is cost reduction, by S. Johnsi and N. Nirmala Devi2 (2004).

Business Process Outsourcing (BPO) is defined as "a contractual service to completely manage,

deliver and operate one or more (typically IT-intensive) business process or functions", by K.

Kavitha and S. Jaishri (2004).

Another definition for BPO is "Business Process Outsourcing (BPO) which means delegating the

ownership, administration and operation of a process to a third party" given by H. Kavitha,

Susan Abraham and R. Nirmala3 (2004).

P. Sivakami and P. Palanivelu (2004) mentioned in their article that John Bransley says

"Business Process Outsourcing is becoming the new business model for managing corporate

change and growth."

Mark J. Power says "Outsourcing is the act of transferring some or all of an organization's

recurring internal activities and decision rights to outside providers whether domestic, near shore

or offshore as set forth in a contract."

Outsourcing is defined as "Outsourcing takes place when an organization transfers the ownership

of a business process to a supplier" by S. Renuka Devi and C. Radha Priya (2004).

David J. Bloomberg, Stephen Lemay and Joe B. Hanna defined Outsourcing as "Outsourcing is

simply defined as buying a product or service from outside the organization, rather than

producing or providing it within the organization. The term Outsourcing is often used to describe

the process of seeking goods and services from the outside."

����

�

3.2 HISTORY

There is a school of thought which feels that outsourcing has existed since the stone ages when

manufacture of certain weapons was outsourced. The manufacturing industries which existed in

the nineteenth century and early part of the twentieth century quite often manufactured

everything that went into a product. Outsourcing has grown to different levels from the time-

sharing data process model to business process outsourcing (BPO) and then to knowledge

process outsourcing (KPO). Recently, companies follow the business strategy of outsourcing

entire business activities, such as technology operations, customer relationship, logistics, finance

and document processing.

The history of outsourcing dates back to the 1960s, started in the United States, when it was

struck with economic stagnation and rising inflation rates. This forced Federal Reserve to

increase the interest rate to around 20 percent to control the inflation. It reacted well in

controlling the price but it has increased the dollar value and attracted heavy investments in US

government bonds. But the US industries faced problems. The costs of industrial production

went up and many industries were closed down due to heavy loses, so that the US economy

faced heavy job loss. This became a huge cost advantage to the industries in other countries.

American car companies started closing their factories in the US and started their operations in

Mexico during the 1970s. Auto industry jobs from the US were continuously outsourced to

reduce cost. Capital industries outsourced their service related jobs to other locations to regain

their profitability. Since, then US companies started outsourcing to cheaper locations.

This trend continued in the US, and later in the 1990s the process of outsourcing accelerated.

After the North American Free Trade Agreement (NAFTA) among the united states, Mexico and

Canada, American firms started looking towards Mexico and Canada markets for export and new

factory locations. More industrial plants were started along the Canadian border as the low cost

wage there proved to be a significant advantage over America. Canada was best suited to low

cost labor with good English speaking people, whose culture was similar to the American

culture.

Automakers in America received benefits of cost reduction in the manufacturing of their supply

parts with their low labor and overhead rates through outsourcing to Canada and Mexico. Canada

����

�

has a greater export advantage as they had exported 11 percent of their parts manufacturing only

to United States in the first eleven months of 2002. Not only is their production of auto parts

outsourced, but also back office services have started moving to other cheap cost locations in

Europe and Asia. For the back office services, Asian locations have proved to be profitable with

quality services at cheaper cost. High end jobs like research and development, product

innovations, and design outsourcing have started moving to other locations mainly in Asia.

In the 1970s and the 1980s, the Japanese and American firms Toshiba, Motorola and Texas

Instruments moved their production facilities to the low cost locations of Taiwan and Singapore.

In the early years, only the manufacturing activities were being outsourced to the low cost

locations but, in the 1990s, liberalization and globalization of the world economy brought the

various markets in the world closer. Later, US companies started outsourcing information

technology (IT) activities to low cost locations in India. Some of the companies have also started

their offshore facilities in India and Philippines, most importantly, manufacturing companies

outsource research and designing activities also to low cost locations.

After the flourishing of information technology (IT) in the late 1990s and 2000s, outsourcing has

spread to all the IT nations. The internet business boom is the main drive for this success.

Especially two Asians giants China and India are the leaders in providing outsourcing services to

the American Industries. China has proved handy with low cost labor for the original equipment

manufacturers (OEM) in Europe and America. Later, it became the market leader in information

technology outsourcing to the US industries. The boom in information outsourcing happened

only after the globalization of the economy. The financial outsourcing and business modeling

was done on a large scale only after the economic boom. Mainly top US and European

investments banks have opened their offshore outsourcing facilities in low cost locations like

Ireland, Philippines, China, India, Mexico, Australia, and Singapore. India and China lead the

market with the opening of their economy to the world.

According to Gartner Inc, outsourcing has got more revenue opportunities for the developing

countries. Foresters’ research estimates that by 2015, 3.3 million US jobs and $136 billion worth

wages will be moved to countries like India, China, Russia, Pakistan, Vietnam and South Africa.

In the Last Ten years, developing countries have attracted more foreign investment and revenues

mainly due to outsourcing (www.golbalenvision.org).

����

�

The industry is estimated to aggregate revenues of USD 73.1 billion in FY2010, with the IT

software and services industry accounting for USD 63.7 billion of revenues. During this period,

direct employment is expected to reach nearly 2.3 million, an addition of 90,000 employees,

while indirect job creation is estimated at 8.2 million. As a proportion of national GDP, the

sector revenues have grown from 1.2 per cent in FY1998 to an estimated 6.1 per cent in FY2010.

Its share of total Indian exports (merchandise plus services) increased from less than 4 per cent in

FY1998 to almost 26 per cent in FY2010.

Export revenues are estimated to gross USD 50.1 billion in FY2010, growing by 5.4 per cent

over FY2009, and contributing 69 per cent of the total IT-BPO revenues. Software and services

exports (including BPO) are expected to account for over 99 per cent of total exports, employing

around 1.8 million employees. The IT Services segment aggregated export revenues of USD 27.3

billion, accounting for 55 per cent of total exports.

Domestic IT-BPO revenues are expected to grow at almost 8.5 per cent to reach INR 1,088

billion in FY2010. Domestic IT services is expected to grow by 12 per cent in FY2010. While

hardware spend is largely expected to remain fl at in FY2010, an imminent hardware refresh

cycle will positively impact revenues next year. The domestic BPO segment has continued its

strong performances over the past few years, growing by 22 per cent over FY2009, to reach INR

108 billion, driven by large deals in the telecom and BFSI space.

Availability of skilled talent has been India’s foremost attraction as a global sourcing country.

India’s graduate outturn has more than doubled in the past decade, with addition of 3.7 million

graduates in FY2010, a scale unmatched by any other country. While some gaps in talent

suitability exist, they are being addressed through strong provider-level initiatives and industry-

led programmes.

The beginning of the new decade heralds the slow, but steady end of the worst recession in the

past 60 years. Global GDP, after declining by 1.1 per cent in 2009, is expected to increase by 3.1

per cent in 2010, and 4.2 per cent in 2011, with developing economies growing thrice as fast as

the developed economies. Improving economic conditions signifying return of consumer

confidence and renewal of business growth, is expected to drive IT spending going forward. IT

services is expected to grow by 2.4 per cent in 2010, and 4.2 per cent in 2011 as companies

����

�

coming out of recession harness the need for information technology to create competitive

advantage.

Development of these new opportunities can triple the current addressable market, and can lead

to Indian IT-BPO revenues of USD 225 billion by 2020. The industry also has the potential to

transform India by harnessing technology for inclusive growth.

Even though growth in BPO was single digit for the first time, it still is the fastest growing

segment of the industry and is estimated to reach USD 12.4 billion in FY2010, growing at 6 per

cent. Increased acceptance of platform BPO solutions was the key highlight, as Indian BPO

providers increasingly focused on transforming client businesses through a mix of re-engineering

skills, technology enablement, and new service delivery methods. Additionally, the engineering

design and products development segments that involve IP driven service capabilities command

an exports revenue share of 20 per cent, generating total revenues of USD 10 billion in FY2010,

growing by 4.2 per cent.

Growing at an extremely high pace, the industry has demonstrated a decade of strong growth –

growing 15 times to aggregate revenues of USD 69.4 billion in FY2009. In addition, as one of

the largest employers in the organised private sector, it provides direct livelihood to 2.2 million

people.

Volume-wise, BPOs are already showing great promise to transform India economically, much

in the way oil has transformed the economies of the Gulf countries. Forrester research predicts

that 3.3 million US jobs to move offshore by 2015. As per Nasscom, assuming the projections

are correct, and, in the year 2010, the BPO industry directly supports the livelihood of about 1-

1.5% of India’s population. Another 0.5% of the Population will be supported by the ancillary

effect of BPO. Thus, at best, 2% of India’s population will be affected by the BPO industry. In

sheer GDP terms, India’s GDP is about US$600 bn in 2010. 4% of the GDP is contributed by

BPOs. These numbers show sufficient promise to spark the “prosperity chain”, wherein, the

capital generated through this industry is invested back in other industries not only domestically

but also globally to generate a virtuous cycle of investments and profits.

����

�

3.3 CONCEPT OF OUTSOURCING

Organizational processes can be made to offer higher effectiveness through capacity

augmentation, process improvement and outsourcing. What should be recognized is that capacity

augmentation and process improvement methods need not be confined within the organization

but may be extended beyond. This recognition is the cornerstone for the concept of outsourcing.

R. Parameswaran and K. Jyothi (2004) mentioned that BPO is a business discipline built on a

long-term commercial relationship between a process supplier and a process consumer that is

enabled by a process infrastructure and maintained at a high level of mutual commitment and

collaboration.

Fig.3.1: Outsourcing-Internal Forces & External Forces

Key Factors of Outsourcing

The concept of Outsourcing is used in many organizations for various reasons. The following are

the key factors that will determine whether a company should actually go for outsourcing:

• To market the size

• Rate of market growth for the firm

�� ����� ����

������ ������������ ���� � � � � !"�#�"���� ������� �

�

�

�

�

�

�

�

��$������� �� � � %���&�"���� � � � '�������������(����������

%�) ��*� &�

+ �) "�(&��, � �&�� � ��

%�� &�� ����

, ��&���-.�� ��

/ ��0�"���� � � � 1� ������

2 �� ����� ����

, ���������� � � ��(����� ��3�#� �3����

� ����� ��

����������

��4�

�

• Complexity in manufacturing its products

• Introduction of new products based on technologies

• The emergence of competent supply sources; and

• The willingness of the company to adopt new practices

Reasons for Outsourcing

In this era of globalization, many companies settle for BPOs to reap the benefits of outsourcing

and develop standard product/process that can withstand the international competition.

Organizations undertake outsourcing to reduce cost of infrastructure, operations, production etc.,

and also to reduce manpower, inventory levels. Outsourcing helps in improving the quality of

product, customer satisfaction, and better interaction with the customer and in increasing market

share. This also helps to concentrate on R&D, develop technical expertise, transfer of technology

etc.

3.4 TYPES OF OUTSOURCING

The main types of outsourcing generally practiced by business firms are:

a) Contracting out the activities: This is generally used as a tactical solution to a problem rather

than as a part of the firm's strategy for growth.

b) Outsourcing the service: This decision is meant to be a strategic initiative to make use of an

efficient service provider's expertise in handling a particular operation

c) In-sourcing: This is a unique outsourcing phenomenon. A firm taking this route of

reorganization of business strengthens and modernizes an important activity which it

considers improper to outsource. It makes the activity economically more viable by

providing this service to other businesses for a revenue consideration after its own interests

are satisfactorily attended to.

d) Co-sourcing: The host organization provides the staff or managers to the outsourcing deal in

order to make use of their expertise and to retain them. Thus, in such a deal, both the

suppliers and host have the onus to supply the human resources for the success of the

outsourced task.

��5�

�

e) Benefit-based relationship: Both parties have long-term agreement for the outsourced task.

According to this agreement both the parties share the investments to be made for the

outsourced task and agree to share the benefits from its successful implementation.

The above types of outsourcing of services can be classified into two types, namely, technology

outsourcing and business process outsourcing. Technology Services include e-Commerce,

Networks, and Software Applications, Telecommunications Website Development and Hosting.

Business Process Outsourcing includes Customer Contact, Equipment Finance, Accounting,

Human Resources, Logistics Procurement, Supply Chain Management and Security.

3.5 MODELS FOR OUTSOURCING

"Outsourcing is becoming the new business model for managing corporate change and growth"

says John Barnsley, Global Leader of the firm's worldwide BPO practice.

"It enables companies to shatter the boundaries of their traditional businesses and to build long-

term strategic partnerships with outside professional service firms for managing in the new

millennium".

There are three ways in which companies are outsourcing their operations. They are:

a) Onsite Model for Outsourcing

The success of any outsourcing contract lies in the appropriate and precise gathering of

information about the project. According to the onsite outsourcing model, the whole set of

processes starting from information gathering, to implementation, is done at the client's premises.

This model ensures that the result is correct at the first instance. Based on the needs and

requirements of the client, the design, development and test teams are deployed for a shorter time

frame at the client's location. This model becomes essential and suitable if the project needs a

specific resource type of post-development, maintenance, support and follow-up activities. This

model is helpful for those projects that are mission-critical, require proper and constant attention

and also need everything to be done in the client's location. Thus, the onsite outsourcing

approach is ideal for:

��6�

�

• Requirements not being defined at length

• Dynamic changes in deliverables or requirements

• Tough and Rigid deadlines

• Constant need of support

• Direct interaction with client

• Scalable staff augmentation

• Moving across time lines

• Mission Critical Projects

• Product engineering-related services

• Open-ended literative nature of project scope

• Projects that are highly secured and confidential

In this approach, all the activities mentioned below are executed onsite:

• Initial Study/Understanding the client's requirements

• Planning

• Technology Assessment

• Development

• Design

• Testing

• Installation

• Maintenance and Support

b) Offsite Model of Outsourcing

According to this model of outsourcing, the service provider will have its office near the client

location. Not only does the outsourcing offsite centre have the benefit of being close to the client,

but it also gives support to the onsite team and the offshore development activities at the offshore

centre. Thus, the experts at the outsourcing offsite centre in tandem with the corresponding

offshore centre team ensure on time, quality service through collaborative skills across different

time zones. This model is appropriate:

����

�

• For short-term outsourcing projects

• When requirements are defined beforehand

• When there are no frequent changes in the outsourcing project

• When the client's location may not have extra capacity

c) Offshore Model of Outsourcing

This model of outsourcing entails that the project-related activity; right from initial study to

testing is done at the service provider's premises. The outsourcing service provider will not

have any presence at the client's location but the client will interact directly with the offshore

team. This model is best suited when the project plan is well defined and the development team

has a clear understanding of client requirements. The team members at the outsourcing offshore

location interact with the client through various communications means such as telephone, fax,

e-mail, etc. this model has proved to be effective in terms of:

• High quality service with low labor cost

• Effective utilization of time zone (24x7 service)

• Availability of multi-technology skills

• 30 to 50 percent reduction in project cost.

The effect of Globalization has brought a great change in the business process worldwide. The

companies have obtained a new business sculpt called ‘outsourcing’. This new phenomenon

spurs up the business processes, eradicating the costs for administration and improving

competency.

Outsourcing has become a term widely used in the last ten years. “Outsourcing” involves

transferring or sharing management control or decision – making of a business function to an

outside supplier, which involves a degree or two-way information exchange, coordination and

trust between the outsourcer and its client. Such a relationship between economic entities is

qualitatively different from traditional relationships between buyer and seller of services. The

involved economic entities in an “outsourcing” relationship dynamically integrate and share

management control of the labor process rather than enter in contracting relationships where both

entitles remain separate in the coordination of the production of goods and services”

(www,sudhian.com).

����

�

Companies generally make use of BPO taking into consideration the cost and lack of expertise

which are to deal with certain parts of business. Western companies mainly the companies of

United States have found India as one of the best service providers at an outstanding price. This

is because of well educated team of human resources, soaring rates of unemployment and a low

standard of living. By outsourcing the functions of customer service to the countries like India

the companies save a lot of money and their bottom line gets improved, Though BPO has

become quite lucrative, customers and employees are of the repercussion that taxation and

certain restrictions on the practice of outsourcing may shrink its esteem.

It is also an industry where change looks like the only constant. Much in the way of the core IT

industry where the change in technology, systems programming languages, platforms,

hardware/software, etc., has already been accepted as a way of life for the products as well as the

people involved. The BPO industry is also witnessing a continuous change in terms of the client

requirements domains in which BPO solutions/services are offered, value propositions and

delivery models.

The outsourcing industry has also moved into high jobs of knowledge process outsourcing

(KPO). India is considered to be a dominant player in Outsourcing along with the Philippines,

Canada, Australia, China and Ireland. India has the huge advantage of a large pool of skilled

human resources with good education, suited to the US Clients business needs. Spanish speaking

countries like Mexico, Brazil and Spain are the dominant players in BPO. Other developing

countries entering the BPO industry are Srilanka, Pakistan, Malaysia, South Africa and Kenya.

As other developed countries, move towards high end outsourcing services, new entrants are

building their space through low end outsourcing jobs.

Availability of skilled, English – speaking population in abundance at lower costs, have made the

Asian countries, a preferred destination for outsourcing. The Asian contract manufacturers and

independent design houses have already grown to be major providers of several tech devices like

TVs, Laptops, MP3 players and digital cameras. Nearly 70% of personal Digital Assistants

(PDAs), 65% of MP3 players and 30% of digital cameras, are produced by Asian ODMs

(www.businessweek.com). Asian Countries like India and China have become the major

beneficiaries of tech employment and these countries are increasingly graduating to become the

chief suppliers of intellectual property.

����

�

Doug Rasor, Strategic marketing manager. Texas Instruments Inc. said “There is a lot of great

capability that has grown in Asia to develop complete products. They can do the system

integration, the plastics, the industrial design, and the low – cost manufacturing and they are

happy to put Dell’s name on it. That is a mega trend in the industry” Due to the changed mindset

of companies from ‘not invented here to let’s find the best ideas wherever they are, R&D, which

was once considered a core competency to a company (mostly conducted in – house), is

increasingly moving ‘outward’.

Companies like Procter & Gamble, General Electric, Johnson and Motorola are transforming

their culture and reshaping their business models to divert their focus from quality and costs to

‘high – impact innovation’ targeting customers in need of custom-made products and services.

According to Business week, “The goal is to create special, differentiated experiences using

proprietary brands. Such out of the box innovation may be the best path to top line revenue

growth and fat profit margins”.

Emerging Outsourcing Designations

In 2005, India was an IT Outsourcing powerhouse, with $17.7 billion revenue in software and IT

service exports, compared to $3.6 billion in china and $1 billion in Russia

(www.businessweek.com). India’s outsourcing industry was growing at a faster pace than that of

Russia and other outsourcing centers. But as labor costs and turnover rates began rising in India,

companies started looking out for cheap labor. As a result, many new outsourcing destinations

emerged and started growing at a fast pace. The ever increasing labor cost in India resulted in the

emergence of many new destinations for outsourcing. “Ninety percent of all outsourcing deals in

the market today have been structured around cost improvement only”

(www.businessweek.com.) opined Linda Cohen, Vice – President, Gartner.

Many Companies including Accenture, EDS, IBM Global Services, and Genpact had invested in

building global networks, comprising operations in various cities aimed at giving customers a

mix of worker skills and labor costs. “Today we are about 35% in high – cost locations, such as

the US and Britain; 20% in medium – cost locations like Spain, Ireland, and Canada; and Eastern

Europe” (http://www.businessweek.com). Said Jimmy Harris, global managing Director,

Accenture. It remained to be seen whether India could maintain the competitive advantage over

����

�

others in the field of business outsourcing.

In this recent era, business process outsourcing is ruling the global marketplace by both the

multinationals and service providers. Outsourcing destinations have been classified into three

groups. The classifications have been done on the stricture; like total size of the industry, average

cost of employees, availability and enormity of human resources, quantity of quality

certifications received, chief clients and other contemplations.

The Prime destinations:

The most ideal destinations for outsourcing are India, Ireland, Israel, Canada, Philippines and

South Africa.

India has become one of the most attractive spots for any global Company for outsourcing their

business processes. She has incarcerated in her grip the lion share of the offshore market and has

taken an important lead in the queue as the most preferential outsourcing destinations across the

globe. Several reasons have made India so popular worldwide. If the cost factor is considered

first, it is found that India holds first position globally in terms of employee cost, infrastructure

cost, management cost and the tax structure. Secondly, India is blessed with the asset of

educated, competent, skillful and English speaking human resources. Thirdly, the environment of

India is quite conductive for the growth of business with respect to country risk, infrastructure,

cultural compatibility and proximity. Thus, the consequences of sufficient English speaking

Indians, noteworthy excellence in work for US companies and others, and a comparatively low

labor costs have made India the most favorable destination for outsourcing.

Next to India, the name comes of Philippines for average low costs of the IT employees. The

education system of Philippines has a touch of the US system. It has been estimated that the total

outsourcing revenues earned by Philippines is estimated to be under $350 million. Ireland is the

pioneer of the largest destination of business process outsourcing in the world as the

infrastructure and educational system of the country is very good and the taxes are also quite

favorable. Large companies like Microsoft, Dell, IBM etc., have their development centers in

Ireland. Israel for its exceptionally expertise in programming workforce has become a favorable

destination for outsourcing. Israel has been ranked as a country that has an extremely skilled

programming workforce. Canada is another favorable destination for outsourcing as it is close

����

�

propinquity to the US. The favorable climate for business, cultural compatibility and lucid legal

system are the add-on facilities for Canada. South Africa is promising as an evident destination

for its IT manpower.

The Imminent destinations:

Countries like Ukraine, Russia, The Czech Republic, Poland, China, Pakistan, Brazil, Argentina

and Mexico are the upcoming destinations for outsourcing.

If the size of the BPO industry is considered, Argentina and the Czech Republic are great

challengers to China, Pakistan, Russia and Ukraine which are comparatively much smaller in

size, Argentina is a perfect outsourcing destination for low costs, hefty talent pool of engineers.

The key factors like relatively low costs, strong education system and cultural resemblance of the

Czech Republic with Western Europe helps the Country to have flourishing BPO industry. The

Ukraine is yet to enter fully into the Global IT offshore as it has to face the challenge of

economic changeover from the Soviet to the Western economy model. In Poland the

Government is trying with all its efforts to encourage the growth of IT Sector. Besides, Poland

has good infrastructure and comparatively lower cost than Czech Republic. In China the IT

Sector is growing fast as lot of new initiatives are taken by the Government in the recent past. In

addition to it, China also has the low cost structure. Now-a-days Pakistan is developing as new

destination for offshore information technology. The Socio-Cultural surroundings of Mexico

have a great semblance with the US.

Other destinations:

Countries like Chile, Venezuela, Thailand, South Korea, Malaysia, Vietnam, Singapore and

Romania are the other destinations for business process outsourcing.

According to a recent study focused on the top IT service providers of UK by Pierre Audoin

Consultants (PAC), a European market research and strategic consulting firm for Software and

IT services Industry (SITSI) it has been depicted that, India – the most favorable low-cost

destination for outsourcing is slowly and gradually losing its supremacy, giving rise to the

suitable outsourcing destinations like China, Morocco and Hungary which are the fast emerging

ideal choices for the IT services providers as offshore sourcing centers.

����

�

India: The Preferred Outsourcing Destination

Amidst competition from other developing countries, India was one of the developing countries

to benefit from the off shoring trends as it had a large pool of English-speaking and technically

proficient manpower. India’s off shoring industry took root in low-end IT functions in the early

1990s and has since moved to back-office processes such as call centre and transaction

processing. In the late 1990s, India’s abundant and low-cost software engineering talent,

combined with massive demand from the Y2K problem helped India to move up the value chain

to attract large-scale software development projects from US-based customers. Currently, India’s

engineering talent has made India the off shoring destination of American high-tech firms, led by

HP, IBM, Intel, AMD, Microsoft, Oracle and Cisco. Each of these companies promised to invest

at least $1billion (bpodiscuss.blogspot.com) in India, to supposed retain market share in the face

of competition and cost-cutting measures of competitors and industry in general, at the expense

of investment in the US.

India’s off shoring sector, the world’s largest and fastest growing, is dominated by IT services,

which play a major role in the country’s overall economic growth. By 2007-2008, it is estimated

that workforce will consist of about 1.450,000 to 1,550,000 people and the industry will account

for 7% of India’s GDP (www.shareservicesbpo.com).

Business Process Outsourcing Innovation and Growth Strategies

Today Business Process Outsourcing (BPO) function happens worldwide with the objective of

reducing the operational cost of the Product and to bring more product innovation and efficiency

in the service offerings to the customers through expertise service. Globally outsourcing was

earlier dominated by big players like IBM, CSC, EDS, Accenture and ACS. Now the trend has

changed, as more outsourcing companies have started their operations with more competitive

offerings than the major outsourcing firms could offer to their clients. With more than $100

billion contracts to be renewed in the next two years globally by the major outsourcing firms,

they fear that a major share of the outsourcing contract will shift towards other outsourcing

services. The outsourcing service providers mainly affected will be IBM and EDS, as both are

estimated to share a contract size of $50 billion in the outsourcing Industry.

New Outsourcing service providers are concentrating on their core competencies rather than on

����

�

other areas and this is what the outsourcing companies too are expecting from the service offers.

Moreover, products and services offered by them are more innovative and flexible to suit the

needs of the outsourcing clients.

In the multiple outsourcing landscapes, companies have started to outsource their activities to

more than one client for different functional activities. This gives the outsourcing companies the

great opportunity of getting benefits from different service providers. For example, ABN Amro

Bank Planned its outsourcing deals with five major offshore outsourcing companies of different

service outsourcing like IT infrastructure with IBM, application support service with Infosys,

Patni and TCS and application development with Accenture. This could provide a greater

advantage to ABN Amro in getting services from specialized service providers. The prospect of

Indian Outsourcing is challenged by the growing competition from global players. This could

have a major impact on the current growth trend of the Indian BPO Industry. But the global

delivery capabilities with multiple features will be a competitive advantage for Indian BPOs in

the global market. The next move by a global BPO industry in creating competitive advantage

over rival firms will be product innovation like innovative delivery business models, creative

designing of their work flow models by reducing the project run time and cost of service

marginally over the competitors, and flexible services to suit the clients base.

Core Competencies of Outsourcing

Business outsourcing is not a new practice; it has become the routine strategy of a company to

outsource the service to get them done better than they can do on its own. The primary focus of

the industry is to cut down the cost and to improve the performance of the output quality and

profitability considerably. The business strategy of the company is to concentrate on its core

activities and to outsource the remaining activities to the low cost third party service providers.

The competent strategies are success factors for each business organization as they make a

difference in the service offered to their business clients, Normally BPO Companies frame their

business models to suit the clients demand, so that they make their business successful. Each

BPO Company has got its strength in a particular area like product development, customer,

service, documentation, consulting and knowledge process, value creation, product promotion,

technical service, and support service. The companies work on the domain space in which they

��4�

�

have an advantage over their competitors. Today business has become more risky especially in

the outsourcing industry. Companies look for vendors who can provide quality services at low

cost i.e., cost and quality competence have become essential factors in the outsourcing industry.

The American industries look for competent vendors from outside countries which can increase

the financial performance of their business through their competent workforce.

In most of the outsourcing projects, spread of advanced processing technology provides full

speed and cost advantage to the contract service providers. The technical ladder of any offshore

or onshore activities is significant in intellectual outsourcing activities such as knowledge

processing and analytical processing. Companies have a greater global competitive advantage in

providing innovative products and services to suit the clients’ business needs. This enables them

to withstand global competition.

There is a pressing truth confronting business today. Technology does not provide solutions on

its own. Through business process outsourcing, the right people, processes, and technologies are

integrated to in order to gain maximum efficiency and achieve competitive advantage.

International Scenario of Outsourcing

• Internationally, the staffing industry has a growth rate of 20% per annum.

• In the last two years around 25 million contract staff was placed in major worldwide markets.

• International outsourcing companies specialize in ‘Interim Staffing’ and ‘Managed Services’.

• Major Outsourcing of engineers (Contraction and Software).

• Major Players in the international markets are Adecco, Manpower, Vidior, Randstad, Kellys,

Spherion Corporation, Robert Half PLC, Volt Staffing, CSG, CDI, Modis Professional.

National Scenario of Outsourcing

• Outsourcing is the single largest segment among all HR services.

• Its latent Indian market size is estimated to be worth about $2 billion – at present, only

$12 – 15 million actualized.

• Recent statutory changes facilitate flexible outsourcing.

• India strongly positioned to emerge as leader in technical skills relating to IT, process,

power and infrastructure, Life Sciences and Agro-business.

��5�

�

Benefits of Outsourcing

The concept of many entrepreneurs about outsourcing is that it is the practice of using outside

firms to handle work normally performed within a company. Small companies generally

outsource their payroll processing, accounting, distribution and many other important functions

often because they have no other choice. Many large companies turn to outsourcing to cut costs.

In response, entire industries have evolved to serve companies’ outsourcing needs.

The following are the main benefits of outsourcing

• Reduce and Control operating costs.

• Improve company focus.

• Access world-class capabilities.

• Free up internal resources for other purposes.

• Resources are not availability internally.

• Accelerate re-engineering benefits.

• Function difficult to manage or out of control.

• Make Capital funds available.

• Share risks.

• Cash infusion.

Fig.3.2 Benefits of BPO

Performance and profitability

Business process outsourcing is reported to improve performance and profitability of companies

besides help –

• Achieve operational excellence; leverage proven methods and innovative technologies.

'��(����1��7� ������� ������ ��� ���� �7� �������1� &��

2� ���1�(�8��

��������������� �

��6�

�

• Beat competitors in the market, with creative new products supported by full-functioning

systems.

• Respond quickly to market demands, without the headache of cultural barriers.

• Tap experienced pool of global resources to achieve cost savings without compromising

superior service; and

• Realign core talent to focus on market distinction strategies.

A step beyond IT outsourcing, Business Process Outsourcing (BPO) is increasingly becoming

the strategic choice of companies looking to achieve cost reductions while improving their

service quality, increasing shareholder value and focusing on their core business capabilities.

Leading organizations reduce costs and improve efficiency by outsourcing entire business

functions to firms like Accenture. BPO enables them to delegate technology –which owns,

administers and manages the processes, provides service according to defined metrics, and

continuously improves the processes over time.

Selecting an outsourcing partner

Since Outsourcing is a critical business decision involving crucial matters, the decision to choose

the outsourcing partner becomes a significant task. Selecting the right partner is most important,

as capabilities of the service providers would add value to the BPO function and capacity to

handle the operations on a global scale, act as key parameters for an outsourcing decision. A key

step in successful outsourcing depends on the selection of a right partner.

The Risks Involved

Although Outsourcing offers numerous benefits, it has some hitchers as well. The following are

some reasons, which could deter Organizations from following outsourcing.

• The process of outsourcing is not limited to selecting a right partner, but the

implementation of a project plan need expertise too.

• Several projects have failed to meet the return requirements on their outsourcing

investments.

����

�

• Transfer of certain sensitive information to the outsourcing partner may be against the

company policy.

• Monitoring the partner on key issues to obtain the desired result is a formidable challenge

faced by Organizations.

• Employee resistance can arise while outsourcing the existing functions.

Thus, it is evident that a clear communication between the strategic partner and the company is a

prerequisite for the process of outsourcing. Therefore, while making the outsourcing contract,

corporate tend to include various terms of the service in between.

Human Resources Problems are tackled by effective communication strategies with the

employees and by providing them with options to choose helps in employee morale when the

existing manual functions are being outsourced.

The number of BPO companies is on the increase. “EXL service” is one of India’s leading BPO

Companies providing phone and web-based service to corporations in the US and UK.

Anne Caldwell, President and founder of Outsourcing Solutions, says, “Outsourcing allows

companies to contract for services that are not within the scope of their expertise, so that they can

focus their time, money and energy on their core competencies, instead of wasting valuable

resources trying to gain understanding of areas that are somebody else’s expertise. Outsourcing

helps to lower costs as well as to gain an edge over others and increase efficiency.

3.6 GROWTH OF THE BPO INDUSTRY

The Last decade has seen the growth of the BPO industry. In BPO an Organizations critical or

non critical processes are managed using a technology/specialist vendor. The BPO differs from

an Application service Provider (ASP) as some amount of risk is transferred to the service

provider. The software, the people and the process management constitutes the BPO. The BPO

depends upon Information Technology and hence it is also called Information Technology

Enabled Services or ITES. The global BPO industry is worth more than US$ 150 billion dollars

and of this the offshore BPO is worth around US$12 billion. The Industry is growing at around

25% and is expected to grow at this rate till 2010.

����

�

Outsourcing received momentum, as the strategy for big troubled companies gradually started

being used by smaller companies as “a growth enabler and equalize”, the growing demands of

consumers and the need to generate profits have made even the smaller companies to outsource.

In addition to this, increasing competition rendered the newly introduced products in the markets

to turn stale and cheap. In order to keep up the margins and have a constant supply of new

products in the shortest time possible, the companies explored new avenues that can be

outsourced. After outsourcing several activities in core and non-core areas, companies have now

reached the most important area – R&D, for outsourcing. University of Manchester, Centre for

Research in Innovation and Competition, asserts “Firms, even large multinational corporations,

can no longer expect to be totally dependent on their in-house research and technology resources

to maintain innovative performance.

The need for greater flexibility, improved focus on core activities, reduction of capability gaps,

access to new intellectual property and specialist expertise, improvement in strategic image,

management of risk and costs, provision of enhanced quality and services, shortened time to

market products and the drive for change, have emerged as the strategic drivers behind

outsourcing R & D . It is estimated to account for a saving of 5% to 18% of the costs of major

electronics companies (www.outsourcing.com). Jack Faber, the vice president of operations,

enterprise systems for HP, said, “(Outsourcing) is a tremendous opportunity for cost savings on

R&D” (www.cio.com).

Today, outsourcing is capturing the mainstream of the business world. The latest trend hints

towards the fact that the outsourcing market will experience a persistent growth with the

escalating range of IT services. According to the recent trends,

a. Offshore outsourcing is progressively more consummate in the worldwide perspective as

global sourcing or global delivery.

b. Outsourcing has become more ubiquitous at this point in time than that of the former process

where the work was outsourced to a supplier who settles at home.

c. The expansion of organization in foreign country by a parent firm has the pool of human

resources of the parent firm only and not of the outsourcing supplier.

d. The other boosting option for business is transporting ecommerce out of the home country.

����

�

The business scenario of the global market shows that the companies that provide work for

outsourcing are more economically steady than the countries that do not. With this business

process outsourcing a number of global companies can save 35-55 percent of their relevant costs.

Over a decade, the industry has grown to a great level and will continue to grow in all the

locations. India is considered to be among the most preferred destination in the world. Reasons

for the preference of India are its skilled human resources with best infrastructure and climatic

conditions that are suited to the clients, business activities. India has more than 2 million

graduates and 3,00,000 post graduates coming out of colleges every year. These human resources

have the best English speaking skills. Outsourcing to India is cheaper than outsourcing to other

locations in the world and this is the main reason for companies outsourcing to BPOs in India.

“Outsourcing isn’t about moving jobs. It’s about the flexibility to put resources in the right

places at the right time”, said Dave Ayers, vice president for platforms and engineering, Lucent

Technologies (www.nationalacademics.org). Outsourcing over the decades, has evolved to

become a vital part of the global economy. Internationally, globalization has caused several large

companies such as Dell, Microsoft, Hewlett-Packard and Novell to outsource their operations.

Outsourcing emerged as a buzzword in business and management. Since then, it has been

adopted by companies around the world, especially the western countries, as an effective cost-

saving strategy. Having outsourced operations in diverse fields like manufacturing, information

technology, and human resource management, companies have turned to a new trend of

‘outsourcing innovation’.

Challenges for Indian BPO Industry

Sujay Chohan, Vice President and Research Director, Gartner says, “India dominates now and

will continue to do so in the future because of the sheer scale of skills in the country at low costs.

The only exception is China which has become very visible in this space

(http://www.businessweek.com).

India’s outsourcing Industries had to overcome major challenges to continue their growth and

sustain their advantage over other emerging outsourcing destinations. The first major challenge

was that the demand growth might slow down.

����

�

“Increasingly there is a realization that changing business processes to accommodate large

offshore workforces is difficult, time consuming task and often produces lower than expected

savings,” said Noshir Kaka, principal of McKinsey. The Unions and political opposition in US

towards outsourcing has raised concern about the future. Also problems about service Quality

and security were issues to be tackled.

It was predicted that in the current decade India would face a shortage of qualified workforce. As

NASSCOM-McKinsey study on India’s Information Technology and Business Process

Outsourcing “India need a 2.3 million strong IT and BPO workforce as of 2010 to maintain its

current market share, and potential shortfall of nearly 0.5 million qualified employees in supply

projection was expected.” Another area where India is lacking is the absence of large numbers of

workers who were fluent in French, German, Japanese and Spanish. This resulted in China and

Europe, becoming attractive off shoring destinations for Japanese and western European

companies.

High turnover rates and rapid growth of Indian outsourcing sector have increased the risk of

security violations and fraud. Several cases of fraud were reported in India resulting in creation

of NASSCOM, the leading industry association, initiating more rigorous background checks for

new employees. Saturation, congestion and inflation in the large cities has forced the Indian

market to go to tier-three cities including Ahmedabad, Kolkata and Jaipur, which offer lower

costs and less competition for resources. Industry experts said that in order to maintain its

advantage, India had to improve its infrastructure. Even though it was improving, it was not

keeping in pace with the rapid growth of the industry. As per Sujay Chohan another way of

facing the competition was to emerge as true global players. “Indian outsourcing companies

should also think about expanding their brand globally by setting up delivery centers outside of

India”. Indian companies, which have opened offices in foreign countries, were: Progeon at

Czech Republic, ICICI OneSource at Argentina and TCS at different locations like Uruguay,

Brazil, Chile, Hungary, China, Ausrtalia and Japan.

Ashank Desai chairman of Mumbai-based Mastek, was of the opinion that one way for Indian

companies to maintain their competitive advantage was to upgrade their services by offering

more sophisticated back office functions in addition to the basic call centre services. “At Mastek

we are looking into merging BPO and IT services so that our clients get double the advantage.

����

�

We can reconfigurate IT used for processing insurance claims to make it more efficient and then

process these claims more efficiently for our customers,” (www. offshoringtimes.com) said

Desai.

The Future:

Allien J. Delattre, Head of Accenture Lts.’ High-tech consulting practice said,“R&D is the

biggest single remaining controllable expense to work on, companies either will have to cut costs

or increase R&D productivity. Outsourcing Research and Development (R&D), the highest level

of the manufacturing supply chain, is increasingly drawing attention as a new method for

reducing the costs while attaining efficiency. Since 2000, HP, IBM and Motorola, the companies

that were considered as R&D powerhouses, have gradually reduced their R&D expenditures over

the years.

Companies that were previously well known for their technological innovations are also

outsourcing their product and software development activities. Large companies like Dell and

Philips are purchasing the complete designs of digital devices from developers and are selling

them in the market with modifications to suit their brand names. Examples of companies like

Boeing Co., which is co-developing software along with HCL Technologies of India for its 7E7

Dream liner jet and the pharmaceutical giants like GlaxoSmithKline and Eli Lilly, working with

Asia biotechnology companies to reduce the costs pertaining to new drug introduction in the

market, are reinforcing this new trend of outsourcing.

Outsourcing R&D is expected to minimize business risks, speed up market entry of products,

provide protection from market fluctuations, generate high returns on assets and make optimum

utilization of resources. It is also expected to enable the companies to divert the available

resources to other endeavors such as improving their organizational effectiveness, shortening

product development cycles, and gaining access to technology and improved resources.

Outsourcing of R&D to offshore companies also involves the problem of distance between the

outsourcing company (customer) and the supplier of the outsourcing services. Lack of familiarity

and intimacy between them weakens the relationship and product development. Azim Premji,

Chairman, Wipro Technologies, said, “To be a successful product company requires intimacy

with the customer. That is very hard to offshore in fast-changing markets”.

����

�

Dave Ayers, the vice president for platforms and engineering, Lucent, said, “This (Outsourcing)

frees up talent to work on new product lines” (massis.Ics.mit.edu). Executives are of the opinion

that R&D outsourcing enables them to reduce costs pertaining to wages and have engineers

working at different time zones. But Apple Computer’s CEO, Steve jobs finds such a perspective

to be shortsighted. He argues that “teamwork, communication and the ability to get groups of

people working together to bring a new idea of life”, is compromised for cost-savings

(www.businessweek.com). Apple computers has been a company contradiction to the trend of

outsourcing R&D. Apple has been successful in developing best-selling products like iPod,

shuffle and iMac., without adopting this new trend. Though its competitors are offering a wide

variety of their products, Apple has developed only a few but trend-setting models for the rest of

the industry. Although some of its products are manufactured by ODMs, all the key design

decisions are taken in –house to prevent the intellectual property loss.

Pertti Korhonen, Chief technology officer of Nokia, which for many years took pride in

developing most of its products, says that given the modern day technology and supply chain

complexities, the companies “… have to figure out what is core and what is context”

(www.businessweek.com ). The decision to outsource makes it essential for the companies to

have ‘sophisticated strategic thinking’ to determine the amount of intellectual property to be

outsourced and the amount to be developed in-house. The companies outsourcing R&D have to

differentiate between mission critical and commodity R&D.

While many companies are adopting the new trend, others still retain some part of the

development process like palm One Inc. (Change of Palm Inc.) and HP Though palm One has

also outsourced its hardware production to Taiwanese ODMs, it still holds control by deciding

on the presentation of the product, key components like display and core chips, and specifies the

performance requirements. This kind of collaborative way of working ,has enabled palm one to

reduce development times by months, reduce defects by 50%, and increase margins by about

20%. HP, on the other hand, has tied – up with design partners for hardware components.

With ODMs playing an important role in outsourcing innovation, concerns are raised that the

outsourcing companies may lose their edge on innovation and companies like Quanta and

Flextronics who are benefiting from this new trend, could emerge as new leading global players.

As quoted in the Business week, “The early evidence suggests that today’s western titans can

����

�

remain leaders by orchestrating global innovation networks. Yet if they lose their technology

edge and their touch with customers, they could be tomorrow’s great shrinking conglomerates”(

www.businessweek.com ).

Benefiting from this new trend are, ODMs like Quanta Computers Inc., Flextronics Corp., HTC

Corp., Premier Imaging, Wipro Technologies and Compal Electronics, which are gradually

emerging as the forces being the technology industry. The greater reliance of the outsourcing

companies on the ODMs, resulted in companies like Quanta to move a step further by building

and R&D center to work on next generation products doubling its 7,000 engineering workforce

and allocating $200 million for R&D expenditure. Similarly, Flextronics Corp., a US-based

electronics manufacturing Services Company, has spent more than $800 million an acquisitions

to build workforce of 7000 software engineers, chip, telecom and mechanical designers spread

across the world from India and Singapore to France and Ukraine. While the large companies are

reducing their R&D expenditures and reducing workforce, contractors like Quanta and

Flextronics are increasing their R&D staff, networks and expenditures. Barry Lam, Chairman,

Quanta Computers said, “What has changed is that more customers need us to design the whole

product… So we are forced to invest in innovative research in new products that are one or two

years ahead of the market” (/www.businessweek.com). But underlying this new trend is the

threat of losing the edge on innovation that could cause the conglomerates to shrivel.

3.7 THE EVOLUTION OF THE CALL CENTRE

The BPO industry started with call centers in the 1980s but came of age in the 1990s with the

introduction of new technologies like LAN based switches, internet based transaction processing,

client/server software systems, advanced call handling and custom management system. Search

CRM.com defines a call center as “a physical place where customer and other telephone calls are

handled by an organization, usually with some amount of computer automation. Typically, a call

center has the ability to handle a considerable volume of calls at the same time, to screen calls

and forward those to someone qualified to handle them, and to log calls”

(http://multichannelmerchant.com).

In many organizations, call centers evolved from back office operations that handled bulk,

simple processing inquiries. Today most call centers deal with a complex range of products and

��4�

�

services using a mix of tools and technologies. Agents handle multiple contact types from phone

to email to web-chat, and deliver both service and sales. They are no longer simply processing

transactions but are responsible for developing and building relationships with customers. This

calls for highly adaptable, skilled quick learning and customer focused CSRs.

In most industries call centres, like many other business units, are an integral part of the product

and service offering. They play an essential role in today’s business world, and often represent

the primary source of contact for customers (Miciak, Alan and Desmanais, Mike4, 2001). The

call centre industry has experienced incredible growth on both sides of the Atlantic, which is set

to continue (Cariner, S5, 1998). According to Reuters the western European call centre market as

a whole is expected to grow by 12% annually (Reuters6 2001). In European countries such as the

UK more employees work in call centres than in many traditional fields and recent figures

estimated that in 2001 2.2 percent of the UK population was working in call centres. One study

states (Marr, B and Schiuma, G7, 2001),

“Call centers are changing the way companies communicate with customers and are a strategic

asset in delivering exceptional service quality. Companies that focus on customer loyalty are

increasingly using their centre’s to differentiate their product or service offering and drive

customer satisfaction”.

Over the past few years, the call centre operation has experienced rapid growth (Houlihan, M8

2001). A call centre is an operation, consisting of as little as three people, which conducts

business telephonically (Rademeyer, D9 1995). Dawson10 (1997) says “ a call centre is a physical

location place where calls are placed, or received, in high volume for the purpose of sales,

marketing, customer service, telemarketing technical support or other specialized business

activity” with a strong technological foundation, call centres offer more flexibility and thus lower

the costs of meeting customer needs and expectations. Although there is no face-to-face contact,

emotional interaction is still involved. Using Call Centres for a number of business interactions

is ideal for today’s rapidly changing global markets (Prabhakar,P R Sheehan, M J & Coppett, J

I11 1997).

Call Centres are thus becoming increasingly important, both as an interaction channel as well as

an important source of customer related information. As call centres reach a new level of

��5�

�

importance for customer relationship management call centre agents become increasingly central

within the link between companies and customers (Burgers, A De Ruter, K Keen C & Streukens,

S12 (2000).

Call Centres also offer a number of additional HR challenges. They are often the career entry

point for the organization, so there is a high training requirement. And because call centres often

have a range of age groups employed, there is a need to manage the expectations of different

generations effectively. Job roles that combine sales with service make the design of reward and

incentive schemes challenging. A call center may employ a high percentage of part-timers

because of the complex staffing requirements of a 24x7 operations. Finally, the rigors of the call

center environment can even lead to occupational health issues from typing, use of headsets and

voice strain

3.8 DEFINITION OF CALL CENTRE

According to the Call Centre Association a call centre is a physical or virtual operation within an

organization in which a managed group of people spend most of their time doing business by

telephone, usually working in a computer-automated environment.

The broadest definition in the call center literature is that provided by Norling. Who states "a call

center is any communications platform from which firms deliver services to customers via

remote, real-time contact". Callaghan and Thompson apply a similarly inclusive definition,

stating that call centers may be "broadly defined as workplaces that integrate telephone and

computer technologies".

While these definitions usefully highlight the centrality of communication technology integration

in the call center field, it leaves the boundaries of the industry somewhat ambiguous. Taylor and

Bain narrow the definition by specifying the types of technologies used: "we define a call center

as a dedicated operation in which computer-utilizing employees receive inbound-or make

outbound-telephone calls, with those calls processed and controlled either by an Automatic Call

Distribution (ACD) or predictive dialing system. The call center is thus characterized by the

integration of telephone and VDU technologies."

��6�

�

Other authors narrow their definitions by focusing on the types of services which these integrated

technologies are designed to provide. For example, in an early definition, Richardson states

"telephone call centers are specialist technology-intensive offices that are established by

organizations in order to deliver services to customers over the telephone, replacing or

complementing face-to-face interaction with the public”. Similarly, Kinnie, Purcell and

Hutchinson provide a tripartite definition incorporating technology, technological control, and

tasks:

We define call centers in the following way:

i. Employees are engaged in specialist operation which integrate telecommunications and

information systems technologies;

ii. Their work is controlled by. automatic systems which virtually simultaneously distribute

work, Control the pace of that work and monitor their performance;

iii. They are in direct contact with the customer through dealing with in-bound calls, making

out.

According to researches, call centre’s allow a company to build, maintain, and manage customer

relationships by solving problems and resolving complaints quickly, having information,

answering questions, and being available usually 24 hours a day, seven days a week, 365 days of

the year. It is argued that call centres form the heart of successful customer relationship

management strategies (Michell, PJ13, 1998).

There is increasing evidence that call centre’s are gradually migrating into customer contact

centre’s (Acey,John14, 2002). Customer contact centre handle all relationships with the customer

and utilize multiple channels integrating traditional channels of telephone and fax, with newer

technologies such as e-mail, SMS, and WAP. According to Reuters, a contact centre is an

operational group within a business which is concerned with the development of customer

relationships, using integrated technology solutions and business processes. It is argued that

today’s call centres are complex operations that require a combination of technology, process,

and human talent in order to succeed.

����

�

3.9 TYPES OF CALL CENTRES

Two types of call centre exist and inbound and an outbound call centre, in bound call centre refer

to centre’s where the customer phones the call centre wherever out bound call centre require that

the call centre agent phone the client. In bound call centre handle customer service in general by

solving problems. Handling queries or answering questions about products or services. The

outbound call centre can be divided into sales and research outbound call centres. The sales

outbound call centre deals with the selling of products and / or services, whereas the research

outbound call centre gathers information regarding customer satisfaction, consumer behavior or

perception regarding products or services. In an outbound call centre it is very important that the

call centre agents possess the required competences.

The Call Centre as an Interactive System

The call centre is a system composed of different parts (Ruben15, 1983). This system cannot be

understood by studying the different parts in isolation (Senge16, 1990). These parts are all

interrelated and one part or subsystem will influence the other parts structure and function. The

structure of the call centre is defined by interrelation between the subsystems of customers,

management and call center agents (Miller and Miller17 1992; Vetere & Gale18, 1987).

Due to the interrelatedness of the subsystems, call center agents influence the perception of

customers regarding customers’ satisfaction. Each interaction between the call centre agent the

customer can be rewarded as an opportunity to either make or break the relationship in question,

because customer rate the quality of their personal experience every time they come into contact

with the organization (Miller19, 1999).

The perception that the customer has regarding the quality of service provided by the call centre

is dependent on the performance of the individual agents within the call centre (Burns20 1995).

Then Customers are delighted with the performance of the call centre agents, they will, as a

result, continue its relation with the given organization. The call centre agents have the ability to

make or break relationship even more so than inbound call centres.

Call centre agents are thus seen as key players in customer retention. They are as a contact point

between the customer and the company, and can therefore be regarded as the “source of

����

�

differentiation” (burgers et al21, 2000). As a result, excellent call centre agents can create a

competitive advantage (Strauss & Mang22. 1999).

Measuring Performance in Call Centres

According to professor Neely and his colleagues performance measurement can be defined ‘as

the process of quantifying the efficiency and effectiveness of past action.” (Neely, A, Adams, C

and Kennerley, M23 2002).

Alan Miciak of Calgary University and Mike Desmarais of the service quality Measurement

group maintain that the majority of measures in call centres are operational efficiency measures

and have to do with telephone technology (e.g. Average talk time, abandon rates. etc.) in use and

adherence of employees standards of practice (e.g. Occupancy rates, calls per hour etc.) (Miciak,

Alan and Desmanais, Mike24 2001).

Audrey Gilmore and Lesely Moreland identify the following measures which were all reported

on wall displays in various call centres (Gilmore, A and Moreland, L25 2000).

• Number of calls answered within past ten minutes.

• Calls waiting to be answered, that is ‘in the queue’

• Number of agents currently taking calls.

• Number of agents waiting to take calls (free agents)

• Number of ‘not ready’ agents.

• Number of agents on outgoing calls or on a call to another agent.

It was identified that agents paid close attention to the display and that they would not go for a

break if the displayed call situation would allow it.

Research indicates that call centre manuals provide some guidance about common measures of

call centre excellence (Tom, G, Burns, M and Zeng, Y26. 1997). Jon Anton of the Prudence

University in Indiana claims that the following measures help to track quality of call centre

service (Feinberg, R.A. Kim, I-S Hokoma, L27. 2000).

����

�

• ASA (average speed of answer)

• Queue time (amount of time caller is in the line for answer)

• Percentage of callers who have satisfactory resolution on the first call.

• Abandonment rate (the percentage of callers who hang up of disconnect prior to answer)

• Average talk time (total time caller was connected to telephone service representative).

• Adherence (are agents in their seats as scheduled?)

• Average work time after call (time needed to finish paper work, do research after the call

itself has been completed)

• Percentage of calls blocked (percentage of callers who receive a busy signal and could

not even get in to the queue)

• Time before abandoning (average time caller held on before giving up in queue)

• Inbound calls per TSR eight-hour shift.

• TSR turnover (the number of telephone service representatives who left in a period of

time, usually annually)

• Total calls and

• Service levels (calls answered in less than x seconds divided by number of total calls)

Measuring Customer Value and Service Quality in Call Centres

Call Centre Performance is critical to the image of an organization (Black, G28 1998). A study

conducted by the Purdue University found that 92% of US customers from their image of a

company based on their experience using the company’s call centre. The study also reports that

63% of customers even discontinue using a company’s products following a negative call centre

experience. This number even rises to 100% for customers between the ages of 18 and 25

(Delorey, E29 2003).

There is an obvious link between efficiency and performance, which is addressed by measuring

the operational efficiency measures. Besides operational performance measures, the literature

provides clear evidence of other aspects that impact performance but are rarely addressed in call

centre performance measurements systems. These are primarily links between the following

concepts.

����

�

• Customer satisfaction and both profitability and loyalty (Ziethaml, V A and Bitner, M J30

2000).

• Service quality and customer satisfaction (Heskett, J L, Sasser, W E and Schlesinger, L A31

1997).

• Employee satisfaction and service quality (Rucci, A J, Kirn, S P and Quinn, R T32 1998).

The chain of cause and effect have been described as the service profit chain (Heskett, J L,

Sasser, W E and Schlesinger, L A 1997) or, later, as the value profit chain (Heskett, J L Sasser,

W E and Schlesinger, L A33 2003), while others call it the Employee Customer profit Chain

(Rucci, A J, Kirn, S P and Quinn, R T 1998).

Today’s call centre customers want better service. They want to be treated better, have easier

ways of accessing services, with timely responses (Calk, J T34 1998). Some scholars define

customer satisfaction as an evaluation of product or service in terms of whether that product or

service has met their needs and expectations. Others confirm this view by defining satisfaction as

the result of a customer’s assessment of a service based on a comparison of their perception of

service delivery with their prior expectations. In this context it is important to understand

customer needs and expectations in call centre environments. Jon Anton of Purdue University in

Indiana has identified four basic reasons why customers desire to contact an organization (Anton,

j 2000).

• The customers have a question and needs an answer in order to proceed, i.e., “where do I buy

your product? What is the price?” etc.

• The customer wants the company to do something i.e., “Change my address”, “Send me a

manual”, “take my order for a new product”, etc.

• The customer has a problem with the product and needs assistance and guidance in resolving

the issue, i.e., technical support, help desk etc.

• The customer is emotionally upset with the product, and wants to know that the company

will set the situation straight, i.e., complaint resolution and anger diffusion.

Researches from the Netherlands identify the following 13 call centre customer expectations

using the work of research previously published by scholars in this field:

����

�

• Self-efficiency – employees’ belief that he/she is competent to execute the required activities

related to the job.

• Adaptability – ability to adjust behavior and handle interpersonal situations.

• Empathy – ability to show individualized attention and personal involvement.

• Time-speed with which the customer requests are solved.

• Communication style – ability to address customers’ service needs and adjust the language

for different customers.

• Reliability – ability to deliver on promises in a dependable and accurate way.

• Perception of commitment to service quality and customer satisfaction – commitment of the

employee perceived by the customer to provide maximum service quality.

• Empowerment-desire, skills, tools and authority as a front-line employee to service

customers.

• Staff attitude – characteristic that involves friendly and considerate service.

• Explanation – Clearness, truth and honesty when providing content and explanations to the

customer.

• Competence – skills and knowledge necessary to perform the service delivery.

• Security – confidentially when dealing with any service request and customer information, so

the customer can be free of any danger, risk or doubts.

• Knowing the customer – making an effort to understand the specific customer needs.

In call centers, telephone agents are the ones talking to the customers day-in and day-out and

therefore they can provide critical information about service shortcomings, possible bottle necks,

and future innovation. However, in a command-and-control environment these important inputs

are suppressed. We have to start treating our front-line employees as knowledge workers and

begin to leverage their knowledge and insights for continuous process and product innovation.

For this we have to create a learning culture and put in place the processes that allow insights to

be generated, communicated, and acted upon. In call centres communication is often very task

oriented and not enough time is spent really listening to be customers in order to

• Understand their needs and requirements from their perspective.

• Detect failures, bottle necks, or improvement potential

����

�

• Deliver service that satisfies the customer.

Front line agents can be involved in understanding and classifying the nature of demand. E.g.

Incoming calls are not wanted or unwillingly generated by other parts of the organization. By

analyzing and classifying demand, it becomes more manageable and more predictable. Overall, a

strategy-driven and integrated approach towards performance management in call centres will

improve operational efficiency and contribute to continuous innovation of the organization as a

whole.

The researchers suggest that call centres can use the four-scale model as the basis for

performance measurement, to identify training needs for employees, and as a recruitment and

selection template for call centre employees. Other scholars make the link between service

quality and satisfaction; they state that high levels of service are important since the number of

“a completely satisfied’ customer is one of the few predictors of long-term profitability (Jones, T

O and Sasser, E35 1995).

Service Quality and Satisfaction in Call Centres

Service Quality is different to satisfactions; in fact service quality is a determinant of customer

satisfaction. Satisfaction is driven by the customers’ assessment of the difference between

perception of service delivery and their prior expectation of that service. Service quality is more

of an overall impression of the relative perception of an organization and its service. In fact, the

findings from Purdue University show that one bad experience with call centres might cause

customers to stop using a company’s product or service (Delorey, E36 2003). This means that call

centres need to deliver on their service promise all the time if they want to avoid the risk of

losing customers.

Researchers also note that some customers actually rate service quality as more important when

contacting a firm through call centre contacts than when speaking to someone fact-to-face

(Driver, C and Johnston, R37 1998). Quality, in this context, is the net aggregated value of

benefits perceived in the service encounter over what the customer, had been expecting (Klaus, P

G38 1985). Therefore, firms have to pay particular attention to customers’ perceptions of the

service process. According to Bearden and his colleagues,( Bearden, W O Malhotra, M K,

Uscategui, K H39 1998) the benefits of increased quality of the service process will be twofold:

����

�

• Firms will improve the ability to attract new customers; and

• Retention rates among current customers will increase.

Wallace and his colleagues find that in call centres excellent service is often delivered through

the personal efforts of the front-line employees (Wallace, C M, Eagelson, G and Waldersee, R40

2000). Customer perceptions are strongly influenced by the attitudes and behaviors of contact

employees when evaluating the quality of the service delivered (Bowen, D E and Lawler, E E41

1992). The Australian researches Bennington and Cummane establish the link between since

quality and employee satisfaction (Bennington, L and Cummane, J42 1998). Their research on

total service experience (Call centre and in-person) has identified that nearly 4- percent of the

variance in customers’ satisfaction with service was found to be related to expectations of service

quality, helpfulness of staff, accuracy, results obtained, age of recipient and when recipients

perceived that the staff were satisfied in their jobs.

Importance of competent call centre agents

As call centers are a relatively new and a high growth industry, there is a constant need for

skilled individuals. Working as a call centre agent is a stressful job and requires a positive

outlook as well as perseverance. Amongst other things, agents need to keep their composure

when helping irate customers, must assist each other when necessary, and determine what to do

if a customer makes an out-of-the-ordinary request. It is often a frustrating job, accounting for

notoriously high turnover rates at most centres. SATeleLink (2001) reports that most call centre

agents stay in one position for a timeframe of thirteen months.

Challenging situations, such as dealing with rude, demanding or distraught customers, facing

crises, new and complicated technology and the pressure of constantly monitoring of each call,

contribute to a very stressful work environment (Cohead, K43 1995). As a result, call centre

agents resign on a daily basis, creating a constant need to appoint new agents (Peter, D44 2001).

Not only is the call centre environment a stressful one, but it can also be a boring one. The work

of a call centre agent consists mainly of answering phones or phoning respondents, and the

repetition of this process can be quite tedious (SATeleLink2001). SATeleLink reports that

turnover rates of twenty percent and higher is not uncommon. The cost of recruiting new agents

is a source of concern to call centre management. For this reason only able and well equipped

��4�

�

agents should be recruited.

The Competencies required, can be used in recruiting new agents for outbound call centres as

well as in identifying areas where current agents need training. When sending agents on training

courses, it is useful to know exactly what types of skills are necessary. Correct training can

reduce stress levels in agents as well as training costs. Within the ever-changing call centre

environment, an understanding of the core competencies of call agents would assist management

in ensuring that their staff has the right skills to manage their work in a stress free environment.

3.10 COMPETENCIES OF CALL CENTRE AGENTS

The following competencies are some of the competencies that the agent should have in the

interactional context of the call centre.

Communication

The existence, functioning and developing of an open system, like the call centre agent, requires

continual exchanges with different contexts. This exchange can take place in the form of

communication. Call Centre agents should have the ability to effectively convey ideas and

information and should be able to understand customers. Communication skills include:

Barnhart, R (2000), Boshoff, C (1999), Freeman, B & Rustnell, D (2000), N Q F. (1998), White,

C & Roos, V45 (2005).

• Effective questioning techniques.

• The ability to communicate with different people in a professional way without

personal feelings influencing the process.

• The ability to communicate with people from different walks of life.

• The ability to build rapport with the customer.

• The ability to provoke an interest in the research from the customer and in so doing,

induce and maintain a reaction from the customer.

• To be outspoken.

• Having a good voice and

• Speaking clearly.

��5�

�

Written communication skills are not always an important competency in all call centres.

Communication also includes nonverbal communications. Which includes hesitations, shifts in

tempo of speech, overtones of voice and so on, that the customer can hear over the phone?

Customers want the communications to take place in a conversational tone. Bateson46 (1972)

believes that nonverbal communication is more important than verbal communication as this

provides the customer with the underlying message that agents do not want to convey through

verbal communication, such as that they are upset; tired or unsure.

Although customers can’t see their body language, they can hear the nonverbal communication

in their voices. Call centre agents must ensure that they can communicate effectively with

different people. Such communication includes building rapport, provoking interest, conveying

information. Being outspoken, speaking clearly and performing these actions professionally,

without being affected by personal feelings.

Listening Carefully

Listening Skills, which demonstrate the ability and desire to listen actively is an important

competency for call centre agents. Feedback, according to the systems theory, is very important

to the functioning of any system. When agents do not listen to the feedback from the customer,

mistakes may become greater as agents do not take action based on the feedback (Ruben, 1983).

Agents thus have to listen carefully to self-regulate or self-enrich.

Listening ability, according to the literature includes;

• The ability and desire to listen actively.

• The ability to respond to the statements and comments of others.

• To use reflective responses and clarifying questions to assure the other person that they have

been heard.

• The ability to remember notable points covered by the customer.

• The ability to listen without being distracted by surroundings or personal matters.

• Sounding interested in everything customers have to say and

• The ability to correctly capture everything the customer says.

��6�

�

Listening skills should focus not only on sounding interested in what the customer says, but also

on correctly capturing everything that has been said. Agents should also remain unaffected by

their surroundings whilst talking to the customer on the phone.

Attentiveness

Being attentive is a critical competency of call centre agents. Being attentive and detail-focused

is an important concept in systems thinking, as it allows the call centre agent to focus on the

customer as a whole and also to keep detail to such as the context of the customer in mind

(Senge47, 1990)

The literature (Bennington, Cummane, Conn48, 2000; Freeman & Rustnell,49 2000; Spencer &

Spencer50, 1993) explains being attentive as:

9 Having a concern for accuracy and quality;

9 Correctly completing work;

9 Monitoring and checking work;

9 Delivering on promises dependently and accurately;

9 The ability to gather accurate and detailed information.

9 The ability to correctly capture relevant responses.

9 The ability to raise accurate points; and

9 The ability to be through and detail-focused.

Agents should be thorough and detail-focused, be accurate and to the point.

Understanding

Understanding is also referred to in the literature as having empathy. According to the systems

approach, it is impossible to understand customers without putting them in context. It is thus

important to include the customers’ emotional experience and how it is constructed and

processed, or as Johnson (1998) puts it, the other intrapsychic half of the feedback loop.

Being understanding includes (Boshoff & Allen, 2000; NQF, 1998; Spencer & Spencer, 1993);

9 Understanding the customers’ predicament and making an effort to understand the

customers’ specific needs;

����

�

9 Providing the customer with caring, individualized attentions;

9 Having a balance between being neutral and getting involved; and

9 Being considerate to the customers’ situation by, for example, phoning them back at a later,

more convenient, time.

Although agents are pressed for a certain number of interviews, they should at all times be

understanding and give customers the opportunity to finish their complaint regardless of its

relevance. Understanding agents should remain professional at all times and not let personal

opinions and beliefs influence their understanding of the customers’ situation. Agents must

therefore focus on how to be more understanding in any situation without getting emotionally

involved. Call centre agents must be considerate to the customer’s predicament and provide the

customer with caring, individualized attention.

Attitude

According to the systems theory each person’s response in a relationship is organized by the

response of the other person in that relationship (Bateson, G 1972). A call centre agent’s attitude

will thus influence the customer’s attitude. For example, if the call centre agent has a friendly

attitude, it will pull for an even friendlier response from the customer, for this reason it is

important that a call centre agent has the correct attitude.

Call centre agents should (Boshoff, C51 (1999), Career Services52. (2001), Lorimer53, 1999).

• Consistently maintain a friendly and professional attitude, regardless of the customers

attitude, the time of day, or any personal matters.

• Be considerate, self-motivated, professional, helpful and pleasant.

• Remain positive and energetic throughout the day.

• Have a good sense of humor.

• Go out of their way to help the customer and answer any questions or solve any problems

the customer has.

• Be polite and patient by being willing to repeat questions, explain confusing questions in

the questionnaire, answer the customers questions and give customers the opportunity to

state their case.

�4��

�

• Treat customers with respect, even when they are abusive; and

• Approach customers in the correct manner.

Because call centre agents have contact with customers the entire day, their attitudes are very

important. The call centre agents must be positive and energetic. They should deal with the

customers respectfully; polite, friendly, and helpful at all times remain professional.

Consistency

Call centre agents should be consistent throughout the day. Being consistent includes (White &

Roos, 2005);

• Having a positive attitude throughout the day and not letting personal matters influence

interaction with the customer.

• Maintaining a balance between being impartial and getting emotionally involved and

• Treating all customers in the same way.

Call centre agents must remain consistent throughout the day. Being consistent includes being

neutral. They should not let personal issues affect their interaction with the customer.

Confidence

Being Confident is imperative in order to be a competent call centre agent. Having confidence

(White & Roos, 2005)

9 Will ensure that the customers accommodate agents by participating in the interview;

9 Assists agents to deal with rude customers; and

9 Is to be brief and to the point.

Call centre agents, they must be sure that they are confident.

Control

According to Vetere and Gale (1987), the capacity of a system to execute control depends on the

amount of information it can process and store. All control process depends upon

communication. Control is very important because it puts the agent in charge of the interview.

The call centre agent has the power to decide whether to continue with the interview or not.

�4��

�

When customers become abusive, agents can end the interview.

Agents should not let the customer talk about irrelevant matters, but should remain in control of

the interview in a professional manner.

Knowledge

Competent call centre agents should be knowledgeable about the product or service knowledge.

This involves knowledge about

• The benefits usage and features of the product or service..

• Adequate knowledge to answer all the customers questions, whether these concern

products, services, the company itself or the research and the questionnaire.

Management briefs to the agents before the start of each new project to enlighten the agents

about the people, service or general purpose of the project. Agents should acquire the requisite

knowledge before they start working.

Speed

Customers want their requests to be solved in a timely manner (Boshoff 1999, Jones &

Jaebeom54, 1997). Acquiring all the identified competencies, for example confidence, knowledge

and basic telephone manner, will contribute to a speedy interview. Better typing skills would

lead to a faster interview.Call centre must possess the techniques to conduct a fast but effective

interview.

Unpredictability

Call Centre agents must be able to handle the unpredictability of the call centre. As the call

centre is a very unpredictable environment, it is important for agents to manage this

changeableness. Agents having briefing sessions and dealing with similar difficult situations will

assist in making the call centre a more predictable setting.

Flexibility

According to the systems theory, flexibility will allow the creation of a new system through

social change (Bateson55, 1972). If call centre agents are flexible, they will be able to adapt to

�4��

�

management and the customers’ demands, thus ensuring a satisfied customer base.

Flexibility is defined according to the literature service centre (Roles & Responsibility Review,56

2002).

• As the ability and willingness to change.

• Keep an open mind.

• Implement new approaches.

• Maintain perceptual objectivity.

• Stay objective.

• Be resilient.

• Manage the process of change.

• Conform to procedures.

• Adapt to certain processes and

• Deal with customers from various walks of life and adapt to their specific needs.

Agents should not compromise professionalism in any situation, but be flexible and adapt to the

requirements of the situation. Flexibility and adaptability should therefore be qualities of call

centre agents, because customers will appreciate call centre agents accomplishing them in their

language or by keeping their age, status or background in mind.

Language

Ford and Lerner57 (1992) believe that meanings can be communicated if different individuals

have the same linguistic images linked to similar abstract representatives. Understanding each

other’s language will activate one another’s abstract and imagistic representations.

Customers prefer to conduct the interview in their language of choice. Call centre agents should

be capable of speaking more than one language fluently, in addition to English and give

preference to bi-or even multilingual. Current agents receive lessons in second or third languages

in order to be fluent in whichever language the customer prefers.

Challenge

According to Levine and Fitzgerald58 (1992), as the call centre develops as a system develops, its

�4��

�

dynamic structure emerges as a result of feedback processes. Call centre agents should find

adapting to the demands of the feedback a challenge. The call centre is an unpredictable setting

accomplished by various challenges. Competent call centre agents will perceive situations such

as rude customers, negative feedback, persuading a person to partake in an interview and not

knowing what to expect next, as a challenge. Call centre agents should be capable to face a

challenge someone who perceives the unpredictability, the abuse from customers and negative

feedback as challenging.

Goal-orientation

In the context of the systems theory goal-orientated behavior is a reaction to negative feedback,

or as Senge59 (1990) calls it, balancing or stabilizing feedback. For example, if the feedback from

the customer is that the interview should be shorter, the agent sets a goal to conduct a faster

interview. Call centre agents should be goal-driven in order to reach targets set by management

i.e., being goal-driven means tolerating rude customers in order to reach targets.

Proactive Problem Solving

Senge (1990), states that being proactive means “being in charge of your future, proactive agents

can influence the bigger system (the organization), which is again part of a biggest system

(society), which can, in turn; influence the future of the organization. Proactiveness comes from

seeing how we contribute to our own problems”.

Problem solving skills, (Barnhart competencies on target60, 2001)

• Represent analytical thinking processes in order to solve problems.

• Is reflected in call centre agents ability to gather information and select the best

possible solution.

• Include practical intelligence, reasoning, planning skills and creative thinking and

• Require initiative, quick thinking, and provision of information.

Call centre agents to be proactive, not just in providing information, but also in solving problems

or dealing with any other issues. It is important call centre agents are proactive problem solvers.

�4��

�

Teamwork

A system is a whole, which is constructed of various subsystems. Each of these sub systems

contributes to the bigger system’s performance (Levine, RL & Fitzgerald, 1992). It is thus very

important for each call centre agent to perform individually and in a team, in order to contribute

to the overall performance of the call centre.

Collaboration and the ability to work in a team imply working cooperatively with others, which

requires interpersonal skills. The necessity of call centre agents being able to work independently

and also in a team is very important. Poor work performance will influence the entire teams

performance. Call centre agents should be good team players who are also able to work

individually.

Basic Telephone and Technology Skills

All Call Centre agents must have the ability to apply computer or telephone technology. Other

basic skills include: (Career Services, 2001, Competencies on target 2001, Freeman.B &

Rustnell.D61 2000, N Q F, 1998);

• Typing skills.

• Retrieving information from the database.

• Good telephone manners and

• Computer literacy.

Competent call centre agents will posses basic telephone skills such as how to greet customers

appropriately, how to use the respondents name throughout the interview and how to read

properly. The call centre agents should have these basic skills for a better performance.

Stress Tolerance

Stress causes a variable to take on a value close to the higher or lower level of the next variable,

resulting in a lack of flexibility. Because the variables are interdependent, the other variables also

suffer lack of flexibility. To ensure flexibility in the call centre, it is important to keep stress

levels as low as possible. Because the call centre environment is a stressful environment, which

management cannot do a great deal about, call centre agents should be stress tolerant.

�4��

�

Call Centres are stressful environments in which call centre agents must deal with rude,

demanding, or distraught customers, face crises, work with new and complicated technology and

constantly monitor each call. Being stress tolerant is the ability to perform even under conditions

where pressure, resistance or opposition makes completing the work difficult. Being stress

tolerant is the ability to remain productive in times of crisis or critical events.

Contributors to stress in the call centre include

• Dealing with rude customers.

• Pressure from management, who expect a certain number of calls in a certain timeframe.

• Working in a team and contributing to the team effort, and

• If the performance is lower than other agents performance.

Competent call centre agents will be able to deal with stress caused by the targets set by

managements, and will still keep the customers happy and contribute to the team performance.

Training recommendations would be a stress management course, how to handle a huge amount

of work in a certain timeframe or how to handle abusive customers. When recruiting new agents

management should look for agents who are able to cope with these stressful situations. The

agent as part of a bigger system should remain as stress free as possible in order to ensure

flexibility.

Since call centres are becoming increasingly important, both as an interaction channel as well as

an important source of customer – related information, call centre agents also become

increasingly central within the link between companies and customers. In view of the pressing

demand for increase in competence and performance of call centres, the work place of the call

centres tend to be more stressful. Sufficient researches have to be made to evolve competent

strategies for successful stress management.

Wallace and his colleagues find that in call centres excellent service is often delivered through

the personal efforts of the front-line employees (Wallace, C M, Eagelson, G and Waldersee, R62,

2000) Customer perceptions are strongly influenced by the attitudes and behaviors of contact

employees when evaluating the quality of the service delivered (Bowen, D E and Lawler, E E63,

1992).

�44�

�

Employee Satisfaction

Jeffrey Pfeffer notes in his Harward Business School Press book that since it is becoming

increasingly difficult to establish a competitive advantage from the range of services offered, in

many service firms, it is the contact centre employees, and not the services themselves, which are

the source of differentiation and create a competitive advantage (Pfeffer, J64, 1994). It seems to

be the general perception that employee satisfaction of front-line call centre employees is not a

measure that is seen to be critical. Call centres are often associated with high stress levels, high

staff turnover, and emotional burnout. Research by the ACA reported that call centre employees

have a higher stress profile than coal miners and found that the median stay of agents in call

centres to be only 15 months (ACA, 1998).

Frenkel and his colleagues found that the often heavily task-focused control systems require call

centres to pursue supportive supervision in order to avoid employee burnout (Frenkel, S J, Tam,

M, Korczynski, M and Shire, K65, 1998).

In order to tackle the trade-off between service orientation and cost focus, management needs to

play two different but complementary roles. Besides placing and emphasis on operational

performance, they are also required to provide emotional support for the staff (Hallpin, A W and

Winner, B J66, 1957).

However, the reality is that the management approach in call centres is predominantly concerned

with operational measures; one could say it is a production-line approach efficiency. This is

supported by research that reveals that although call centres monitor customer satisfaction and

quality to varying degrees, they all rely heavily on task-focused management and measurement

systems, which include performance objectives weighted towards numerical quotas and targets

for efficiency and speed (Yin, R K and Campbell, D T67 (1994).The above evidence seems to

suggest that managing front-line employees is at the core of managing call centre performance.

However, it seems that the human aspect is often ignored in today’s cell centres. Evidence in the

literature suggests that performance management in call centre environments missed the

evolution seen in the field of general business performance management since the beginning of

the 20th century right through until today. This evolution can be described as one from the

machine age to the information age, or from scientific management to the management of

�45�

�

today’s complex and global knowledge economy (Cariner, S68 1998).

Business Process Outsourcing (BPO), a buzzword, is the mantra of employment in the present

times and a promise for the future. On the flip-side, however, BPO is characterized by lopsided

working hours, high stress to the extent of burnout and extremely high attrition rates. Though the

outsourcing industry has been growing by leaps and bounds during the past decade, we know

very little about what can be done for coping with the mounting problems in this brand new

industry. Despite potential for tremendous growth, BPO industry continues to suffer from high-

level of attrition stemming from factors like high-levels of stress and lack of opportunities for

growth.

3.11 VOICE–BASED BPO INDUSTRY IN INDIA: CHALLENGES

In the beginning of January 2007, twenty UK’s largest services suppliers have begun 21 new

global delivery centers. Out of these only two centers were located in India and four such centers

were set up in China, While Eastern Europe and Morocco had three each.

“India’s Position as the premier low-cost IT sourcing center is not under serious threat in the near

term. But what we are seeing is a vendor looking to reduce their reliability on India’s heated

labor market……” Nick Mayes, a senior consultant at PAC, said in a statement.

The BPO Industry in India is presently confronting the challenges cropping up for its astounding

growth. In India the fastest growing Industry is comprised of both the IT enabled services (ITES)

and Business Process Outsourcing (BPO), The ITES sector in India is projected to spawn almost

2 million jobs in the few years ahead. A Nasscom – Mc Kinsey report states that the industry has

earned $1.4 billion revenues in 2002, and is anticipated in 2008 to grow sharply to $24 billion.

The Government has also taken some initiatives to promote ITES companies in India. It has

exempted corporate tax for all ITES companies till 2010. At Present out of 83 SEI CMM Level 5

companies there are 53 companies in India Which have experienced 30% cost savings in the first

year. This has made India one of the most eye-catching destinations for outsourcing especially

for the 82% US Companies.

The Circumstances on the Other hand, are not as glowing as it appears for this segment with

massive prospective. Akin to several industries at the time of its development phase, this

�46�

�

particular industry is also sharing a lot of instability. The very sharp growth of this industry has

created immense problem for it. Though, according to the experts the ups and down in the voice-

based BPO industry has helped it to become stable and mature.

The BPO industry in India is facing a deficiency of experienced management professionals at the

middle and senior level management to handle the business process operations. This tersely

clarifies the significance and worth involved to the aspect of human resources in the service

industry. This has been agreed by Nasscom that scarcity of managers at the middle and superior

level is in fact a decisive concern for the BPO industry in India. There is no problem with the

employment of the available fresher’s getting recruited at the entry-level with excellent

proficiency in Language in the BPO sector. Some of the reliable reports show that the big and

reputable business process outsourcing companies bear 45 percent of attrition besides the

average industry attrition of 35%. It has become a trend in the industry to hire efficient people

from the competitor companies which are again becoming an impediment for the smooth growth

of the industry as a whole. The next issue is the high attrition rate. Attrition is the vital problem

which calls for not only the slaughtering of talents but also includes the training expenses of the

fresh recruits. The Indian BPO industry in general holds an employee for 11 months whereas, the

UK call centers retain an employee for an average of 3 years. It is predicted that once the growth

of the BPO industry gets stabilized, the attrition rate will steadily come down. Numerous reasons

are accountable for the high attrition rate in Indian BPO industry as high strain levels, dull and

repetitive nature of job, inconsistency in demand-supply and little probability in the career

growth prospective on the professional frontage loss of individuality, disparity with usual cycle,

absolute alteration in life style and lack of case on the personal façade.

The strategic corporate players are putting their entire Endeavour to fasten the pool of employees

with the number of amenities. They are provided with outstanding infrastructure facilities like

well planned air – conditioned roomy work stations, industry specific privileges like 24/7

cafeterias, transport facilities like pick-up from home and drop from office to home. Besides,

there are standard retirement benefits along with the low rates of interest for personal loans of the

employees, special incentives like weekend blasts, tickets for clubs, dance parties and music

shows. Some of the BPO industries are even promoting the prospective employees for higher

education which is one of the best ways of keeping the talented employees in the organization for

�4��

�

few years. These conveniences are quite suitable for the employees in the age group of college

pass-out twenties. The BPO industry has also taken care of the other employees on the reward

front with a hefty hike on the pay packages and performance incentives.

All these procedures are taken from the organizational front. Different companies have made an

effort to enter into unofficial contracts with contenders to evade poaching. However, these

contracts have no authorized sacredness; they are supported by mutual trust of the companies.

Instances can be taken from GE, Microsoft, Nipuna, HSBC etc. which have unofficially settled

that they will not employ a candidate who has been with his former company for less than 12

months or has changed frequent jobs (3 jobs in 2 years). Likewise, infowavz Tracmail,

Transworks, Global Telesystems and Epiccenter, all have come into a sporty discretion to detain

poaching. It has been still found that the attrition has been curbed partially with all these

measures taken on behalf of the organizations. According to the experts, apt recruitments

strategies, managing and developing employee self-esteem are some of the important areas to

check the attrition. Recruitment of right people at the right place throughout the organization at

different management levels can be an added factor for the organization to retain the human

assets. Proper training of the employees is also indispensable to slow down the attrition rate as

well as building team leaders and managers to take the higher responsibilities. An efficient

management facilitates in holding attrition at the different levels and strengthens the culture and

character of an organization.

3.12 From BPO to BPM

IT industry body Nasscom says, the acronym BPO, for business process outsourcing, does not

reflect the industry as it stands today. The apex body will henceforth use the term BPM, or

business process management.

The Indian Business Process Management industry has experienced key transformations over the

past few years, gaining experience, maturity, and gravitating towards higher-end services and

global competitiveness.

• This has been a very good year for the industry and we have seen a growth of 16.3%. This year

(fiscal) the industry will cross $100 billion mark,” NASSCOM chairman Rajendra S Pawar

said.

�5��

�

• As per estimates by the industry body, total revenue of the sector will be $101 billion out of

which $69 billion will be from exports and $32 billion from domestic market.

• Stating that the current environment has become uncertain due to a variety of factors such as

the elections in the US, Eurozone crisis and India’s own “policy paralysis” among others,

Pawar said for the fiscal 2012-13, the industry is expected to grow between 11-14%.

• The industry can meet the vision 2020 target of touching $225 billion provided it grows at a

compounded annual growth rate of 13% from fiscal 2012-13, he added.

Fig.3.3 Key facts of Indian BPM Industry

3.13 NASSCOM KEY HIGHLIGHTS ON INDIAN IT-BPO INDUSTRY

FY2012 is a landmark year – while the Indian IT-BPO industry weathered uncertainties in the

global business environment, this is also the year when the industry is set to reach a significant

milestone – aggregate revenue for FY2012 is expected to cross USD 100 billion. Aggregate IT

software and services revenue (excluding hardware) is estimated at USD 88 billion.

�5��

�

Fig.3.4 Key Highlights during FY2012 (IT-BPO Revenues)

• Milestone year for Indian IT-BPO industry-aggregate revenues cross the USD 100 billion

mark, exports at USD 69 billion

• Within the global sourcing industry, India was able to increase its market share from 51 per

cent in 2009, to 58 per cent in 2011, highlighting India’s continued competitiveness and the

effectiveness of India-based providers delivering transformational benefits

• Export revenues (including Hardware) estimated to reach USD 69.1 billion in FY2012

growing by over 16 per cent; Domestic revenues (including Hardware) at about USD 31.7

billion, growing by over 9 per cent

• Software and services revenues (excluding Hardware), comprising nearly 87 per cent of the

total industry revenues, expected to post USD 87.6 billion in FY2012; estimated growth of

about 14.9 per cent over FY2011

• Within Software and services exports, IT services accounts for 58 per cent, BPO is nearly 23

per cent and ER&D and Software Products account for 19 per cent

• The industry continues to be a net employment generator - expected to add 230,000 jobs in

FY2012, thus providing direct employment to about 2.8 million, and indirectly employing

8.9 million people

�5��

�

• As a proportion of national GDP, the sector revenues have grown from 1.2 per cent in

FY1998 to an estimated 7.5 per cent in FY2012

• The industry’s share of total Indian exports (merchandise plus services) increased from less

than 4 per cent in FY1998 to about 25 per cent in FY2012

• While the global macroeconomic scenario remained uncertain, the industry exhibited

resilience and adaptability in continually reinventing itself to retain its appeal to clients

• Embracing emerging technologies, increased customer-centricity, deepening focus on new

markets, adopting new business models are some successful growth strategies followed by

the industry.

Domestic IT-BPO

Domestic IT-BPO revenue (excluding hardware) is expected to grow at almost 17 per cent to

reach Rs 918 billion in FY2012. Strong economic growth, rapid advancement in technology

infrastructure, increasingly competitive Indian organizations, enhanced focus by the government

and emergence of business models that help provide IT to new customer segments are key

drivers for increased technology adoption in India.

Fig.3.5 Key Highlights during 2012-Total Domestic Market

�5��

�

• Uptake of IT-BPO in India is steadily increasing, with demand coming from both consumers

and enterprises, government’s technology infrastructure initiatives, unified communications

and availability of world class telecom infrastructure and services

• IT services is the fastest growing segment in the Indian domestic market, growing by 18 per

cent to reach Rs 589 billion, driven by increasing adoption from all customer segments –

government, enterprise, consumers and SMBs

• Domestic BPO segment is expected to grow by 17 per cent in FY2012, to reach Rs 149

billion, driven by demand from voice-based (incl. local language) services and increasing

adoption by both traditional and emerging verticals, including the government

• The domestic software products segment is set to grow to Rs 180 billion in FY2012, a

growth of ~13 per cent over FY2011. This segment is being driven by the need to replace

legacy systems and technology advancements around cloud, mobility, etc.

• Domestic Hardware market to cross Rs 615 billion in FY2012, driven by rapid uptake in

notebooks/net books/tablet computers, mobility devices, improved connectivity tools, etc

• Domestic customer base comprising the government, large, micro, small & medium

enterprises and household consumers, represent unique set of requirements

• Suppliers are realigning themselves to suit India specific needs and innovating new ways to

target customers

• Direct employment within the domestic IT-BPO sector is expected to grow by 7 per cent

over FY2011 to cross 600,000 employees with the industry creating immense job

opportunities in Tier II and Tier III cities.

�5��

�

NASSCOM Report on Top 15 BPO companies from 2007 to 2012

Year 2007-08 2008-09 2009-10 2010-11 2011-12

S.No Company Name Company Name Company Name Company Name

Company Name

1 Genpact India Pvt. Ltd.

Genpact India Pvt. Ltd.

Genpact India Pvt. Ltd.

Genpact India Pvt.

Ltd.

Genpact India Pvt.

Ltd.

2 WNS Global Services Ltd.

WNS Global Services Ltd.

Tata Consultancy

Services BPO

Tata Consultancy

Services BPO

Tata Consultancy

Services BPO

3 IBM-Daksh

Business Process Services Pvt. Ltd.

Tata Consultancy

Services BPO

WNS Global Services Ltd.

WNS Global

Services (P) Ltd

Aegis Ltd

4 Aditya Birla

Minacs Worldwide Ltd.

IBM-Daksh Business Process

Services Pvt. Ltd.

Wipro BPO Aegis Ltd Wipro BPO

5 Tata Consultancy Services BPO Wipro BPO Aegis Ltd. Wipro BPO

Firstsource Solutions

Ltd.

6 Wipro BPO Firstsource Solutions Ltd.

Firstsource Solutions Ltd.

Firstsource Solutions

Ltd.

Aditya Birla Minacs

Worldwide Ltd.

7 Wipro BPO Aditya Birla

Minacs Worldwide Ltd.

Infosys BPO Infosys BPO

WNS Global

Services (P) Ltd.

8 Infosys BPO Aegis Ltd. Aditya Birla

Minacs Worldwide Ltd.

Aditya Birla Minacs

Worldwide Ltd.

Infosys BPO

9 HCL BPO Infosys BPO HCL BPO

Exl Service.com (India) Pvt

Ltd

Serco Global

Services

10 EXL Service.com (I) Pvt. Ltd. HCL BPO

EXL Service.com (I)

Pvt. Ltd.

Hinduja Global

Solutions Ltd

Exl Services

Fig: 3.6 TOP 10 BPO companies in India (Source: Nasscom)

�

3.14 HISTORY OF THE FOUR SELECT BPOS

For the purpose of the study four BPO companies have been selected from the above top ten

BPO organizations the detailed history of which has been given as below.

3.14.1 GENPACT

The following table reveals the profile of Genpact with the latest updating.

Type Public company

Traded as NYSE: G

Industry IT , Business Process Operations Management, including

transformation and

Founded 1997

Headquarters Danbury, Connecticut

Key people N.V. Tyagrajan

Revenue $ 2.20 billion (2013)

Employees 60,500+ (2013)

Website www.genpact.com

Fig: 3.7 Key highlights of Genpact 2013

Genpact Limited, formerly a GE

or GECIS offers analytics and research,

enterprise application services, and IT information services. It operates in India, China,

Guatemala, Hungary, México, Mor

Spain, South Africa, Australia, UAE, Brazil, Kenya, and the United States.

Genpact India Pvt Ltd

Top of the list and ranked no 1 in the BPO sector is Genpact India Pvt Ltd. Founded in 1997 the

company now has operations in 13 countries via its 30 operation centres. The operating centers

corporate powerhouses such as Hyatt, GE, Nissan and Wachovia.

3.14 HISTORY OF THE FOUR SELECT BPOS

For the purpose of the study four BPO companies have been selected from the above top ten

history of which has been given as below.

The following table reveals the profile of Genpact with the latest updating.

company

IT , Business Process Operations Management, including

transformation and outsourcing

Danbury, Connecticut, USA

N.V. Tyagrajan (President & CEO)

2.20 billion (2013)

60,500+ (2013)

www.genpact.com

Fig: 3.7 Key highlights of Genpact 2013 (Source:

GE owned company called GE Capital International Services

and research, financial risk management ,supply chain

enterprise application services, and IT information services. It operates in India, China,

Guatemala, Hungary, México, Morocco, the Philippines, Poland, the Netherlands, Romania,

Spain, South Africa, Australia, UAE, Brazil, Kenya, and the United States.

Top of the list and ranked no 1 in the BPO sector is Genpact India Pvt Ltd. Founded in 1997 the

y now has operations in 13 countries via its 30 operation centres. The operating centers

corporate powerhouses such as Hyatt, GE, Nissan and Wachovia.

�5��

For the purpose of the study four BPO companies have been selected from the above top ten

(Source: Nasscom)

owned company called GE Capital International Services

supply chain, procurement,

enterprise application services, and IT information services. It operates in India, China,

occo, the Philippines, Poland, the Netherlands, Romania,

Top of the list and ranked no 1 in the BPO sector is Genpact India Pvt Ltd. Founded in 1997 the

y now has operations in 13 countries via its 30 operation centres. The operating centers

�54�

�

The company became independent in 2005 to provide it services outside the GE family. The

country provides round the clock services to around 600 clients across 18 countries in

25langauges via its 67 delivery centers. The country is pioneer in bringing the Six Sigma

technology for process transition.

Currently it employs over 60,500+ people in various locations providing services in over 25

languages on a 24/7 basis.

HISTORY

It began in 1997 as a business unit within GE Starting first with the business of GE Capital and

then expanding scope across GE businesses, to providing business process management.

Genpact went public on NYSE on August 2, 2007 under the symbol "G".

The NYSE symbol "G" was initially allocated to the Gillette company. After the Gillette

Company was acquired by Procter and Gamble, the symbol became free and Genpact and

Google booked it. Genpact got to keep G as its stock symbol.

Apart from GECIS, Genpact has also been known as GECSI and GECIBS in its initial days of

operation.

In 2009, Genpact introduced its Smart Enterprise Processes,. Genpact’s Smart Decision Services

sell advice to its clients through targeted analytics, reengineering knowledge, and risk

management. SEP methodology was reviewed and recognized by International Data Corporation

(IDC) and other Industry Analysts.

Latest Acquisitions

July 2012: Genpact announced its plans to acquire Triumph Engineering Corp.

April 2011: Genpact acquired Headstrong, a Virginia-based consulting and IT services company

with a specialized focus in financial services, for US$550 Million.

On 15 September 2011, Genpact Acquired EmPower Research, an integrated media and business

research company with strong capabilities in social media research and measurement. EmPower

management has offices based in New York, Bangalore, Cincinnati, New Jersey, San Francisco,

and London.

�55�

�

On April 18, 2012, Genpact announced its move to buy the European business process company

'Accounting Plaza'

On May 14, 2012. Genpact announced that they will acquire Atyati Technologies which is a

technology platform provider for rural banks in India.

Genpact is a global leader in transforming and running business processes and operations

including those that are complex and industry-specific. Genpact stands for Generating Impact –

visible in tighter cost management as well as better management of risk, regulations, and growth

for hundreds of long-term clients including more than 100 of the Fortune Global 500 – and of

those, over 10 of the top 25. Our approach is distinctive: through an unbiased, agile combination

of smarter process science, targeted technology and advanced analytics, we help our clients

become more competitive by making their enterprises more intelligent: adaptive, innovative,

globally effective, and connected to their own clients.

Genpact began in 1997 as a business unit within General Electric – and this heritage has

contributed to our deep understanding of process. As GE made Lean and Six Sigma pervasive,

Genpact applied this same industrial engineering ethos to business processes operations for the

first time in the world.

Built with this single-minded passion for process science and operational excellence, Genpact’s

resulting Smart Enterprise Processes (SEPSM) methodology focused on business impact while

safeguarding costs and limiting initial investment – igniting the global Business Process

Outsourcing (BPO) services industry.

In January 2005, Genpact became an independent company to bring our process expertise and

unique DNA in Lean Six Sigma to clients outside the GE family, and then in August 2007, we

became a publicly-traded company (NYSE: G). We grew rapidly from 32,000 employees, and a

revenue of US$823 million, to the current 60,000+ employees and 2012 revenues of almost US$2

�

billion. Bain Capital became Genpact’s largest shareholder in November 2012 with the strategic

objective to growth of a Company further.

3.14.2 INFOSYS

The following table gives the company’s updated data with its logo.

Type Division

Industry Business Process

Founded 2002

Headquarters Electronic City

Area served Worldwide

Key people

Gautam Thakkar (CEO & MD), Abraham Mathews (CFO),

Anantharaman Radhakrishnan,SVP, Enterprise Services, Raghavendra K

(Vice President and Head

Revenue US$ 583 million (

Employees 24,634 (as of

Website www.infosysbpo.com

Fig: 3.8 Key highlights of Infosys 2013

Infosys is a global leader in consulting, technology and outsourcing solutions. As a proven

partner focused on building tomorrow's enterprise, Infosys enables clients in more than 30

countries to outperform the competition and stay ahead of the innovation curve. With US$7.4bn

in annual revenues and 155,000+ employees, Infosys provides enterprises with strategic

on what lies ahead. We help enterprises transform and thrive in a changing world through

strategic consulting, operational leadership and the co

including those in mobility, sustainability, big data and cloud co

billion. Bain Capital became Genpact’s largest shareholder in November 2012 with the strategic

objective to growth of a Company further.

The following table gives the company’s updated data with its logo.

(Infosys BPO Limited)

Business Process Outsourcing

Electronic City, Bengaluru, India.

Gautam Thakkar (CEO & MD), Abraham Mathews (CFO),

Anantharaman Radhakrishnan,SVP, Enterprise Services, Raghavendra K

(Vice President and Head - HR),

583 million (FY 12-13)(year ending March 31, 2013)

24,634 (as of March 31, 2013)

www.infosysbpo.com

Fig: 3.8 Key highlights of Infosys 2013 (Source: Nasscom)

Infosys is a global leader in consulting, technology and outsourcing solutions. As a proven

on building tomorrow's enterprise, Infosys enables clients in more than 30

countries to outperform the competition and stay ahead of the innovation curve. With US$7.4bn

in annual revenues and 155,000+ employees, Infosys provides enterprises with strategic

on what lies ahead. We help enterprises transform and thrive in a changing world through

strategic consulting, operational leadership and the co-creation of breakthrough solutions,

including those in mobility, sustainability, big data and cloud computing.

�56�

billion. Bain Capital became Genpact’s largest shareholder in November 2012 with the strategic

Gautam Thakkar (CEO & MD), Abraham Mathews (CFO),

Anantharaman Radhakrishnan,SVP, Enterprise Services, Raghavendra K

13)(year ending March 31, 2013)

(Source: Nasscom)

Infosys is a global leader in consulting, technology and outsourcing solutions. As a proven

on building tomorrow's enterprise, Infosys enables clients in more than 30

countries to outperform the competition and stay ahead of the innovation curve. With US$7.4bn

in annual revenues and 155,000+ employees, Infosys provides enterprises with strategic insights

on what lies ahead. We help enterprises transform and thrive in a changing world through

creation of breakthrough solutions,

�5��

�

Infosys BPO Limited (formerly Progeon Limited) is the BPO (Business Process Outsourcing)

subsidiary of Infosys Limited (formerly Infosys Technologies Limited). Infosys BPO closed FY

12-13 with a revenue of US$ 583 million and 24,634 employees in 19 centers worldwide serving

138 clients.

The company was started as Progeon Limited in April 2002 and is today amongst the top BPOs

in India according to NASSCOM. It was started as a 74% and 26% joint venture between Infosys

and Citibank Investments. In 2006 Infosys bought out Citibank's share at a price of Rs. 592 per

share, Citibank having invested at Rs 0.20 per share.

Infosys has 87 global software development centers of which 32 are in India and 55 are outside

India. It has 69 sales offices around the world of which 2 are in India and 67 are outside India.

Infosys BPO operates in India, the Czech Republic, Poland, Mexico, Brazil, USA, China, the

Philippines, Australia and Costa Rica. It has headquarters in Bangalore, India. In India it operates

in Chennai, Gurgaon, Jaipur and Pune .About 60% business of Infosys BPO comes from

overlapping clients with the parent Infosys Ltd.

The Services Business Platforms are Customer Service Outsourcing, Finance and Accounting

Human Resources Outsourcing, Legal Process Outsourcing, Sales and Fulfillment, Sourcing and

procurement Outsourcing, Business Transformation Services and Indian Domestic BPO.

Awards and Recognitions

Infosys BPO won two BPO Excellence Awards 2012 trophies in the BPO Innovation of the Year

and the Operational Excellence & Quality Award categories.

Infosys BPO won two awards under the organizational category – 'Award for Best HR Strategy

in Line with Business' and the 'Diversity Impact Award' at Asia's Best Employer Brand Awards

2012.

Infosys BPO received e-SCM-SP Capability Level 5 Certificate from Carnegie Mellon

University's IT Sqc in 2009.

Acquisitions

• In July 2007, Infosys BPO signed a $28 million deal to acquire finance back-offices of Royal

Philips spread in India, Poland and Thailand.

�

• In December 2009, Infosys BPO

million.

• In January 2012, Infosys BPO acquired Australia

million. Portland Group provides strategic sourcing and category management services.

• In September 2012, Infosys acquired Switzerland

Consultants for about $345 million.

• In December 2003, Infosys had acquired Australia

Information Services for $23 million.

3.14.3 WIPRO

The updated information along with the logo of the company is given below fig:

Type Public company

Traded as BSE: 507685

NSE: WIPRO

NYSE: WIT

BSE SENSEX Constituent

Industry IT services

Founded Amalner, Maharashtra (December 1945)

Headquarters Doddakannelli

Key people Azim Premji

Revenue US$7.95 billion (2013)

Employees 147,281 (June 2013)

Website www.wipro.com

Fig: 3.9 Key highlights of Wipro ltd. 2013

Wipro Limited (formerly Western India Products Limited

an Indian multinational information technology (IT) consulting and outsourcing service company

Infosys BPO acquired Atlanta-based McCamish Systems for about $38

y 2012, Infosys BPO acquired Australia-based Portland Group for about AUD 37

Portland Group provides strategic sourcing and category management services.

In September 2012, Infosys acquired Switzerland-based Lodestone Management

for about $345 million.

In December 2003, Infosys had acquired Australia-based IT service provider Expert

Information Services for $23 million.

The updated information along with the logo of the company is given below fig:

Wipro Limited company

507685

WIPRO

WIT

BSE SENSEX Constituent

IT services, IT consulting

Maharashtra (December 1945)

Doddakannelli, Sarjapur Road,Bangalore, Karnataka, India

Azim Premji (Chairman)

US$7.95 billion (2013)

147,281 (June 2013)

www.wipro.com

Fig: 3.9 Key highlights of Wipro ltd. 2013 (Source: Nasscom)

Western India Products Limited (NYSE: WIT,

information technology (IT) consulting and outsourcing service company

�6��

based McCamish Systems for about $38

based Portland Group for about AUD 37

Portland Group provides strategic sourcing and category management services.

Lodestone Management

based IT service provider Expert

The updated information along with the logo of the company is given below fig:

India.

(Source: Nasscom)

BSE: 507685) is

information technology (IT) consulting and outsourcing service company

�6��

�

located in Bangalore, Karnataka in India. As of March 2013, the company has 145,000

employees serving over 900 clients with a presence in 57 countries.

Wipro Limited is a global provider of comprehensive IT solutions and services, including

Systems Integration, Consulting, Information Systems outsourcing, IT-enabled services, and

R&D services.

It is also a value added reseller of desktops, servers, notebooks, storage products, networking

solutions and packaged software for international brands.

Wipro entered into the technology business in 1981 and has over 140,000 employees and clients

across 54 countries today. IT revenues stood at $ 6.2 billion for the year ended 31 March 2013,

with a repeat business ratio of over 95%.

The business model at Wipro Technologies Ltd is an industry aligned customer facing

model which gives greater understanding of customers’ businesses to build industry specific

solutions.

The company was incorporated on 29 December 1945, in Mumbai by Mohamed Hassam Premji

as Western India Vegetables Products Limited, later abbreviated to Wipro.

During the 1970s and 1980s, the company shifted its focus to new business opportunities in the

IT and computing industry, which was at a nascent stage in India at the time. On 7 June 1977, the

name of the company changed from Western India Vegetable Products Limited., to Wipro

Products Limited.[9]

The year 1980 marked the arrival of Wipro in the IT domain. In 1982, the name was changed

from Wipro Products Limited to Wipro Limited

In 1994 Wipro set up an overseas design centre, Odyssey 21, for undertaking projects and

product developments in advanced technologies for overseas clients. Wipro InfoTech and Wipro

Systems were amalgamated with Wipro in April that year.[14] Five of Wipro's manufacturing and

development facilities secured the ISO 9001 certification during 1994–95. In 1999, Wipro

acquired Wipro Acer. Wipro Super Genius personal computers (PCs) became the only Indian PC

range to obtain the US-based National Software Testing Laboratory's (NSTL) Certification for

Year 2000 (Y2K) compliance.[11]In the same year 2000, Wipro got listed on New York Stock

Exchange.

�6��

�

In February 2002, Wipro became the first software technology and Services Company in India

to be certified for ISO 14001 certification. Wipro also achieved ISO 9000 certification to become

the first software company to get SEI CMM Level 5 in 2002.

As the company grew, a study revealed that Wipro was the fastest wealth creator for 5 years

(1997–2002). The same year witnessed the launch of Wipro’s own laptops with Intel's Centrino

mobile processor. Wipro also entered into an exclusive agreement with the owners of Chandrika

for marketing of their soap in select states in India. It set up a wholly owned subsidiary company

viz. Wipro Consumer Care Limited to manufacture consumer care and lighting products. In 2004

Wipro joined the billion dollar club. It also partnered with Intel for i-shiksha. The year 2006 saw

Wipro acquire c Mango Inc., a US-based technology infrastructure Consulting firm Enabler, and

a Europe. It also entered into a definitive agreement to acquire Oki Techno Centre Singapore Pte

Ltd (OTCS) and signed an R&D partnership contract with Nokia Siemens Networks in Germany.

The year 2008 saw Wipro’s foray into the clean energy business with Wipro Eco Energy. In

April 2011, Wipro signed an agreement with Science Applications International Corporation

(SAIC) for the acquisition of their global oil and gas information technology practice of the

commercial business services business unit. The year 2012 saw Wipro make its 17th acquisition

in IT business when it acquired Australian analytics product firm Promax Applications Group

(PAG) for $35 million.

Wipro is the No. 1 employer of H-1B visa professionals in the United States in 2012. In 2012

Wipro Ltd. announced the demerger of its Consumer Care & Lighting (incl. Furniture business),

Infrastructure Engineering (Hydraulics & Water business), and Medical Diagnostic Product &

Services business into a separate company to be named Wipro Enterprises Ltd. Wipro's scheme

of arrangement for demerger turned effective from 31 March 2013.

�

3.14.4 TATA CONSULTANCY SERVICE (TCS)

The following is the updated information of th

Type Public

Traded as BSE: 532540

NSE: TCS

BSE SENSEX Constituent

CNX Nifty Constitu

Industry IT consulting

Founded 1968

Headquarters Mumbai, Maharashtra, India.

Key people Cyrus Mistry

Natarajan Chandrasekaran

Revenue US$ 11.57 billion (FY 2012

Employees 276,196 (June 2013)

Website www.tcs.com

Fig: 3.10 Key highlights of TATA Consultancy Services. 2013

Tata Consultancy Services Ltd is an information technology (IT) company. The company offers

a range of IT services, outsourcing and business solutions. They also offer IT infrastructure

services, business process outsourcing services, engineering and indus

consulting and asset leveraged solutions.

Tata Consultancy Services Limited

(IT) services, business solutions and consulting company headquartered in

Maharashtra. TCS operates in 44 countries and has 199 branches across the world.

subsidiary of the Tata Group and is listed on the

Exchange of India. Its main function is to provide IT services. TCS is the largest Indian company

3.14.4 TATA CONSULTANCY SERVICE (TCS)

The following is the updated information of the company along with its logo.

532540

BSE SENSEX Constituent

CNX Nifty Constituent

IT consulting(IT Call Centre)

, Maharashtra, India.

Cyrus Mistry (Chairman)

Natarajan Chandrasekaran (CEO & MD)

US$ 11.57 billion (FY 2012-13)

276,196 (June 2013)

www.tcs.com

Fig: 3.10 Key highlights of TATA Consultancy Services. 2013 (Source: Nasscom)

Tata Consultancy Services Ltd is an information technology (IT) company. The company offers

a range of IT services, outsourcing and business solutions. They also offer IT infrastructure

services, business process outsourcing services, engineering and industrial services, global

consulting and asset leveraged solutions.

Tata Consultancy Services Limited (TCS) is an Indian multinational information technology

(IT) services, business solutions and consulting company headquartered in

TCS operates in 44 countries and has 199 branches across the world.

and is listed on the Bombay Stock Exchange and the

ction is to provide IT services. TCS is the largest Indian company

�6��

(Source: Nasscom)

Tata Consultancy Services Ltd is an information technology (IT) company. The company offers

a range of IT services, outsourcing and business solutions. They also offer IT infrastructure

trial services, global

information technology

(IT) services, business solutions and consulting company headquartered in Mumbai,

TCS operates in 44 countries and has 199 branches across the world.[2] It is a

and the National Stock

ction is to provide IT services. TCS is the largest Indian company

�6��

�

by market capitalization and is the largest India-based IT services company by 2013

revenues. TCS has been recognized by Forbes as one of the World's Most Innovative

Companies. TCS ranked 40th overall, making it not only the highest ranked IT services company

to make the list, but also the top Indian company.

Tata Consultancy Services Ltd was incorporated in the year 1968. Tata Sons Ltd established the

company as division to service their electronic data processing (EDP) requirements and provide

management consulting services. In the year 1971, they started their first international

assignment. The company pioneered the global delivery model for IT services with their first

offshore client in 1974. In the year 1981, the company set up India's first IT R&D division, the

Tata Research Design and Development Centre at

Tata Consultancy Services Limited (TCS) was founded in 1968 as a division of Tata Sons

Limited by J R D Tata. Its early contracts included providing punched card services to sister

company TISCO (now Tata Steel), working on an Inter-Branch Reconciliation System for the

Central Bank of India, and providing bureau services to Unit Trust of India.

In 1979, TCS delivered an electronic depository and trading system called SECOM for the Swiss

company SIS SegaInter Settle. TCS followed this up with System X for the Canadian Depository

System and automating the Johannesburg Stock Exchange. TCS associated with a Swiss partner,

TKS Teknosoft, which it later acquired.

In 1981, TCS established India's first dedicated software research and development centre, the

Tata Research Development and Design Centre (TRDDC) in Pune. In 1985 TCS established

India's first client-dedicated offshore development centre, set up for client Tandem.In the early

1990s the Indian IT outsourcing industry grew rapidly due to the Y2K bug and the launch of a

unified European currency, Euro. TCS created the factory model for Y2K conversion and

developed software tools which automated the conversion process and enabled third-party

developer and client implementation.

By 2004, TCS's e-business activities were generating over US$500 million in annual revenues.

On 25 August 2004, TCS became a publicly listed company.

�

In 2005, TCS became the fi

the bioinformatics market.

In 2006, TCS designed an ERP

Corporation.

In 2008, TCS undertook an internal restructuring exercise which aimed to increase the

company's agility.

TCS entered the small and medium enterprises

based offerings. On the last trading day of 2011, TCS overtook RIL to achieve the highest

market capitalisation of any India

In the 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for the first

time.

In May 2013, TCS bagged a Six-

TCS and its subsidiaries provide a range of information technology

services including application development, business process outsourcing, capacity planning,

consulting, enterprise software, hardware sizing, payment processing, software management and

technology education services.

Its established software products are

Service lines

TCS' services are currently organized into the following service lines (percentage of total TCS

revenues in the 2012-13 fiscal year generated by each respective service line is shown in

parentheses):

• Application development and maintenance (42.80%);

• Asset leverage solutions (2.70%);

• Assurance services (7.70%);

• Business process outsourcing (12.50%);

• Consulting (3.00%);

• Engineering and Industrial services (4.60%);

In 2005, TCS became the first India-based IT services company to enter

ERP system for the Indian Railway Catering and Tourism

rtook an internal restructuring exercise which aimed to increase the

small and medium enterprises market for the first time in 2011, with

based offerings. On the last trading day of 2011, TCS overtook RIL to achieve the highest

market capitalisation of any India-based company.

e 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for the first

-Year contract from DoP worth over 1100 crores.

TCS and its subsidiaries provide a range of information technology-related produc

services including application development, business process outsourcing, capacity planning,

consulting, enterprise software, hardware sizing, payment processing, software management and

cts are TCS BaNCS and TCS MasterCraft.

organized into the following service lines (percentage of total TCS

13 fiscal year generated by each respective service line is shown in

Application development and maintenance (42.80%);

Asset leverage solutions (2.70%);

Business process outsourcing (12.50%);

Engineering and Industrial services (4.60%);

�6��

based IT services company to enter

Indian Railway Catering and Tourism

rtook an internal restructuring exercise which aimed to increase the

irst time in 2011, with cloud-

based offerings. On the last trading day of 2011, TCS overtook RIL to achieve the highest

e 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for the first

1100 crores.

related products and

services including application development, business process outsourcing, capacity planning,

consulting, enterprise software, hardware sizing, payment processing, software management and

organized into the following service lines (percentage of total TCS

13 fiscal year generated by each respective service line is shown in

�64�

�

• Enterprise solutions (15.20%);

• IT infrastructure services (11.50%);

The Tata consultancy services campus at Lucknow, utter Pradesh.

India: TCS has development centres and/or regional offices in the following Indian

cities: Ahmedabad,Mangalore, Bangalore, Baroda, Bhubaneswar, Chennai,Coimbatore, Delhi, G

andhinagar, Goa, Gurgaon, Guwahati, Hyderabad, Jamshedpur, Kochi, Kolkata, Lucknow, Mum

bai, Nagpur, Indore, Noida, Pune,Chandigarhand Trivandrum.

ABROAD: TCS has offices at Africa, Asia, Australia, Europe, North America and South

America.

TCS BPS

TCS BPO recently named as BPS is the second largest player in the outsourcing industry in India

behind Genpact according to NASSCOM rankings for the year 2011-12. The BPO division had

revenues of US$ 1.44 billion in the FY 2012-13 which was 12.5% of the total revenue of

TCS. TCS BPO has more than 45,000 employees which serve over 225 customers across 11

countries. The rate of attrition in BPO division during the financial year 2012-13 was 19.5%.

Other than major Indian cities, TCS BPO is also present in Tier-II locations like Pune. TCS is

also expanding its BPO centre in Kolkata, where it already employs 2,000 people Tata

Consultancy Services has opened a business process outsourcing facility in the Philippines

following the path of India-based BPO companies which have operations in that country.

TCS is one of the largest private sector employers in India, and the second-largest employer

among listed Indian companies (after Coal India Limited).

TCS had a total of 276,196 employees as of March 2013, of which 31% were women. The

number of non-Indian nationals was 21,282 as at March 31, 2013 (7.7%). The employee costs for

the FY 2012-13 were US$ 4.38 billion, which was approx. 38% of the total revenue of the

company for that period. In the fiscal year 2012-13, TCS recruited a total of 69,728 new staff, of

whom 59,276 were based in India and 10,452 were based in the rest of the world. In the same

period, the rate of attrition was 10.6%. The average age of a TCS employee is 28 years. The

employee utilization rate, excluding trainees, for the FY 2012-13 was 82%.

�65�

�

TCS was the fifth-largest United States visa recipient in 2008 (after Infosys, CTS, Wipro and

Mahindra Satyam). In 2012, the Tata group companies, including TCS, were the second largest

recipient of H-1B visas.

Subramanian Ramadorai, former CEO of TCS, has written an autobiographical book about his

experiences in the company called The TCS Story...and Beyond.

Awards and recognition

• TCS was awarded the Business Standard's Company of the Year award for 2012.

• In 2012, the company won Gold Shield award for excellence in financial reporting from

the Institute of Chartered Accountants of India (ICAI).

• The company won 'Recruiting and Staffing Industry Leader of the Year' and ‘Best

Employer Brand’ awards at the World

The ITES industry in India should strengthen its position in the outsourcing business by

escalation in the area of its domain knowledge and becoming much more focused in terms of the

services offered. Its sole objective is to go up along the worthy chain of accomplishment without

limiting itself to the low-skilled jobs. There is an unremitting struggle to sustain its point of

competitive benefit over the other countries in the scrimmage, in terms of quality human

resources, low costs, and favorable business environment. It is to be comprehended that in the

Indian BPO Industry unhealthy practices can impinge on its competiveness in the arena of global

BPO industries and consequently curtail such practices. The international business world is

putting an eye on India as a hot destination for business process outsourcing and the Indian

Industry is trying to bring a new insurgent with a BPO hub in the world.

REFERENCES

Chapter III

1. Gary Hamel and CK Prahalad (2002), Competing for the Future, Tata McGraw Hill"

2. Johnsi S. and N. Nirmala Devi (2004), 'BPO in India and US - An overview', Business Process

Outsourcing-Concept, Current Trends,Management, Future Challenges, Deep & Deep Publications

Ltd. pp-73-77.

3. Kavitha , H. Susan Abraham and R. Nirmala (2004), 'Fast Developing World of Business

Process Outsourcing', Business Process Outsourcing-Concept, Current Trends, Management,

Future Challenges, Deep & Deep Publications /Ltd.,pp-44-50

4. Miciak, Alan and Desmanais, Mike (2001) Benchmarking service quality performance at

business – to – consumer call centres, journal of Business & Industry Marketing, Vol 16 No 5, pp

340-453"

5. Cariner, S (1998) Key Management Ideas,3rd Edition, F T Prentice Hall, London,"

6. Reuters 2001: The Future or European Call Centres: From Telephony to Multimedia

7. Review, Vol. 7, 1982, pp, 413-41.

8. Marr, B and Schiuma, G (2001), ‘Measuring and Managing Intellectual Capital and Knowledge

Assets in new Economy Organization’, in Bourne, M (ed), Handbook of Performance Measurement,

Gee, London"

9. Houlihan,M (2001), Managing to manage? Stories from the call centre floor, Journal of

European Industrial Training, 25(2), 112-113"

10. Rademeyer, D (1995) A benefits model for the call centre strategy Johannesburg: Rand

Afrikaans University"

11. Dawson, K (1997) The role of the call centre Retrieved October, 2001, from

http://wwwrealmarketcom"

12. Prabhakar, P R Sheehan, M J & Coppett, J I (1997) The power of technology in business selling

call centres MCB Journal of Business and Industrial Marketing, 12(3), 1-10"

13. Burgers, A, De Ruter, K, Keen C & Streukens, S (2000) Customer expectation dimensions of

voice-to-voice service encounters A scale development study International Journal of service

Industry Management, 11(2), 112-113"

14. Michell, PJ (1998) Aligning customer call centres for 2001, Telemarketing & Call Centre

Solution, Vol 1 No 10, pp 64-69"

15. Acey, John (2002) Is your call centre predictive?, Management Services, Feb, pp 20-21"

16. Ruben, BD (1983) A system theoretic view, intercultural community theory, current perspectives

London sage"

17. Senge PM (1990), the fifth discipline: the art and practice fo the learning organization, New

York: Doubleday/currency"

18. Miller, J G & Miller, J L (1992), Cybernetics, general systems and living systems theory In RL

Levine, & HE Fitzgerald, (Eds), Analysis of dynamic psychological systems Volume I Basic

Approaches to general systems, dynamic systems and cybernetics New York.

19. Vetere, A & Gale, A (1987), Ecological studies of family life, chichster, John Wiley & Sons"

20. Miller, Z (1999) Learning that works Retrieved January 2000, from

http://wwwachieveglobalcom"

21. Burns, J (1995) Developing and implementing a customer contact strategy MCB Managing

service Quality, 5(4), 960-974"

22. Burgers, A, De Ruter, K, Keen C & Streukens, S (2000) Customer expectation dimensions of

voice-to-voice service encounters A scale development study International Journal of service

Industry Management, 11(2), 112-113"

23. Stauss, B & Mang P (1999) Cultural shock in inter-culturalf service encounters Journal of

services marketing, 13(4),329-346"

24. Neely, A, Adams, C and Kennerley, M (2002), The Performance Prism: The Scorecard for and

its implications for future research, journal of marketing, Vol 49, Fall pp 41

25. Miciak, Alan and Desmanais, Mike (2001) Benchmarking service quality performance at

business – to – consumer call centres, journal of Business & Industry Marketing, Vol 16 No 5, pp

340-453"

26. Gilmore, A and Moreland, L (2000) Call centres; how can service quality be managed?, Irish

Marketing Review, volume 13 No1, PP3-11"

27. Tom, G, Burns, M and Zeng, Y (1997) Your life on hold; the effect of telephone waiting time on

customer perception, journal of Direct Marketing, Vol 11 No 3, pp 25-11"

28. Feinberg, RA Kim, I-S Hokoma, L (2000) International Journal of Service Industry

Management, Vol 11 No2, pp 131-141"

29. Black G (1998) Survey-FT Telecoms 98, The Financial Times, 17 March, P10"

30. Delorey, E (2003) Correlating ICR Performance and Customer Satisfaction, Call Centre

Magazine, Feb, pp13"

31. Ziethaml, V A and Bitner, M J (2000) services Marketing, MC Graw – Hill, Boston, MA"

32. Heskett, J L, Sasser, W E and Schlesinger, L A (1997), The Service Profit Chain: How Leading

Companies Link Profit and Growth to Loyalty, Satisfaction, and Value, Simon & Schuster Inc,

NewYork"

33. Rucci, A J, Kirn, S P and Quinn, R T (1998), The Employee – Customer – Customer Profit

Chain at Sears Harvard Business Review, Vol 76 No1pp 82-98"

34. Heskett, J L Sasser, W E and Schlesinger, L A (2003), the value profit Chain: Treat Employees

Like Customers and Customers Like Employees, Free Press, New York"

35. Calk, J T (1998) Cyber service giving customers what they want-only better, Call Centre

Association (1999) Website, http//wwwccaorguk"

36. Jones, T O and Sasser, E (1995) why satisfied customers defect, Harvard Business Review,

November/December, pp88-99"

37. Delorey, E (2003) Correlating ICR Performance and Customer Satisfaction, Call Centre

Magazine, Feb, pp13"

38. Driver, C and Johnston, R (1998) The influence of Customer Contact on Perceived Service

quality and productivity, in Coughlan, P, Drangole, T, Peppard, J (Eds), Operations Management:

Future issues and competitive Responses, University of Dublin, Dublin"

39. Klaus, P G (1985) quality epiphenomenon: the conceptual understanding of quality in face – to –

face service encounters, in Czepiel, JA Soloman, M R and Surprenant, C F (Eds) The service

Encounter, Lexington Books, Lexington MA"

40. Bearden, W O Malhotra, M K, Uscategui, K H (1998) Customer contact and evaluation of

service experiencies:Propositions and implications for the design of services, Psychology and

Marketing, Vol 15 No 8"

41. Wallace, C M, Eagelson, G and Waldersee, R (2000) the Sacrificial HR Strategy in call centres

international Journal of Service Industry Management, Vol 11 No 2, pp 174-184"

42. Bowen, D E and Lawler, EE (1992) The empowerment of service workers What, why, how and

when sloan management review Vol 33, pp 31-39"

43. Bennington, L and Cummane, J (1998) Customer satisfaction, Loyalty and public services, in

proceedings: EISM 8th Workshop on Quality Management in Services, Ingolstadt, Germany, pp

429-452"

44. Cohead, K (1995) Psychology in call centres Retrieved July, 2001, from

http://wwwsatelelinkcom/peoplehtm"

45. Peter, D (2001), Band Aid does not fix stress in call centres Retrieved July 2001, from http://

wwwsatelelinkcom/peoplehtm"

46. White, C & Rons V (2005), Core competencies of a call centre agent southAfrican Journal of

Human Resource Management,3,(2)"

47. Bateson, G (1972), Steps to an ecology of mind New York, Ballantine Books"

48. Senge PM (1990), the fifth discipline: the art and practice fo the learning organization, New

York: Doubleday/currency"

49. Bennington, L, Cummane, J & Conn P (2000) Customer satisfaction and call centres: An

Australian Study International Journal of Service Industry Management, 11(2), 162-173"

50. Freeman, B & Rustnell, D (2000) Selection advantage assessment results and observations

Kingston call centre expo Retrieved October, 2002, from http://businesskingstoncanadacom/Expo-

KaplanReportpdf"

51. Spencer, L M & Spencer, S M (1993), Competence at work: models for superior performance

New York John Wiley & Sons"

52. Boshoff, C (1999) RECOVSAT: An Instrument to measure satisfaction with transaction-specific

service recovery, Journal of Service Research, 1(3), 236-249"

53. Career Services (2001), Retrieved August, 2002, from

wwwiscgovuk/news_docs/youthsurveypdf"

54. Lorimer, I (1999), Targeting Skills, Call craft, Retrieved January, 2003, from

http://2091302020/now/MANAGE/people/targetinghtm"

55. Jones, MA & Jaebeom, FS (1997), Transaction – specific satisfaction and overall satisfaction an

empirical analysis Journal of Services Marketing, 14(2), 147-159"

56. Bateson, G (1972), Steps to an ecology of mind New York, Ballantine Books"

57. Service Center Roles& Responsibilities Review, (2002),

58. Ford, DH & Lerner, RM (1992) Developmental systems theory: An integrative approach

Newbury Park:Sage"

59. Levine, RL & Fitzgerald, HE (Eds) (1992) Analysis of dynamic psychological systems Volume

1, Basic Approaches to general systems, dynamic systems and cybernetics New York Plenum Press"

60. Senge PM (1990), the fifth discipline: the art and practice fo the learning organization, New

York: Doubleday/currency"

61. Barnhart,R (2000) What is a Competency? COMPET Consulting, Retrived October, 2002, from

http://wwwcompetiniccom"

62. Freeman, B & Rustnell, D (2000) Selection advantage assessment results and observations

Kingston call centre expo Retrieved October, 2002, from http://businesskingstoncanadacom/Expo-

KaplanReportpdf"

63. Wallace, C M, Eagelson, G and Waldersee, R (2000) the Sacrificial HR Strategy in call centres

international Journal of Service Industry Management, Vol 11 No 2, pp 174-184"

64. Bowen, D E and Lawler, EE (1992) The empowerment of service workers What, why, how and

when sloan management review Vol 33, pp 31-39"

65. Jeffrey R. Edwards, “ A Cybernetic Theory of Stress, Coping and Well-Being in Organizations,”

Academy of Management Review, April 1992, pp. 238-274.

66. Frenkel, S J, Tam, M, Korcynski, M and Shire, K (1998) Beyond Bureaucracy? Work

Organization in Call Centres, International Journal of Human Resource Managemen

67. Halpin, A W and winner, B J (1957) factorial study of the Leader Behaviour descriptions,

Stogdill, R M and Coons A E (Eds), Leader Behaviour; Its description and measurement, research

monograph number 88, Bureau of Business Research, Ohio State University,

68. Yin, R K and Campbell, D T (1994), Case Study Research Design and Methods, Sage,

Thousand Oak.

69. Cariner, S (1998) Key Management Ideas,3rd Edition, F T Prentice Hall, London,"