ITES-BPO Summit-2006

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kiran--dayanidhi

 

 

The focus of the recent NASSCOMS's 9th ITES-BPO Summit-2006 in Bangalore was ‘How the industry can emerge as the benchmark in global outsourcing and continue the package of benefits to overseas investors'. Excerpts of opening speeches

Kiran Karnik, President, NASSCOM

 

The ITES-BPO segment has registered very strong growth. Exports last year ending March 31st were US$6.3 billion. It is a milestone for an industry as young as it is today and in many ways exemplifies how fast the industry is growing; it has reached the stage of near adulthood.

 

Last year over 100,000 people were added to the ITES-BPO industry alone. And I think that's a substantial job driver, good for the country, shows significant growth in the industry itself. Every time you walk into a company and see the number of young bright faces raring to go; it gives you great confidence.

 

At the same time the pie is very large, therefore one of the things would be to focus strongly on -Are there supply side constraints that are going to hold us up?  The NASSCOM Assessment and Certification program - (NAC) aims at generating and creating talent. We define the skill sets that this industry needs and get them to learn the skill sets either by themselves or by going to training courses. We've had a very successful pilot and we are all set to get into the operational phase.

 

We have also looked at smaller towns that this industry can go to. Reasons being - 1st- Tapping into new human resources. 2nd is reducing your cost base as you move out to small cities.  3rd, to make this happen, we have been working very closely with the state governments to ensure that these new destinations have the kind of infrastructure that will support systems that the industry needs. An area of some long term importance is the duration of the STPI, scheme. We've been working closely with the government to make sure that we continue to get the benefits keeping in mind that this industry is a huge employment creator and needs to be looked at in special ways.

 

Trust is critical to build a true partnership which will last for the next ten years.

 

 

The self regulatory organization - SRO in the long term can position India in a very unique way. Those companies that are a part of the SRO would be following certain best practices which will give the customers confidence.

 

Next how do we improve the efficiency of this industry? This is critical because we know that other costs are bound to go up and we've so far been very successful in setting them off by reduction in things like telecom, by increasing our efficiency and I think we need to look at how do we continue to ensure that we stay ahead of the curve in terms of increasing operational efficiency and giving best value to customers. The employee registry is very important in terms of building confidence in our customers and protecting the individual employee. A large number of companies have signed up, both from IT and BPO industry.

 

The Self regulatory organization in the long term can position India in a very unique way.

 

 

NASSCOM will continue its initiatives in working with educational institutions in areas of crucial importance. One is language teaching and the second is computer skills. We've also talked of soft skills.

 

Promod Bhasin, Chairperson, NASSCOM ITES-BPO Forum initiatives

 

It's remarkable growth for an industry that's growing up. We already employ nearly half a million people and give employment to another 4 or 5 times that number indirectly in the ancillary services.

 

The industry in so many ways represents what I think of as the new India. The faces of our employees, young, energetic, vibrant, passionate, committed represent what this country can become. The other benefit of these youngsters is the fact that they spend money, and I believe they are the enormous power which is propelling India's growth driven by consumption.

 

Demand from the world for our products and services remains very high. I believe we are limited only by our own imagination and ability to execute in terms of where we can go, how fast we can hire and train, how fast we can integrate people.

 

Global competitors are coming into the country, they are setting up shop and frankly many of them are growing much faster than the local companies. It gives us credibility, it gives us the intelligence to learn from others and it draws investment dollars into areas that India so badly needs.

 

I see new avenues for opportunity. You can think of engineering, you can think of analytics, knowledge based work, research, design, architectural work, publishing, media.  We have enough entrepreneurs, global natives, and global companies within the country who are all willing to jump onto the opportunities. This is going to grow at an even more furious pace   in the future than it has in the past.

 

Customers and suppliers are both getting more mature.   Both are learning how to deliver services, how to do professional work, how to ensure you get the quality you need and the cost benefits of what we promise are truly delivered.

 

All around the world, other countries are recognizing that this is a profitable way to increase jobs and employment in their country. They are all competing for this business, with incentives, with infrastructure, technology, a marketing program that will rival ours.  At the same time, we must not be sanguine about the politics of our business and of our industry.

 

Competition is changing and with it the game is changing.

 

 

We have to change the debate. It's not just about jobs moving offshore. It has to be about efficiency, productivity, creating value for our customers, making them stronger.  We have to use the examples of the IT companies, whereby most of their customers have become the strongest over a period of time. We must also not take it for granted that business will come
our way.

 

The employee registry builds confidence in our customers and protects the individual employee.

 

 

Along with that there are some other key issues that are within our grasp, or of our government and our industry - Human resources, infrastructure, law and order, legal reform and the entire process of education. China has said that they want to build 50 Harvard universities, if they build half of that, think of what that will do to global competitors. We still have our IIM's and IIT's and they have to remain at the same level for another twenty years. We don't need two more institutes or five more institutes, we need a hundred. We don't need 10,000 more graduates, we need a 100,000. Industry stands ready to work with government on the education initiative.

 

Today, on the infrastructure side our industry has to generate its own power, transport its own employees to work, provide the security. Is that fair? Think of the cost that adds to our industry.

 

State governments have been extraordinarily helpful in many areas. I'd urge them that the speed and urgency within which they are enacting and working on the real issues of freeing education so that it can serve the purpose; which is to build people who can really get employment when they come out of schools and colleges.

 

What is the future? Full of hope and optimism and great demand. At the end, we provide a very compelling economic model. We deliver productivity, global delivery capability and are changing, I hope in some small way the definition of core competence for industry. What is being redefined is what companies want to do themselves, of what they are perfectly capable, of what they have to give to somebody else to execute. I hope over time it will change the way companies behave and industries actually compete.

 

But competition is changing and with that the game is changing. And this will continue to change over the next three or fours years rapidly and everybody will have to redefine what exactly are the key elements.

 

Ten years from now the companies that will survive are those that have built the domain expertise in a niche, built it on a foundation of technology and process that is sustainable at a level of productivity that doesn't take us out of the game ten years from now. How you manage threats and other issue will give our customers confidence in what we do.

 

We must also be known for outstanding governance and transparency. When you are dealing with a supplier 6000 miles away, trust is critical to build a true partnership which will last for the next ten years.

 

I've rarely seen an industry so well poised to take advantage of the future. More and more global companies are coming into the market everyday and the enquiries that they are coming up with are changing from what was very simple earlier to much higher value processes.

 

I see innovation, I see creativity happening amongst many companies that are driving operational excellence to completely new levels in India today. I am filled with hope, enthusiasm and optimism that are tinged with caution and concern - if we don't get our education system moving a lot faster, this huge intellectual talent that we should be using as our strongest point will not remain our strongest point. There is no issue on the number of people in India. The issue is - Are they adequately trained?

 

Tarachand Wanvari, a consulting correspondent for Business Gyan looks after the South India Desk of indiantelevision.com. Feedback at tarachand@businessgyan.com

 

 Issue BG64 July06

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