Call Centers News

AT&T Decides To Bring Broadband Call Center Back Onshore AT&T will be returning approximately 2,000 call center jobs to the US, as the company has decided to shutter an Indian call center that handles tech support calls for the telecom’s broadband service.

AT&T cited cost as the primary reason for bringing the jobs back to the US, saying that an agreement with the Communications Workers of America on salary and benefits make having the call center employees on its staff feasible. “We’re pleased that the Communications Workers of America has recognized the mutual importance of creating these jobs with competitive wages and benefits that enhance the company’s ability to compete while creating good jobs,” said Bill Blase, AT&T executive vice president for Labor Relations. Is it really all about AT&T suddenly deciding that a US call center would be cost competitive with India, or are there other factors at work here?

India has been a popular destination for tech-related jobs in the US due in no small part to the large population of English-speaking workers in that country who are also technically proficient. Companies have also been increasingly willing to offshore call centers, which occasionally causes a backlash with their customers. Dell decided to stop routing tech support calls for some of its corporate products to India after complaints from their business customers.

At the time, a Dell spokesperson said that the company’s customers were telling them that they “didn’t like the level of support they were getting” from its Indian call center. Other companies are rethinking their offshore call centers as well. In June, Apple cancelled plans for a large call center in Bangalore, deciding instead to keep the operations in the US. Looking at the larger picture, India still has a relatively inexpensive labor market compared to the US, along with a large number of competent call-center workers.

Companies which value cost-control above all else may be inclined to keep their call centers in india. But if customers complain about a lack of competency and poor support, some companies will likely reevaluate their strategies.

The Communications Workers of America, the union representing AT&T’s call center workers in the US, is choosing not to play the competency card. It is instead calling the agreement with AT&T “a terrific achievement” that “reverses the flow of work from contractors back to our bargaining units” with “superior” wages and benefits.

Resource Page : Ars Technic

The rural area have lot of potential for the growth of the call centers. Now the call center companies are focusing and setting up the business in the rural area. In India the rural area are more then the metro cities and big town. The talent and the laborious people are hidden in the rural area’s. Now the call center companies are given the priority for the business from rural area. The reasons are these first the cost factor and the motivated people are present in these area. Lot’s of long term education and employment plans are running in rural area with the full support Indian government to do the development and to make the rural area more stronger then cities. Even the call center sector is heading towards the rural areas to set up operations.

          As we know that Indian companies have been setting up call centers in various countries including Sri Lanka, Vietnam, China, and Thailand. However, the biggest unexplored market is here. The future growth for the Indian call center industry is within the country. call center firms head towards the rural areas especially for processes like data entry in order to tide over infrastructure and hiring costs.

“Indian companies have been setting up call centers in various countries including Sri Lanka, Vietnam, China, and Thailand. However, the biggest unexplored market is here. The future destination for the Indian call center industry is within the country,” he said.

“The first national rural call center conference organized by Byrraju Foundation, the NGO arm of Satyam Computer Services, in Hyderabad, Karnik said Indian call center companies are moving slowly towards rural areas.”

The heart of the India is reciting in the villages or in the rural area. This is the main reason that Indian IT and call center facilities are being set up in the rural area’s very soon. It is sure that setting up the call center in rural area is always beneficial in terms of cost saving and the infrastructure.

Smaller call centers operating in the country are not only faced with the challenge of finding enough skilled people to work for them. They are also struggling to keep their people from leaving and joining bigger call centers. Call Center agents quit the job when they get good offer from bigger call centers on big projects. Very few agent will continue in the small call center for long time.

It is essential for the small call center’s to take good care and  giving them benefits such as housing, food, pick up / drop. Small Call Center must have good policy to attract the agents so that they should not quit soon. The small call centers which have 50 agents only can also survive better if the policies are good and in favor of the agents and companies growth.

But in the recent months, on average basis seven small call center members have folded and four have diversified into other information technology-related business. Small call center companies need to invest a good amount of money to survive for three months. That amount will allow for 50 seats. Smaller call centers also have access to training and capacity-building so it very important to take quarterly trainings with all agents.

One point which we can always remember that all big call centers were also the small in the starting  time but by making an effort and giving the good customer satisfaction with caring of agents small call center can also be the big one. In India there are lot of small contact center and giving the best performance in terms of higher client expectation.  If agents feel good and get all the company’s benefits then he may start thinking to stay back with company as a key player.

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The BPO deal space for acquisitions is looking hot again after a lull for over the last six months. The US slowdown is pushing more third-party outsourcing firms and captive operations to sell out, according to industry players and investment bankers.

Compared to the last quarter when both potential targets and buyers were in a wait-and-watch mode, large third-party BPO firms and integrated IT and BPO players are now keen on using their cash reserves to gain scale and new service lines, while potential targets that were holding out hoping for a recovery in their valuations are now interested in exiting before further value erosion happens

Many of the smaller players which are unable to scale up are now looking to sell out. Some of the investors in these companies were planning to exit through IPOs but given the market conditions they cannot go IPO now. Many multinationals with captive back office operations of less than 5,000 people are also in the market,” said one large IT and BPO player.

Two quarters ago, the firm, which had also participated in the initial round of bidding, was hesitant to make any acquisitions because the prevailing valuations were too high. “Since then, valuations have come down by about 15%. We are actively looking at many deals,” a senior executive with the firm said.

“Firms that were valued at 2.5 times their revenues are now seeing their valuations at 1.5 times their revenues. We also see multinationals doing carve-outs of some of their functions,” said Milan Sheth, partner, Ernst & Young. The recent acquisition of RSM McGladrey’s captive operations by Quatrro BPO is one such instance of a third party BPO acquiring the captive unit of a US company hit by mortgage woes.

RSM McGladrey’s parent, H&R Block, was hurt by troubles to its mortgage arm, Option One, and only recently managed to conclude its sale to Willbur Ross after an earlier attempt to sell it to Cerebrus Capital Management failed. Option One, which also had a captive operation in Pune, has now nearly shut down. The captive used to employ close to 800 people at one time, said a former employee. The number had dwindled to 300 and has now reportedly closed. Option One in the US had also laid off 600 employees globally.

“Because of the recession, some of the sell-off decisions have been advanced. Unless you’ve made significant investments in the captive, you won’t be able to make them profitable. And people are shy of making investments now,” said Abizer Diwanji, executive director, KPMG.

“Companies in the US are not willing to bear fixed costs on their balance sheet,” said Rajesh Jain, his colleague who handles BPO transactions.

“We’re getting at least one deal a day. Many of them are captives based in India and some of them are third-party BPO firms in the US,” said one BPO executive who did not want to be named. Even BPO firms, which haven’t been very aggressive with acquisitions, are now drawing up fairly aggressive acquisition-led growth plans.

The Nasdaq-listed EXL Services, for instance, has so far done only small acquisition of the KPO firm, Inductis, unlike its peers WNS Global Services and Firstsource Solutions that have done multiple acquisitions. The firm, which has $ 102 million cash on its books, is now learnt to be looking for an acquisition of a similar size and also open to cash-cum-stock deals.

Source: The Economics Times

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A growing domestic market and the rising rupee have triggered IT companies to increase their focus on the Indian market.This will be a huge opportunity for Indian BPOs and IT companies which already have some of America’s top banks as clients. The report also suggests that the IT spends in the Indian market are rising, offering strong opportunities for various service providers. The US sub prime mortgage crisis has not visibly impacted India yet. Indian IT firms are unlikely to be hit by the US sub-prime lending crisis as their exposure to clients in the mortgage sector is limited.

IT and BPO companies are now focusing their eyes on job referrals by their employees with a twin-aim to retain the existing workforce and expand it as well. Employees have emerged as the key asset for companies engaged in the information technology and related services. But, frequent job-hopping and a high attrition rate have become a key deterrent for this growth story, even as the entire talent pool is getting smaller compared to the high growth rates coming their way.

IT vendors, who till recently preferred to earn in dollars are now looking at opportunities in the domestic market. And what’s driving their interest is the unprecedented boom in telecoms, banking, financial services and insurance sectors. Suddenly, these areas have become attractive for Indian IT vendors.

Quoting industry estimates, Goel’s report says IT spending in India is set to grow the fastest in the world in 2008. “As the information & communications technology market in Asia-Pacific reaches $154 billion in 2008, India and China will contribute half of the total spend. Over the next three years, the Indian market will nearly triple in size, becoming a $71 bn market by 2012.”

Companies in the automotive, manufacturing, and high-tech industries are more aggressively outsourcing their back-office information technology outsourcing(IT) and business processes outsourcing in order to reduce costs and improve their performance. Around 67 percent of companies surveyed in these industries identified cost reductions as the key means of measuring outsourcing success. Measuring customer satisfaction levels ranked second, cited by 46 percent of respondents, with improved process performance levels coming in third at 31 percent.

“As outsourcing becomes more pervasive and encompasses more back-office support as well as critical functional areas, outsourcing service providers will more closely resemble a critical member of a manufacturer’s supply chain rather than a traditional third-party support organization,” Lepeak predicted. He added that buyers will see a broader array of service provider options, but the number of service providers able to deliver large multi-function deals across multiple geographies will still be limited.

After establishing their position as the leader in the global BPO arena, Indian ITeS (IT-enabled services) firms are now eying their own backyard to expand businesses.

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India is growing in the BPO sector at present India is unquestionably the BPO superpower of the world. But it is also true that the competition is always on. There are other strong competitors of India who might ruin India’s BPO. There are lot of countries and one which on top is China.

China is one such country which can eat into the BPO share market of India. But for the time being India is well ahead of China because of some inherent advantages. India is currently booming in the BPO arena and has scored over China to emerge as the top offshore destination for Global businesses. In the 2004 offshore index, India remains the star performer. It has once again captured the top spot in outsourcing by a comfortable margin due to its strong mix of low costs and noteworthy depth in human resources. This fact was brought out in a study conducted by AT Kearney, an international consultancy agency.

India has a very important advantage, their command of the English language. There are lots more Indians with good English skills than Chinese. Forrester also endorses the view that scalability of resources (talent pool) is the major factor that makes India an attractive offshore location. “The cost of operations in India can be 20-30% higher than places like Vietnam or lower than places like Brazil. But part of the challenge for these countries is the lack of skills. There is a very limited set of low-end work that companies like GE are looking at and lack of quality resources makes it hard for these countries to get started. The work going offshore today is geometrically more complex than the Y2K work that India got started on with,’’ says Mr McCarthy.

India proved better than China on account of several factors. The study pointed out that China lags behind India in terms experience and other important factors like IT and management education, language skills, concerns about intellectual property and overall country risk.

According to the study, although India and China are the market leaders in this sector, there are huge opportunities present in the market to give ample space to other countries like Philippines, Vietnam, Romania, Kenya, Sri Lanka and North America market to grow.   

The study also said although it is unlikely that India would be able to retain its number one slot with China aggressively trying to outstrip it in the business, it would still be able to get a decent share of the pie.

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