Business Process Outsourcing India

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With around 0.7 million people employed in the outsourcing sector in India, contributing annual revenues of $11 billion in the year 2008, business process outsourcing India is at its pinnacle at present. Fostering mainly to western functioning of multinational corporations (MNCs), business process outsourcing India refers to the utilities of outsourcing industry in India.

Emergence of BPO industry in India

BPO industry in India came into existence due to advanced telecommunication, minimum restrictions on international trade pacts and IT efficiency over the past decade. These factors led to a crossroad where firms worldwide increasingly connected with each other. A severe competition globally sprung up compelling the business managers across the world to discover ways to minimize cost of regulating business and utilizing resources to satisfy the need of markets globally. The re-allocation of business strategies to influence advantages of outsourcing and paying attention to core proficiencies is now the key approach followed by major firms worldwide.

BPO service-suppliers are supposed to offer a wide gamut of benefits to their patrons varying from possessing greater capability in outsourced functions, lesser costs realized via economies of balance and the aptitude to attract multiplicity of loads.

The financial services sector, in context of vertical input, adds approximately 17% of the total market size. This is followed by Telecom industry (16%), Consumer Goods and Services (15%), Manufacturing (9%) and the remaining by the Information Technology sector.

The BPO sector can be roughly divided into three areas of functional processes -
  • Business administration
  • Supply chain management
  • Sales, marketing and customer care.

Landmarks achieved by Business Process Outsourcing India


By providing the best blend of cost, scalability and excellence, India has surfaced as one of the best performing nation in the global Business Process Outsourcing market. With revenues of around $3.9 billion in the fiscal year 2003-04, the appreciation rates of Indian BPO sector have been 59%, 45.3% and 44.4% in the fiscal years 2002-03, 03-04 and 04-05. The revenue is likely to reach $5.7 bn in 2004-05.

India as the preferred off shoring location in the world


In spite of the availability of increasing off shoring location alternatives, India has appeared as one of the most favored setting for outsourcing. A national level estimation of people and cost effectiveness suggests that India possess larger toehold mainly due to accessibility of sufficiently skilled manpower of over 350,000 well-qualified and English speaking engineers. The current outsourcers see it as more constructive than other low-cost nations such as Brazil, China, Hungary and Philippines.

In India, around 2.5 million people successfully complete their graduation every year. Due to dearth of skill, compensations are elevating by 10-15 percent. As per the market evaluation firm Gartner, the sector extended upto $310 bn by the end of fiscal year 08.

The cost benefits of offshoring in India are considerable. As compared to US$ 19,000 in the United States, it costs less than US$ 7,500 per year to appoint a call centre agent. Moreover, the evaluations suggest that in comparison with US$ 2,900 in Philippines, the average salary per year of an Indian graduate is US$ 2,400.

Hence, we can conclude that India is favorably located to control its cost and excellence benefits, to meet the increasing demand for offshoring of calculated business practices.