|
Outsourcing firms battle to keep staff
Reuters India - Mumbai,India
By Rosemary Arackaparambil
BOMBAY (Reuters) - Indian back-office firms face a growing
challenge holding on to employees, even as they hire tens of
thousands every quarter.
Some firms say they need to replace up to half their people
every year. Call centres, which snap up English-speaking
youngsters with the gift of the gab, are the worst hit, and
they account for nearly 40 percent of back-office jobs in
the country.
"It is a major problem," said Jerry Rao, chairman of
back-office and IT services firm MphasiS BFL Ltd.
Staff tend to account for half of a back-office operation's
costs, according to research firm Evalueserve, and the
battle for talent has led to a 10-15 percent rise in
employee salaries.
Recruitment and training makes up 3 percent of the overall
per employee cost of about $13,000 per year, including
administration and telecoms costs, according to Evalueserve.
But the really damaging cost is the lost business for
companies who cannot fill key jobs quickly enough. Many face
a shortage of mid-level manpower to manage their rapid
growth as they lure clients with promises of 40 to 50
percent cost savings.
As the industry clocks up 50 percent-plus growth, demand for
quality personnel is outstripping supply. Employees often
hop to new jobs for slightly more money, and many do not
view back-office work as a career.
FIGHTING ATTRITION
Companies provide free transport, subsidised meals and
housing to retain staff, and try to enliven the environment
with musical entertainment, yoga classes and costume
contests.
But that is not always enough.
Spectramind, the back-office arm of India's third-largest
software services company, Wipro Ltd., reported a 90 percent
annualised attrition rate at the end of December.
"The high attrition rates we have had really limited our
ability to continue to add people once we get to the scale
and range we are in," Wipro Vice-Chairman Vivek Paul said,
predicting slowing growth for the division in the current
quarter.
India's business process outsourcing sector has 400 players,
though the top 20 account for nearly half the sector's
revenue, seen touching $5.7 billion this year.
The industry is on track to employ 350,000 people by the end
of March, up from 253,500 a year earlier. With international
businesses increasing call-centre and other back-office
operations in India, the industry is expected to need a
million people by March 2008.
But B. Sudhakar, chief operating officer at PeopleOne
Consulting, says the pool of good candidates -- particularly
for call centres -- is limited.
"Not everyone who speaks English has accent-free diction, so
very few are 'camera-ready'," he said.
NEW BUSINESS MODEL WANTED
Experts say the way out is to move up the value chain by
expanding from voice-based business to more
transaction-based business, where employees may see better
career opportunities.
The National Association of Software and Service companies
estimates that technical support, accounts management,
payroll and benefits services are areas with high growth
potential.
Firms are also beginning to take on more
"knowledge-oriented" jobs such as equity research and data
mining, which may interest recruits more, but they form just
a fraction of the industry now.
Gautam Sinha, chief executive of Bangalore recruitment firm
TVA Infotech suggests that outsourcing firms centred around
Bangalore, Bombay and Delhi should fan out to other cities,
where expectations are lower and employees are less
opportunistic.
He said the industry needed to expand tie-ups with schools
and offer part-time professional courses and subsidised
tuition fees and recommended companies send veterans to
campuses to tell students about potential career prospects,
since many enter the industry for the easy money and then
leave after a few years.
"People also move out when they realise this is not the
career they wanted, or they want to get more education,"
said K. Thiagarajan, chief operating officer at Hinduja TMT
Ltd..
Sara Quinny, 23, quit her job two months ago after 2-1/2
years of phoning Americans about their overdue credit card
payments.
"It was my first job interview, I got it and it was pretty
exciting at first. But I ended up doing the same thing every
day. Just sitting there for nine hours and making calls all
the time," said Quinny, who said she'd wanted to join the
airline industry when she finished college. |
|
