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Synopsis

Business Process Outsourcing (BPO) is the delegation of one or more business processes to an external provider that in turn owns, administers and manages the selected process based on defined and measurable performance criteria.
This enables the company, which outsources such business processes to concentrate and build on its core competencies.

The BPO industry in India is gaining momentum and promises to add 3.3 million jobs in India. India has one of the largest pools of low-cost English-speaking scientific and technical talent. This makes India one of the obvious choices to outsource to. Dell, Sun Microsystems, LG, Ford, GE, Oracle, all have announced plans to scale up their operations in India. BPO promises to transform India economically much in the way oil transformed the economies of West-Asian countries.

But all is not well with the BPO industry in India. The industry has to contend with a very high employee attrition rate of 30-35%, which is way above the global average of 24%. Insiders from the industry attribute the current crisis in the industry to causes like lack of growth opportunities in BPOs, non-conducive policies and regulations, lack of a defined career path for employees, physical and mental stress associated with odd working hours, monotony of work, lack of a robust appraisal system, large scale poaching between players in the industry and the "low-profile" brand image associated with a BPO job.

The issues mentioned above are by no means insurmountable. Setting proper expectations, designing and implementing a sound training and orientation program, proper rewarding, transparent performance appraisal procedures, encouraging employees to pursue higher education and creating a work environment which would serve to relieve the stress and pressures associated with work, are a few measures which can be undertaken to drastically cut down on the attrition rates.

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* Contributed by: -
Vinodh Ravishankar,
Vinod Gupta School of Management, IIT Kharagpur.