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Operations Article | Key Operational Challenges in the BPO-ITES Industry

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Key Operational Challenges in the BPO-ITES Industry

- by Ankur Pawa & Nishant Choudhary *

This Paper has won Second Prize in "Opsyrus 2005", the CoolAvenues.com - OIG (IIM Lucknow) Paper Writing Competition held in October 2005.

Page - 1

Executive Summary

Soaring revenues, increasing job opportunities, changes in life style, excellent growth prospects and a global footprint - the Indian BPO/ITES industry has achieved it all. Currently sized at $2.3 billion, the Indian BPO and ITES business in the country has been pegged at $21-$24 billion by 2008. Some of the key factors that have led to this unprecedented success are:

  • Financial Benefit - Cost Arbitrage
  • Process Maturity and Delivery Capabilities
  • Human Resources
  • Government Support

    In order to sustain its success, the Indian BPO/ITES industry needs to ensure that it is able to ramp up its resources and infrastructure with the growing demand. It also needs to concentrate on strategic issues like avoidance of price war, acquisition of domain knowledge, growing from low margin businesses (typically voice based) to high margin businesses (Analytics, Financial Management, etc.) and leveraging existing IT offshoring services for cross selling to existing clients.

    Apart from the strategic issues, there are a lot of operational challenges facing the Indian BPO/ITES industry. We have identified these issues and explored some of the possible approaches to overcome them. We classified the operational challenges as:

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    * Contributed by -
    Ankur Pawa & Nishant Choudhary,
    Indian Institute of Management,
    Lucknow.


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