Indian call centers expanding abroad to cut cost

October 18, 2011: The most common image which India had of the outsourcing experience was a room full of people speaking in English, to foreigners on the phone throughout the night. But this is all set to change as more and more US companies shift to cheaper destinations in Asia. Apart from this, what has happened is that Indian companies too have joined the bandwagon and are setting up offices in Philippines and Malaysia. But the most interesting aspect is that these companies are finding lower costs, English speaking graduates and better infrastructure in such countries.

India seems to have lost the call center capital status now. But in any case, India retains the numero uno status in high end IT support work. Apart from this, we see that more people are employed in Philippines and Malaysia combined than in India. Due to rising costs some Indian companies have shifter their base to small Indian towns and by hiring less expensive workers. They are also moving into high-end-back –office work and many other services.

It is to be noted that 13 Indian BPO’s have shifted base to Philippines and have hired local workers there. This is a finding from National Association of software and Service companies. Even Indonesia and Vietnam are moving towards attracting many companies for outsourcing businesses. It is surprising to be seen that most growth in the BPO space in the Philippines is driven by Indian companies.

Also, Indonesia and Vietnam also have enough potential to attract the outsourcing businesses. According to A T Kearney Global Services Location Index 2011, the Philippines earn about $ 5 billion dollars annually from BPO operations and soon it will be serving the pharmaceutical and healthcare industries.

It is also seen that the Filipinos and the Americans have a lot in common culturally. They watch English movies, play basketball and drive on the right side of the road. These are the views expressed by Mr.Sujith bakshi, President of Corporate affairs at Techmahindra.

There are many drawbacks for India companies. Firstly that Indian cities are unsafe and so employees have to be transported at night. This is about 20% of labor costs. Also, expensive diesel generators have to be used since there is no backup, when the power supply goes.

The most interesting aspect of the Indian Outsourcing industry is that, it gets to decide where and when will the outsourced business go. This is primarily a result of the experience and expertise of the Indian companies. So, India continues to be the emerging hub of all opearations.India continues to give training in the Philippines and working with their universities.  

But a new thinking is emerging in India, where Graduates are saying they would like to work for domestic companies in their own local languages. This is because India’s economy is booming and more companies are paying attention to customer care initiatives in the local market itself.

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