September 2008 News

  • September 2008
    • China, India top pharma outsourcing hub
      China and India emerged as the best outsourcing pharmaceutical destination followed by Korea and Taiwan, according to a study by PriceWaterhouseCoopers on the changing dynamics of pharma outsourcing to Asia.
    • Global finance crisis: Indian BPOs will benefit
      In the next five years, global business process outsourcing by the financial services sector will be worth $ 145-165 billion for India-based services providers, says a study by Everest Research Institute.The study entitled ‘Global Sourcing in Banking, Capital Markets and Insurance’ further states that offshore BPO adoption in the insurance sector will grow 12-15 times in the same time period.
    • ‘Studio i’ to handle architectural KPO
      Gensler, the San Francisco-based architecture design company, and Singapore-based architecture firm, Space Matrix, have set up their joint venture — ‘Studio i’ in Bangalore. ‘Studio i’ has been set up to handle architectural and interior design knowledge process outsourcing.The company’s operations will be carried out from its facility at Divyashree Park SEZ in Whitefield, Bangalore.
    • OrangeScape launches a comprehensive, ‘managed’ production floor solution for BPOs
      OrangeScape Technologies ( one of the leading software product companies in the country today launched BPO Suite, a comprehensive, ‘managed’ production floor solution for BPOs. This is the first of its kind solution for the BPO industry that enables BPO providers, fight margin pressures by productivity saves & improve predictability in delivery.
    • Meltdown may mean more business for LPOs
      ven as the global meltdown casts its spell on India, there is one sector which could see more action in the coming months. Legal process outsourcing (LPO) is set to witness a surge in business, with more corporate houses and investment banks from the US turning to them for legal advise.Bankruptcy filings in the US have gone up in the last couple of months and that inturn has raised the demand for lawyers. Corporate houses in the US are increasingly shifting their credit crisis-related work to lawyers in India as it is a more viable and cost-effective option.
    • WNS recognized at Third Annual CIO 100 Awards
      WNS (Holdings) Limited, a leading provider of global business process outsourcing (BPO) services, today announced it has been awarded the Storage Award 2008 by IDG’s CIO magazine at a special awards ceremony, the CIO 100 Awards.
    • Barclays not to acquire Lehman’s back-office unit
      Back in India, those familiar with the way Robert E Diamond (Bob Diamond) runs his operations say there’s a slim chance that Barclays may be interested in acquiring Lehman’s back-office operations in Mumbai. The UK bank, which last week agreed to acquire Lehman’s North American operations, is believed to have also interested in other units of Lehman’s global operations, including India.
    • Genpact joins race for Lehman’s captive unit
      Genpact, the country’s largest BPO firm in terms of revenue and headcount, is in the race to acquire Lehman Brothers’ Mumbai-based captive back-office unit for an undisclosed sum. Genpact has been scouting for captives and niche companies in India for acquisitions for quite a while now.
    • Nasscom: Short-term impact on outsourcing
      Nasscom a global trade with over 1200 member of which over 250 are global companies for the US, UK, Japan and China. With the tentacles of Lehman Brothers fiasco unfolding on the Indian software companies, the industry Nasscom on Thursday, on Sep 18 said there would be short term and company specific impact. Stating that the Indian IT-BPO sector is a part of the global financial system that has seen a lot of turbulence in the recent past, the apex said ‘our preliminary analysis of the current situation indicates that the impact will be short term and company specific. We will continue to keep a watch on any further downstream impacts.’
    • Credit Suisse joins race for Lehman’s India units
      Credit Suisse, Barclays and some private equity firms are in the race to acquire the India operations of Lehman Brothers, which filed for bankruptcy in the US. The India operations are being treated as a separate bidding entity from the rest of the Asia.The firm’s Powai office, which includes the BPO, KPO and the captive units, is being looked at by Credit Suisse, Barclays and PE firms, said sources close to the deal.
    • Wipro eyes Lehman’s back-office unit
      Indian outsourcing firms Wipro Technologies and Copal Partners have expressed interest to bid for the Indian back-office unit of collapsed Lehman Brothers, a daily paper said in an unsourced report.The US investment bank, which filed for bankruptcy protection on Monday, has asked its 1,200 employees in a Mumbai unit, which does equity research and analytics support for its mergers and acquisitions business, to leave by the end of September, the newspaper said on Wednesday.
    • Credit crunch: BPOs revenues to be dented
      The catastrophic events overtaking global financial majors will dent the revenues of Indian outsourcing majors, both in terms of the expected business and contracts they have already undertaken.Number one software services vendor, Tata Consultancy Services, is likely to be worse off than its peers because of its significant exposure to Merrill Lynch which, analysts said, ranks among its top five financial services clients.
    • What Is In Store For Lehman In India?
      Lehman has filed for bankruptcy protection in the US courts under chapter 11, which means the company has claimed protection from bankruptcy and still can remian in business and avoid liquidation. This is different from chapter 7, where the bankruptcy trustee gathers and sells the debtor’s non-exempt assets and uses the proceeds of such assets to pay holders of claims (creditors).Sources tell us that Lehman Brothers has to wind down their operations in Indian in any case. They will have to stop making principal investments in companies and also expsoure to stock markets.
    • Condom vending machines to be installed in call centres
      With the HIV/AIDS threat rising to IT companies and call centres, the Andhra Pradesh State AIDS Control Society (APSACS) plans to install condom vending machines in their campuses.The authorities have begun approaching call centres and BPO companies to persuade them to install condom vending machines.
    • Providence, ICICI arm in joint bid for Firstsource
      The country’s largest private equity fund, ICICI Venture, is teaming up with US-based PE fund Providence to put in a joint bid for BPO firm Firstsource Solutions.ICICI Venture is also wooing Kohlberg Kravis Roberts & Co (KKR), one of the world’s biggest buyout funds, to join the consortium, said a banker.
    • TCS, Infy & Wipro: The IT service megavendors
      Tata Consultancy Services (TCS), Infosys Technologies and Wipro Technologies, collectively referred as ‘India-3’, will emerge as the next generation of IT service megavendors, according to Gartner, Inc.These vendors are increasingly being considered for strategic service deals, and will augment or, in some cases, replace today’s acknowledged megavendors by revenue – IBM Global Services, Accenture and EDS – in this space by 2011.
    • BPOs flock to rural areas to set up shop
      Rural business process outsourcing is catching the fancy of many Indian biggies, with the companies eyeing it more as a business proposition rather than a corporate social responsibility.With the telecom industry aiming to increase its rural subscribers base and the central bank asking banks and financial firms to cater to the rural sector, businesses will have to find ways of servicing customers, say analysts. Most of the rural BPOs have a seating capacity of below 100 per centre, as they are situated in remote areas.
    • Report of Nasscom on India’s top IT locations
      The software and services trade Nasscom along with A T Kearney released the findings of a first of its kind report on the assessment of 50 locations in India suitable for the IT – BPO industry titled ‘Location Roadmap For IT- BPO Growth: Assessment Of 50 Leading Cities’.
    • Aegis BPO on prowl, eyes four companies
      The Essar-owned $330-million Aegis BPO is once again on prowl. It plans to buy four BPOs in a year. Aegis has already acquired 11 companies during last four years.“We are in talks with over six BPOs and plan to close deals with at least four of them. Our plan is to add a company every quarter as part of our inorganic and organic growth. Cash is not a problem as we have cash-rich Essar Group as our parent,” says Aegis CEO Aparup Sengupta.
    • QAI India buys out US parent
      In a transaction representative of the aspirations of emerging Indian companies, Quality Assurance Institute (QAI) India, an operational excellence company enabling companies in the IT and ITeS sectors to deliver high performances, has bought out its US-based parent, QAI Worldwide.
    • BPO exports grow 21.4 per cent
      India’s third party business process outsourcing (BPO) services exports in 2007-08 grew 21.4 per cent to Rs.264.23 billion, up from Rs.217.60 billion in the previous fiscal, according to a new study.In dollar terms, the growth was even more impressive at 36.6 per cent to $6.6 billion, up from $4.8 billion last fiscal, said the study. It ranked Genpact as the No. 1 export revenue earner with revenues of Rs.26.59 billion, up by 19.8 per cent from Rs.22.20 billion that the company earned last fiscal.
    • Payments to foreign cos by call centres taxable in India: ITAT
      Foreign companies providing connectivity and other technical services to domestic call centres through their overseas offices are liable to pay tax on their income in India, the sectoral tribunal has said.As per the decision by Income Tax Appellate Tribunal (ITAT) in two cases filed by the Hyderabad-based Frontline Software and Call World Technologies, the domestic call centres have to deduct tax at source on payments made to foreign companies on support services from abroad.
    • UK’s Serco in talks to buy InfoVision for Rs 250 cr
      UK-based $2.6-billion services major Serco Group is in talks to acquire Indian BPO player InfoVision Group. The deal size is learnt to be Rs 200-250 crore. Industry sources say InfoVision, which is talking to a couple of IT-BPO firms, including Serco for a sellout, could finalise a buyer in 3-4 weeks. InfoVision provides customer relationship management, finance & accounting outsourcing, KPO and HR outsourcing. It employs over 11,500 people at centres in India, the US and Australia.
    • India BPO Firstsource stake put on sale
      Firstsource, one of India’s leading business-process outsourcing companies, has put one of its stakes up for sale.
    • US outsourcing drug research to India
      In her swank headquarters just blocks from some of Mumbai’s worst slums, Swati Piramal is midway through an impassioned pitch about revolutionising the world of drug discovery. Sanskrit passages of the Bhagavad Gita, the ancient Hindu text that guides her business philosophy, adorn the office walls of her company, Piramal Life Sciences. Its logo is gyan mudra, a finger gesture used in yoga meditation resembling the Western sign for “A-O.K.”
    • Obama promises to retain and create jobs
      US Presidential hopeful Barack Obama once again touched on the ticklish issue of outsourcing and while vowing to end tax breaks to companies that ship works overseas conceded that all lost jobs could not be redeemed.Promising to retain as well as create more jobs for the Americans, the Democratic nominee said while all lost jobs cannot be redeemed, further movement can be halted by giving incentives to companies investing in the country.
    • Obama’s Outsourcing Assault
      The press has been buzzing with the latest American electoral war development. Obama, on one side, has vowed to discourage outsourcing across America stating the age old adage that American jobs should remain in America. John McCain on the other hand believes that outsourcing is helping to create a healthy competitive US economy.
    • IBM India inks $450 mn IT deal with MNYL
      IBM India has entered into $450-million IT outsourcing contract with private insurance player Max New York Life (MNYL). The technology services behemoth, which has already showcased the advantage of total IT outsourcing with the telecom major Bharti, is expecting this deal to pan out in the similar manner.The deal, spread over ten years, will see IBM India providing complete end-to-end backend IT infrastructure to MNYL.
    • Incentive plans in BPO companies lag general market practices
      Attrition rates in India’s lucrative BPO industry are about 7.8 percentage points higher than in other industries, according to a report released today by Hay Group, a global management consulting firm.The finding comes from a new report, BPO Special Sector Survey 2008, based on Hay Group’s global online compensation and benefits database, PayNet. It showed that in general, staff turnover in India is 15.7 per cent, but at BPO companies, attrition is the country’s highest at 23.5 per cent, followed by Communications (22 per cent) and Retail (18 per cent).
    • Now, Europeans are more open to outsourcing: E&Y
      Infosys Technologies’ acquisition of UK’s Axon couldn’t have been better timed as a new study finds that Europeans are becoming more open to outsourcing. The French, however, are likely to be more reserved than their English counterparts when it comes to adoption of outsourcing, according to a Ernst & Young study completed last month. The study found outsourcing was being used by 70% of the European firms surveyed.
    • Attrition rates high in Indian BPOs: Survey
      Attrition rates in India’s lucrative BPO industry is about 7.8 pc points higher than in other industries, according to a report released by Hay Group, a global management consulting firm on Monday, Sep 1.The finding comes from a new report, BPO Special Sector Survey 2008, based on Hay Group’s global online compensation and benefits database, PayNet. It showed that in general, staff turnover in India is 15.7 per cent, but at BPO companies, attrition is the country’s highest at 23.5 per cent, followed by Communications (22 per cent) and Retail (18 per cent).
    • BPOs to get Tamil, Bhojpuri right
      Since the business started, BPO agents have been put through American, Italian, French or British voice and accent training.Now it’s the Indian languages like Bhojpuri, Marathi or Tamil which the BPO agents are trying to master.

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