Business Process Outsourcing (BPO) could become unionized

http://economictimes.indiatimes.com/articleshow/msid-792570,curpg-1.cms

ECONOMICTIMES.COM
[ WEDNESDAY, JULY 28, 2004 12:25:40 AM ]
NEW DELHI:

Swank offices, young crowd and increasing salaries - these are the blessings of BPO wave to name a few. This sector, thriving on the outsourced projects, is full of carefree young employees who are enjoying money and BPO lifestyle and thats it.

Till now the sector has been away from any kind of unionism. But the bug is fast catching on here also. Trade unionism is entering the infotech bastion, reaching out to the low-wage sweatshops that business process outsourcing outfits have become.

The global Union Network International has launched a new organisation that targets workers in Indian back-offices . The Centre for Business Process Outsourcing Professionals has been launched in Hyderabad and Bangalore and will be formally registered in August.

The centre has already begun talks with BPO outfits in Noida, Chennai, Mumbai and Pune. The organisation claims to have about 200 members and expects its ranks to swell to more than 5,000 by year-end.

The rise of a trade union in BPO space has spooked the industry, which has already been under fire in the US and Europe for spiriting away jobs to the sub-continent. Some experts say that this could kill the BPO boom in the country, which even the powerful India-bashing lobby in the US has not managed. "This is bad news for the sector," Pavan Duggal, a senior cyber lawexpert and Supreme Court advocate, told the Telegraph."Over the last few years, the BPO segment has emerged as a major foreign exchange earner. Growing trade unionism will kill this industry.

The centre does not term itself a union, but its mandate is not much different. "We are not a union; it is an old word, we are a forum. However, we will take up issues that need to be addressed to ensure the well-being of the workers," centre chairman J.S.R. Prasad told The Telegraph.

The centre will be registered as a forum affiliated to the Union Network International, linked to the International Confederation of Free Trade Unions. Major Indian trade unions are members of the latter, which will make the centre another union.

He also said that the BPO industry is unregulated and has many problems. The managements do not take care of the workers' health or fix proper working hours. There is no job security. Salary structure, job security and the future of workers in an organisation are on the agenda.

Business Process Outsourcing (BPO) firms continue to increase outsourcing jobs in astounding numbers

from:
http://timesofindia.indiatimes.com/articleshow/729062.cms

*NOTE: The following article is based on the viewpoint of the India press and business concerns.
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TIMES NEWS NETWORK
[ THURSDAY, JUNE 10, 2004 12:42:18 AM ]
BANGALORE:
The backlash on outsourcing in the US and the UK notwithstanding, MNC BPO players are set to deluge India with jobs.

Companies such as IBM, EDS, Accenture and Convergys are aggressively ramping up their headcount in India to astounding numbers. The profile of work they do has also gone up significantly, meaning the new jobs will require higher skill-sets.

According to US consultant McKinsey and Company, Big Blue, which recently acquired the Gurgaon-based BPO firm Daksh, is planning to scale up to around 25,000 BPO professionals in India over the next five years. EDS plans to hire 3,000 people here over the next three years.

Similarly, Accenture pursues the ambitious target to cross 10,000 people over the next couple of years and Convergys aims at growing its manpower by five times in as many years, which will take it beyond15,000 people.

At the same time, BPO leaders like GE already employ around 20,000 agents in India, while Citibank and HSBC have 10,000 employees each.

According to Nashir F. Kaka, partner, McKinsey and Company, a big shift is taking place in the MNC mindset as they move from tactical piece of work to handling complete business systems out of India. He said the MNC BPOs are beginning to focus on enhancing productivity than depending on cheap labour available in India.

According to Kaka, contrary to the popular belief that ITES (Information Technology Enabled Services) is less lucrative than IT services, the providers can enhance their profit margin by reengineering the supply chain and automation. He said a true BPO in the US earns 2.5 times more margin than an IT systems integrator.

The MNC BPOs, while ramping up their operations here, have to cope with challenges like retaining and attracting talents, managing financial pressures, effectively tackling the issue of transfer of control and maintain quality. Outsourcing to India offers compelling business proposition to companies and has helped companies achieve 40-50 per cent cost savings. At the same time, the BPO buoyancy here is creating 200 new jobs in the country every day and in the last financial year, ITES-BPO companies were the largest recruiters with 70,000 jobs.