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India's Call Centres Take Calls From HomeBy ugesh sarkar, Section Computer Gupshup
From providing services to the developed world, the country is now shifting to cater to its own growing needs
With the US in recession, India's call centres have opened a new outsourcing frontier: India. The shift is a sign of how India's flagship export industry is shifting from providing services to the developed world to catering to its own, quickly growing market. The Indian economy grew 6.7% for the fiscal ended March 31.
 While outsourcing revenue from within India is still a tiny fraction of the global market--$12 billion (Rs57,360 crore) in 2008 out of $500 billion spent worldwide--it is expected to hit $95 billion by 2020, or nearly 15% of the expected global market, according to a recent McKinsey and Co. report. The overall global market for business process outsourcing will reach $640 billion in the same time, the report says. Indian outsourcers capture contracts from US clients largely by touting India's low wages and big cost savings. But at home, providing those lower costs means setting up offices in rural areas, where wages and property costs are lower than in its bigger cities. "We cannot deliver and make money in the same way we make money for an international market," says Ananda Mukerji, chief executive of Firstsource Solutions Ltd, a Mumbai-based outsourcer. In April 2007, his company opened a call centre in Hubli, a city of 800,000 people 370km northwest of Bangalore, India's outsourcing capital. Hubli is best known for its cotton and peanut farms. But it is also a place where wages and rents are half of those in major cities such as Mumbai. A call centre worker who gets roughly $500 a month in Mumbai would earn $250 to $300 a month in Hubli. source: Live Mint India's call centres take calls from home Click On "Full Story" For More..
Firstsource now has 450 workers in Hubli, where it is the largest private employer. It is one of the firm's 15 outsourcing centres for the domestic market. In the past two years, Firstsource has seen the India share of its annual revenue, which stood at $370 million in the year ended March 31, jump to 13% from 1%.
Small towns such as Hubli have fewer computer programmers needed for high-tech outsourcing, so the call centres tend to handle customer queries and complaints, processing bills paid over the phone or reminding delinquent customers they need to pay. Outsourcing as a common business practice has only recently taken hold in India. "We have always believed in focusing on our core expertise," says a spokesman for Tata Teleservices Ltd, one of the country's largest telecommunications companies. "Outsourcing of functions like telecalling and billing helps us focus on our core business." Sandeep Aggarwal, vice-president for sales at Mumbai-based call-centre operator Intelenet Global Services, says even Indian companies in conservative industries such as banking are turning to outsourcing. Since 2007, Intelenet has hired 23% more people at call centres for Indian clients, bringing the headcount to 18,500.
India's biggest technology companies are also jumping into a domestic market they long ignored in favour of larger riches in the US and Europe. Some of the earliest outsourcers in the Indian market were foreign companies, such as International Business Machines Corp., which bought Daksh, an India-focused call centre and back-office services provider, in 2004. "India is a focus area we are bringing in now," says Ashutosh Vaidya, head of the business process outsourcing unit for Wipro.
Intelenet executives say they can open an office in fewer than three months from scratch--but infrastructure is often the largest consideration when deciding which cities to expand into. At the Intelenet office in the New Delhi suburb of Gurgaon, there is enough diesel fuel to run the call centre on backup generators for three days if the power lines go down, and the company has backup phone lines if one service goes out of order, says Aditya Arora, the company's operations manager for northern and eastern India.
India's more traditional heartland culture looks askance at its young--especially unmarried women--working in modern offices where men and women work side by side, which is unusual outside of major cities. So the outsourcers try to win over parents by inviting them into the office to show off the facilities and talk of the extra money their children will be making, among other perks.
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