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Thursday, 28 September 2006 20:07

Indian offshorers move offshore

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ImageIndian BPO firms are now moving offshore—either expanding their operations to overseas destinations or buying out firms on foreign soil in South Asia, Eastern Europe and Central America.

With clients seeking a de-risking strategy, closer proximity and business continuity planning, Indian BPOs are realising the advantage of being present in locations that offer scalability, particularly in specific language domains and making acquisitions to add to their portfolio of offerings and new customers too.

Infosys subsidiary Progeon is in the Czech Republic and will soon go live in China. Wipro BPO is up and running in Romania, while the Satyam BPO arm, Nipuna is also looking at the setting up operations in Philippines, Malaysia or Budapest. ICICI Onesource recently announced a centre in Northern Ireland. Accenture which has a huge BPO operation in India has a BPO unit in Poland.

Traditionally, companies have gone to China and Malaysia for Chinese, Mandarin, Korean and Japanese skills while Eastern and Central Europe are the main destinations for French, German, Italian, Spanish and Dutch. Central American countries like Costa Rica, Mexico, Chile and Argentina cater to the Mexican-speaking US population while traditional centers like the Philippines and Ireland have always been favorite BPO hotspots for companies right across the globe.

Despite higher costs in Ireland, HCL Technologies BPO already has over 2,000 agents in at Irma and Belfast, while TCS’ BPO operations are located in the UK and Chile, apart from its other cities in India, of course.


Other India-based BPO vendors such as Genpact, IBM-Daksh, Hinduja TMT already have an overseas presence.

Says T.K. Kurien, CEO, Wipro BPO, “When you start taking up a company’s processes you need to move on to an end-to-end services model which includes global solutions delivery capabilities. In the areas that we are in, we would like to be kind of experts in that area. So we have picked a few and in those specific areas we are saying we will build market dominance and providing local support is a part of our overall strategy.”

In another year, Wipro BPO will have 1,500 European nationals in Europe. Its Brazilian capability came along with the $53 million acquisition of Enabler, a European retail services provider. Enabler has a centre in Brazil near Sao Paulo, which specializes in analytics tasks and also provides good German and Spanish language skills. Wipro BPO plans to grow this to 350 seats from 150 at present.

BPO companies have to check out multiple geographies for the right resource because the clients they serve are MNCs with global operations.

“This is the way of the future. Indian BPOs have to taken on the global route and this is absolutely the way to go forward,” says Akshaya Bhargava, head of BPO investments of a UK based private equity firm, 3i. Prior to this, he was the CEO of Progeon, the Infosys BPO arm and made it a stand-alone success.

Earlier this month, Infosys announced the expansion of its near- shore capability at Brno in the Czech Republic where a new 350-seat facility is under-development to double the capacity of its existing facility. The centre, slated to open in January 2007 will continue to offer BPO services and would also IT services to its European customers.


“We choose such locations primarily as the language skills are not scalable in India. Moreoever, clients want to have cultural proximity,” Progeon CEO, Amitabh Chowdhry said.

A couple of months ago, Genpact, a leading BPO, acquired US-based MoneyLine Lending Services, a mortgage origination and fulfilment services firm. Genpact's President & CEO Pramod Bhasin said “Not only does this acquisition give MoneyLine access to our global delivery capability but also enables Genpact to deepen its offerings in the mortgage services business.”

Meanwhile, companies that are have not made any acquisitions are also now looking across Indian shores even for a partnership kind of a tie-up.

For instance Mumbai-based Intelenet Global Services has a partnership with Transcom, a European customer services provider, which allows it to offer services in a number of languages.

However, the kind of numbers most companies are looking at in these geographies are a maximum of 1000-seat operations. If it is EU or South America, the figure would touch 300-350 but if it is in established hubs like the Philippines or Ireland, it could go up to even a 1000 call center agents.

“Although the numbers are quite small at this moment, we should look at it as a first step forward. Eventually, this would be big,” Bhargava said.

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