Challenge for the BPO industry in India

BPO is one of the fastest developing Industries in India. But currently Indian BPO is facing some challenges due to its vast growth. The challenges can be classified as external and internal challenges. Internal challenges are the inadequacy of the managers for the senior and middle management and the high rate of attrition. External challenges include Obstruction from UK labor union and the US politicians against the altering of all BPO functions by local companies to India.

Indian Industry lacks experienced middle and senior mangers .Deficiency of senior and middle manager is a big issue. Employment and entry level recruitment is not a problem with fresh employers with good communication skill, available readily in the job market. The issue is more severe for the third party outsourcing companies that have just speculated into this business. These companies fail to invest in training, given their financial and other restraint.BPO companies such as American Express and GE, that are established performers in the business, have no such issues. They have stable investment to train their managers, even though they faced so many problems. Their senior and middle managers are being encroached by new entrants to the company. Report shows that established performers face an attrition rate of forty five percentages against the average of thirty five percentages.

Next issue is high attrition rate. It means not only the training cost of new appointments but also the loss of talent. The rate of attrition in this Industry is about thirty five percentage, which is high for any company. Normally in average call center the employees will work only for 11 months, but in average UK call centers they work for 3 years. Attrition rate comes down once the growth equalizes. So rapid growth of industry is the one of the reasons for high rate or attrition. To avoid such issues the company must recruit the experienced employees not only at the management level but also at the new entry level. Company also must be willing to invest in training employees to create responsible managers and team leaders.

Another important issue is the limited growth potential for employees in the company. The company should give more career growth for the employees .They should promote the employees form lower to higher position within the copmany.Indian Industry is having more competitors like china ,Ireland and Philippines. But China cannot compete with India due to the lack of English speaking employees. India can defeat all the competitors it does not mean that Indian industry can sit and take rest. It should be well prepared to face the compitation.It should keep up its value chain without confining itself to low skilled jobs. It must try to maintain its competitive position over the competitors, in terms of quality people, low of cost and favorable environment.