Indian BPO industry fights attrition trap

GURGAON: With attrition rates looming ahead from 30 percent to 40 percent at the agent levels and managerial levels also giving these rates a stiff competition, all hell is breaking lose on the Indian BPO industry. The biggest competition for the Indian BPOs is to bring its house in order, not the burgeoning Asian cousin Philippines or the pink elephant campaigns. Most of the BPO firms are finding it difficult to deal with this monster.

BPO firms are resorting to various strategies ranging from giving luxury comforts to its employees (housing scheme, low rate loans, pick and drop, attractive catering), having spouses working in the same organization, recruiting the non recruitables (like housewives and old age people) or in some cases signing anti-poaching agreements to retain people.

As the BOSS syndrome hits the agents and managers akin, BPO seems to be a stop gap arrangement for few and few find the lifestyles inimitable. Fraught with these challenges, according to NASSCOM figures, currently attrition is about 35 percent in non-voice and 45 percent in voice call centers. About 80 percent of them look for better careers within the same industry. Agents want to become team leaders. Team leaders want to become supervisors. Supervisors want the job of the CEO.

BPOs are trying a fix-all solution for keeping this trained manpower with itself and create a quality manpower pool that will stick with the organization for a longer period of time. As on March 31, 2003, the sector employed 171,000 professionals. It has $ one billion invested in it and generated revenues of $ 2.3 billion in 2002-03.

Naukri.com CEO Sanjeev Bikchandani just finished a short study on the reasons and intensity of attrition in India. "The prime reason is that the workforce is very young and there is a mismatch of aptitude, aspirations and the rate of growth in this industry," he said. According to him, not many can anticipate the biological issues and the monotony of the work. "To an outsider, this job pays well and is a party, but it is in reality a very high pressure job that requires high level of commitment and skills," he added. Managing people can arrest attrition according to him in a more proactive manner.

Manpower Inc. MD (Asia Pacific) Iain Herbertson reiterated that Indian BPO would need to learn to manage its people better to escape the stagnated growth. "India has a USP of knowledge, for which BPOs and other industries are moving to India. They need to be managed in an intelligent manner for an accelerated growth rate to beat the other regions in the world," he said.

Exl CEO Vikram Talwar said that with present pressures of reducing costs and higher compensation levels, managing right people at the right place needs to be fought at war levels. "Anti-poaching agreements, better perks, higher compensation levels, employee satisfaction-all these tools are being employed to arrest this aggravated attrition situation. But any affect is yet to be seen." He says that with the constant pressure to reduce billing rates, getting quality outputs and reducing the learning curve, attrition needs to be under control. Exl Services HR head Deepak Dhawan feels that managing manpower in BPOs, which is young is the most difficult task.

Hero IteS services director Anupam Bhasin feels that a well-laid career plan is essential for retaining an employee. "An unstructured career path results in higher attrition. We also need to line up better recruiting methods to filter the right people for right places," he said.

According to V Customer CEO, Sujit Bakshi people can be advantage and threat at the same time. "We invest in people to perform. With stringent SLAs and direct interaction with customers, the work pressures are enormous for these young employees. We have to balance between performance expectations and growth aspirations," he said.


Global Vantage VP (HR) R Prakash Toppo feels that attrition is a part of a growing industry. "In a growing industry that is investing heavily on training will have these residual effect, which will become better. But as organizations we will have to hone our HR skills and invest in improving the recruiting techniques and satisfying employees."

Hughes BPO Services' Aadesh Goyal echoed similar thoughts. "To gain operational excellence and retain the cost advantage, we will have to learn to manage our people situation. We can not wait and watch. Mobilizing resources is also a great concern. If this industry has to grow, it will need quality people that can give incremental performance and in return organizations should be able to give employee satisfaction."

Considering the general industry opinion given above, the key directive for BPOs seems to be to manage attrition through smart people-management tools rather than create collaborative intra-industry agreements. People issue is important, but myopic vision might stop the situation for sometime but industry need more than that.

CyberMedia news service