BPO firms grapple with unfit cadres

Written by P P Thimmaya | Debojyoti Ghosh | Debojyoti Ghosh | Bangalore | Updated: Feb 4 2013, 03:02am hrs
Unemployable, unskilled graduates force BPO companies to extend training period to six months

The $16-billion business process outsourcing (BPO) industry in India is now spending more time than ever before in training their employees, especially the freshers, as they are finding greater number of young graduates highly unemployable.

The BPO industry, which is used to spending about two-to-four weeks in training the young graduates, has now extended it to anywhere between 60 days to six months.

This has also resulted in training costs for the companies going up of late. Explaining the rationale for higher training time being devoted for their employees, Infosys BPO CEO Swami Swaminathan told FE, As the industry has moved from delivery of mere transactional services to more transformational initiatives, we need battle-ready employees as clients demand 100% quality and expect them to hit the ground running from day 1.

Though there has been talk of the growth rates slowing down for the IT industry in India, the BPO segment has not seen any dramatic fall and they are still faced with a demandsupply mismatch in terms of acquiring talent.

Earlier, we used to train people for six weeks; now, we train for five months, because the quality of workforce has dropped drastically. Today, you are hiring educated unemployable youth, said Raman Roy, CMD, Quatrro BPO Solutions.

Industry experts say there are five basic skills, which BPO companies look towards today when they hire young graduates: communication, comprehension, corporate skills, computers and analytics. Majority of them are of the opinion that the prevalent education system is not able to graduate students who have imbibed such skills. Recruiters feel that the biggest challenge for BPO companies is to find the right candidate. Only 10-15% students graduating today are employable, companies feel.

Lack of effective communication skills among freshers, along with the necessary soft skills, are a major concern. Sangeeta Lala, vice-president (sourcing), TeamLease, said, There is a big problem in finding talent. BPO companies are not finding the right people. The cycle of hiring is becoming longer. HR managers have to sit through a lot more resumes to get the right candidate.

These extended training programmes have also added to the costs of the company. Experts point out that, typically, BPO companies spend over a lakh per fresher every year on training and development. Depending on the nature of the firm and the size, about 15-40% employees are freshers.

Many in the industry feel that there is unlikely to any kind of quick-fix solutions to these challenges. Roy felt the scenario requires a larger game plan. As a country, we have to upgrade the education system. Like in IT that we created more engineering colleges and upgraded the curriculum, similarly we need to do in BPO. We can go for more finishing schools focusing on the BPO industry. The education system needs to cater to industry requirements," he said, he said, adding that we have not fine-tuned our skill sets. English language speaking is the main problem among young people today.

This lack of adequate talent for the industry has also got to do with the changes in the Indian BPO industry. Majority of the companies have moved away from simple voice and data-related work as these are getting increasingly automated, instead stepping into higher value services, which require completely different skillsets which are not adequately matched by the current educational system. In the last four years (2008-2012), the compound annual growth rate (CAGR) for the BPO industry has been sluggish at 12.47%, as against Indias IT services exports, which posted a 17.23% growth during the same period.

Many of the companies are looking at ways by which they could improve the quality levels of their employees. Leading players in the sector like Infosys BPO, TCS and Wipro have intense training and education programmes for their employees.

Pure-play BPOs like Quatrro and 24/7 Customer also provide degree and diploma programmes via tie ups with institutions. IT-BPO trade body Nasscom and Delhi University have jointly launched the global business foundation courses to hone the skills of students looking for a job in the sector. The programme is available to final year students across streams and covers modules such as industry awareness, business communications skills, customer management skills, PC and data skills and campus-to-corporate transformation skills.