BPOs promote laterals internally to retain talent

Written by Diksha Dutta | Diksha Dutta | New Delhi | Updated: Sep 4 2011, 06:48am hrs
The $14-billion Indian business process outsourcing (BPO) industry, infamous for not providing a serious career path to youngsters, now seems to be trying hard to change its image. Rather than hiring laterals from outside the company, these BPO firms are showing freshers a way to grow within the organisation. BPOs like Infosys BPO, WNS Global Services, Hinduja Global Solutions and Genpact are hiring less laterals externally, but are focusing on creating an internal growth path for employees with experience of less than five years.

Take the case of Infosys BPO, the BPO arm of the countrys second largest software exporter. Says Raghavendra K, vice-president and head, human resources, Infosys BPO, In the past two-three years, 55% of our lateral positions were filled from within the company and we hunted outside for the rest of 45% lateral positions. But for this year, we have set up a goal of 70% of laterals to be from within the company and are very close to achieving this.

Raghavendra refers an employee with more than three years of experience and with subject matter expertise to be a lateral. He also feels that this step will help fresh graduates to see a BPO job as a long-term career path.

As an industry average, the BPO sector is driven mostly by freshers. Almost 65-70% of BPO employees are freshers and the rest are laterals. The BPO industry employs around eight lakh people today.

HR recruitment firms like Kelly Services too are feeling the effects of this trend. Earlier there was a demand for laterals by BPOs in thousands, but now the number has reduced to hundreds by each firm. A year back, BPO jobs were in plenty and fat salaries were on offer. But soon companies realised that people are not seeing a growth path within the company. To amend this, if they hired 90% laterals from outside earlier, now they are filling 65-70% of the lateral positions from within the company, says Kamal Kamnath, managing director, Kelly Services.

Keshav Murugesh, CEO of WNS Global Services, the countrys third-largest BPO, says, The need to hire more laterals is still there, as the industry needs experts. But our goal is to promote more laterals from within the company rather that recruiting from outside. And recent initiatives like building domain-based universities have helped us promote more people from within the company in the past one year. There is huge investment which goes in building domain experts.

Says E Balaji, CEO of HR consulting firm Ma Foi, Five to six years back, middle-level talent for BPOs was not available and it had to be hired from other sectors. But today, the companies are training and promoting people who joined them when they were in their mid-20s and now the same employees are in early-30s. Today, they approach recruitment agencies only for niche and special positions at the middle level and not regular positions.

Adds Jessy Christin, vice-president of HR at Hinduja Global Solutions, Two years back we were majorly hiring laterals from outside. But today, 85% of our laterals are from within the company and we look outside only for the remaining 12-15% positions. Christin feels now it is easier for the company to fill requirements from within, which was not the case earlier. It also helps us to retain people as promotions are encouraging, he notes.

There are companies like Genpact, the countrys largest BPO, that adopted this trend much earlier than anybody else. Says Tiger Tyagarajan, president and CEO of the company, Genpact for many years has prided itself on developing leadership talent systematically. The only way to do that is to have a strong training and career path programme that gets 70-80% of positions filled through internal promotions. It is something we have done for many years and that is why we have leading retention rates in the industry. We have driven internal promotions of that percentage for more than seven years now.