Tuesday, November 6, 2007

KPO boom in India

If reports from reliable sources are to be believed, India is to experience the KPO boom, next. The Mckinsey Global Institute estimates that the volume of offshore outsourcing will increase by 30 to 40 % for the next 5 years. 3.3 million Jobs will be generated overall by the year 2015. Deloitte research predicts the outsourcing of 2 million financial sector jobs by 2009.

In this scenario India will act as the primordial sea using its biggest strength - that is a supply of at least 2 million graduates and 300,000 Post Graduates - to help the KPO industry evolve into a mass job generator. There are many countries in the race. However, today all roads leads to India.

Primary reasons for such an attraction being the cost of labour, which is significantly lower than in the West and that India is tested ground. Through its BPO and IT industries, India has proven that it can deliver high quality services.

Equity research is one of the key areas in which KPO will flourish. On average Wall Street is losing $ 4 bn a year on producing equity research. To save on costs and to increase their value proposition to clients, Wall Street is discovering the value proposition of operating in low cost countries.

Many global investment banks have also been quietly building their back office research in India. No matter how cost effective a back office in India might prove to be it is still a field where experts can establish themselves and carve a niche for themselves attaining marked professionalism. Copal Partners is one such firm having complete expertise in the financial research outsourcing market

Joel Perlman, Co-founder and President of Copal Partners says that "outsourcing is a very good thing for India. It will totally change the Indian economy. In 10 years, India will have become the knowledge center of the world. And it will not be because India is cheaper (this will go away), but because India has the scale in terms of people."

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