|
But underlying problems could prevent the Indian BPO/FAOs from taking full advantage of their opportunity. India-specific trends that could derail the BPO megamonster include the appreciation of the rupee against the dollar, wage hikes for staff posted abroad, hotter competition from multinational companies in application development and FAO, a tightening Indian labor market, staff shortages, high attrition rates and escalating costs, and serious oversupply from hundreds of competitors in the BPO industry—all of these factors have led to an overall “softness “in the outsourcing market, says Siddharth Pai, a partner at Houston-based outsourcing consultancy firm Technology Partners International Inc (TPI).
Moreover, on a global scale, China, the Philippines, Eastern Europe and other nations are emerging as rivals with India for outsourcing contracts.
Mark Briggs is chairman and CEO of PremierBPO, headquartered in Clarksville, Tenn., with back offices in Islamabad and Lahore (Pakistan), New Delhi (India), Manila (Philippines) and Tianjin (China). PremierBPO specializes in the financial and cable/satellite industries, account management and collection, medical billing and other areas. Though happy with his Indian labor force, Briggs recognizes that he cannot be complacent when it comes to sourcing.
“Geographic diversity reduces risks for our clients,” Briggs told me. “Regarding Pakistan versus India, both are strong markets for outsourcing and have excellent workforces, but the price value equation seems slightly better in Pakistan as wages in local markets are equal, but the dollar buys more Pakistani rupees than Indian rupees.”
Traditionally, “finance” involves managing money, funds, financial assets or other liquid resources of the business, provisioning banking facilities, obtaining loans or credit, corporate finance (funds or capital), tax management and investment finance. But it can also include debt collection, mortgages, insurance actuaries, securities and more. “Accounting” involves recording, reconciling and summarizing business and financial transactions, analyzing, verifying, and reporting the results, and then furnishing a justifying analysis or explanation.
Melded together for commercial purposes, finance and accounting become “F&A,” an aggregate of associated cross-organizational functions supporting corporate finance and dealing with the financial decisions that corporations make and the tools and analysis they use to make these decisions. The primary goal of corporate finance is to enhance corporate value without taking excessive financial risks. And to do this management requires a sound F&A policy. It’s all about the money.
As a result of the merger of once distinct finance and accounting functions into “F&A,” FAO suppliers reaching into buyer F&A processes to offer outsourcing solutions often find a distinct lack of simplicity and clarity. In addition to general finance and accounting, this vast BPO sub-segment can include areas like compliance management, investment management, banking, mortgage services, insurance, and more.
|
