In India, BPO has long been eclipsed by its more successful cousin, IT outsourcing. But that could change in the coming months.
As I blogged several weeks ago, the Everest Group and India's National Association of Software and Services Companies (Nasscom) are predicting that the country's BPO industry could grow nearly five times over between now and 20012, possibly reaching revenues of $50 billion.
BPO is growing at a compound annual growth rate (CAGR) of 37 percent, compared to a 28 percent CAGR for IT outsourcing, reports the Business Standard. It accounts for 27 percent of India's export market for software and services, vs. 57 percent for IT services and 15 percent for software development/licensing.
Like their IT outsourcing counterparts, India's BPO specialists are expanding into other countries, to better meet the varying needs of clients and also to reduce business risks, such as those posed by the damaged underseas cables that resulted in outages for some of India's call centers.
Though BPO providers are more likely to suffer a negative business impact resulting from theU.S. subprime mortgage crisis -- several of them reported lower earnings in 2007's fourth quarter due to the crisis -- Nasscom still is bullish on the overall outlook for BPO, due to what it says is growing interest in outsourcing services such as procurement, human resources management and finance and accounting (F&A).
The VP of Infosys BPO tells The Economic Times that its clients are increasingly interested in deals that encompass several areas of BPO and/or that combine operations and technology, as well as in more sophisticated capabilities such as research and analysis.
All of these trends are mentioned in a CFO.com article that is similarly optimistic about the outlook for BPO. According to two A.T. Kearney analysts cited in the article, the emerging BPO trends to watch are: