More foreign cos pullout from Indian
BPO plan
India is also no longer leading the pack of most-favoured outsourcing destinations. Instances of foreign firms pulling back the outsourced work are growing. In recent months companies such as Capital One, Dell Computer, Lehman Brothers and AXA have repatriated their backoffice operations from India. Conseco, an American insurance firm, is the latest to join the roster of firms moving back their outsourcing operations. According to reports in foreign media, the list is expected to grow. Conseco had outsourced as many as 800 jobs to India three
years ago. The company then believed that India would provide better customer
services. But that feeling is changing now. Dave White, Consecos senior vice-president of policy services, was quoted in a US daily as saying: We gave it a shot, and it didnt work. Conseco, which sells life, health and annuity policies to middle-income clients, expected to save costs by moving the work to India. Instead, the switch was hurt by 9/11, cultural differences and intense pressure to quickly cut costs, according to officials. Conseco still uses ExlServices, an Indian BPO firm, for 53 insurance operations, which are monitored closely and dont involve public interaction. Should they prove dissatisfactory for one reason or another, theres no reason we cant bring those jobs back as well, Conseco executives were quoted as saying. India has also failed to fare well in high-skilled jobs. Storability Software had tried for three years to outsource and had tried all kinds of models. But nothing has worked so far, according to the company. As of now the company does the work in the US. Indian programmers depth of knowledge in the area we want to build software is not good enough, a company executive was quoted as saying. Indians in the US were also quoted as being against outsourcing high-skilled jobs from India. Hemant Kurande, a Mumbaite and an IIT graduate believes so. As more companies in the US rush to take advantage of Indias ample supply of cheap yet highly-trained workers, even some of the most motivated US firms_ones set up or run by executives born and trained in India_are concluding that the cost advantage does not always justify the effort. Another Indian executive, Dev Ittycheria, chief executive of Bladelogic, a US firm with clients such as General Electric and Sprint, outsourced work to India. But the company later concluded that projects it farmed out could be done faster and at a lower cost in the US. ConnecTerra, a US company based in Cambridge, Massachusets, also tried to outsource programming work to India last year, but gave up later. ConnecTerra designs software to manage data from electronic
devices, such as new radar-based ID tags, that companies can use to track
inventory. Source : Business Standard. Image Source: AFP |
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