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 Home > 10th Anniversary > OFFSHORING: Telecom-Enabled Esrvices
  10TH ANNIVERSARY
OFFSHORING: Telecom-Enabled Esrvices
Improved telecom infrastructure and a huge pool of English-speaking manpower have made India a hub for global offshoring
Shyamanuja Das
Saturday, October 09, 2004

For the first time in the last sixty years or so-since our independence-as a country, we are no more ashamed of our large population. On the contrary, we boast of it. We are genuinely proud of it. Today, if India has successfully positioned itself as the services hub of the world-with a huge TINA factor (there is no alternative) that does not seem to be getting diluted in the near future-it is because of this large population. In less than five years or so, our population has turned from a big liability, which we never failed to blame for all the ills of our society, to our greatest asset.

This is by no means a small feat for a country where, not long back, nothing ever seemed to move forward. The unsung champion of this big change is the availability of seamless global connectivity. Yes, Nasscom may call it the IT enabled services; we may stick to the phrase for politico-economic reasons; but the fact remains that this revolution has happened primarily because of development of telecommunication. It is high time we proclaimed it loud and clear.

The trend itself is not new. Businesses have always strived to maximize efficiency and minimize cost of operation to remain competitive. Developments in technology always serve this basic objective.

The first such big disruption happened after the first phase of Industrial Revolution, when the advent of new transportation technologies like railways made it possible to locate the three components of business-raw material, labor, and the consumer of the finished goods-in different physical locations. First, it happened within political boundaries. Then, with economics getting the better of politics, it became globalized. It is a few years back that we saw some countries like China, Taiwan, and Korea become preferred manufacturing locations for global companies based in North America and Europe, even as Indians kept on debating the ways and means of tapping that opportunity. That never really happened.

However, if every dragon has its day, so does every tiger. Manufacturing was fast being replaced by services as the most dominant business globally, so much so that even manufacturing companies competed on customer service. The services component in some consumer product companies became so significant that for all practical purposes, they turned into services companies. Business became more about exchange of information than anything else, prompting digital-age guru Nicholas Negroponte to call it a shift-from the movement of atoms to movement of bits.

The businesses were just trying to achieve the same old objective-maximize efficiency and minimizing cost of operation to remain competitive.

This time what helped them in achieving this objective was the advent of new telecommunication technologies-making seamless global connectivity a reality. The consumer and provider of services could now be physically miles apart. And the new material-information-could be processed anywhere. That led to the big wave of today: Offshoring.

Because of its unique advantages-history, geography, demography, and politics-India was best poised to tap the opportunity. By an accident of history, India became proficient in English, the language also spoken by the most powerful nation in the world. By geography, it was in a time zone that kept us awake when the Americans slept. What also helped was our large population and the democratic system that made it easier to do business in India.

Opportunity came ringing and we made no mistake this time around.

And look at what this phenomenon has achieved!

It is creating jobs for millions. It has exposed the hidden talent of a developing country like India to the global economy. And today, it is poised to get the most-creamy jobs of the US to India. It has got the talented Indians anywhere in the world contributing directly to the economic development of their motherland. It has, for the first time, made the state governments sensitive to the fact that businesses indeed can help in development, resulting in their developing infrastructure like power and transport, which all of us have benefited from. It has boosted India's image. And one is not even talking of the direct economic benefits and its multiplier effect on the local economy.

One point must be made clear. Telecom made provision of remote services possible. However, what got India the business was not telecom. It was India's manpower-both quality and quantity. If anything, business came to India despite its telecom infrastructure. One would not be too nostalgic to recall those days in 1999 and 2000, when a major task to accomplish for the CEO/COO of a new offshoring startup was to get an international leased circuit between India and US/UK up and running in the minimum time possible. Telecom, very often, featured as a weakness in India's SWOT analysis, though one of the very few ones.

But having said that, it must be acknowledged that, in the last four years or so, that has reversed. Today, telecom is out of the mind of the CEO/COO. It is taken for granted, more or less. Bandwidth is available on demand. Quality of services is far better. The sensitivity of the telecom carrier to the business needs of an offshoring services provider is far better. And so is the responsiveness. To add icing to the cake, prices have constantly fallen.

So today, in 2004, when one makes a SWOT analysis, telecom is listed as a strength. From all the inputs that go into the business of offshoring service provision, the only one that has changed drastically for better is telecom.

And it is not just a feel-good factor. Falling telecom costs have to some extent compensated for rising operational costs in almost every other aspect of the business-manpower, business development, skills development-not to talk of the rising rupee factor.

Ironically, our telecom service providers and even the government that initiated the reforms have never got their due. The government is blamed for not training graduates in BPO-specific skills; for not giving enough tax sops, and so on. But, it has hardly been patted on the back by the business fraternity for making it possible not to worry about telecom.

Yes, there are gaps. Yes, there are miles to go. Even today, the business manager in the offshoring company is planning for the redundancy. Even now, he has not developed that faith in his service provider to take care of his needs as and when needed. Even now, telecom does find a mention as an agenda item in top-level meetings in this business. That may not change for some time now. Because, that IPLC line is the thread to which the survival of this business is tied.

Our telecom men have more or less managed to solve the problems that is directly in their domain. They could, as a challenge, take another problem that is threatening to dilute, if not replace India's TINA positioning in the global outsourcing business. And that is-the manpower situation in the major centers of offshoring in India is fast approaching saturation levels.

Today, manpower is available in many other cities-Jaipur, Chandigarh, Vishakhapatnam, Bhubaneswar, Panaji, and Guwahati. What stops companies from going there is the lack-in many cases perceived-of telecom infrastructure.

How about taking this one, friends? That could help in creating jobs in those locations and more importantly prevent these jobs from going to other countries, while turning John Kerry's impression about Bangalore into a reality.

India could really be a fully wired nation.

Shyamanuja Das

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