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Initially when we started out, the prime task before all of us was to sell India and to sell our capabilities. It was no surprise then that strategic issues almost always meant client acquisitions. Having established India as the preferred offshore destination, the challenge now is to retain those clients. That requires a somewhat different outlook towards what we call strategic issues. Today, quality of service delivery is steadily replacing client acquisition as the most important challenge.

This has become imperative because many other countries have woken up to the opportunity and we can no longer sell ourselves with the twin-advantages of English and low costs. BPO companies are now realizing that excellence in operation is the need of the hour—arising out of adequate and skilled manpower, low defect rates, consistency in services and customer-oriented quality processes.

The most important issue is to maintain quality of business processes. With tight timelines and costs, many tend to ignore issues that affect service delivery. Constant review, redefining of business processes and educating employees about quality are important.

Addressing the high attrition rates is also of prime importance. As Indian companies move up the value chain towards providing high-end services, training costs increase proportionately. The industry’s average cost of training an employee is Rs 30,000. For more complex jobs like claims processing, the cost could go up by as much as three times. Hence, the cost of attrition will be three times more severe in this case. Rapid attrition also mean that client requirements can always be endangered and the quality of service affected.

Another major challenges is the ‘span of control’ that is peculiar to this industry. The age levels of middle management in the industry is getting lower by the day. People who are 30 years old or even younger are frequently given the task of managing huge teams, often more than 100 people. If you have peers with the same or maybe even less experience leading teams, it can cause resentment among other team members. The key to addressing this is by developing leadership skills through constant training. Companies should realize that developing soft skills is as important as developing work skills and should invest in leadership development of its manpower.Every second of every minute of the employees’ working day is monitored. No other job is subject to measurement of this extreme nature. Combine this with the fact that, many people do not feel that what they do has any real value for them or for the organization. Therefore, it is critical to motivate employees and make them feel valuable when they are and to help them become valuable when they aren’t.

The cultural divide between employees and the market they address, also poses a greater challenge for effective service delivery. BPO companies need to disseminate information through books, magazines, audio-tapes, videos and workshops to sensitize the employees on the cultures of markets served.

The investment on technology and infrastructure should foresee sustainability of operations and be based on the business plan. Timely upgradation of technology is critical to maintain and ramp-up productivity. Technology deployed needs to be effectively utilized to improve productivity. As the cost factor continues to be a critical issue, the trend of moving the infrastructure to B-class cities and yet maintaining quality of service deliveries is a welcome factor.

Above all,companies in the BPO industry need to look within themselves too. Time and again, Indian companies have blown away a good opportunity to nurture a great industry because of their desire to build it too big, too soon. Companies have been known to grossly underestimate their own costs and offer prices that are not sustainable in the long run. This not only causes a bitter experience for the client when he finds quality levels not meeting the expectations, but the company itself finds the business unviable and has no option but to pull out. The end result is unhappy clients and the risk of ruining a brand that takes years to build.

To guard against this, companies need to be realistic about the growth rates they can achieve and have clear expectations set amongst their shareholders, clients and employees on achieving goals. True sustainable growth can only be achieved by a combination of providing continuous value addition to customers through the four factors of quality, reliability, productivity and price.