Outsourcing occurs when a company purchases products or services from an outside supplier,rather than performing the same work

within its own facilities, in order to cut costs.Companies tried to identify or develop a "core competence," a unique combination of experience and expertise that would provide a source of competitive advantage in a given industry. Successful outsourcing requires a strong understanding of the organization's capabilities and future direction. Vendors providing outsourcing services are generally grouped into two models:Business Process Outsourcing (BPO) and Application Service Provider (ASP).

REASONS :
Cost savings -The lowering of the overall cost of the

service to the business. This will involve reducing the scope, defining quality levels, re-pricing, re-negotiation, cost re-structuring. Access to lower cost economies through offshoring called "labor arbitrage" generated by the wage gap between industrialized and developing nations. Focus on Core Business -Resources are focused on developing the core business. Cost restructuring -Operating leverage is a measure that compares fixed costs to variable costs. Outsourcing changes the balance of this ratio by offering a move from fixed to variable cost and also by making variable costs more predictable.

CONTINUE ..

Knowledge -Access to intellectual property and wider

experience and knowledge. Contract -Services will be provided to a legally binding contract with financial penalties and legal redress. This is not the case with internal services. Access to talent -Access to a larger talent pool and a sustainable source of skills, in particular in science and engineering. Capacity management -An improved method of capacity management of services and technology where the risk in providing the excess capacity is borne by the supplier. Improve quality -Achieve a step change in quality through contracting out the service with a new service level agreement.

CONTINUE .

Catalyst for change -An organization can use an

outsourcing agreement as a catalyst for major step change that can not be achieved alone. Enhance capacity for innovation -Companies increasingly use external knowledge service providers to supplement limited in-house capacity for product innovation. Reduce time to market -The acceleration of the development or production of a product through the additional capability brought by the supplier. Commodification -The trend of standardizing business processes, IT Services and application services enabling businesses to intelligently buy at the right price.

CONTINUE ..
Risk management -An approach to risk management

for some types of risks is to partner with an outsourcer who is better able to provide the mitigation. Venture Capital -Some countries match government funds venture capital with private venture capital for startups that start businesses in their country. Tax Benefit -Countries offer tax incentives to move manufacturing operations to counter high corporate taxes within another country

Types of Outsourcing
Technology Services Outsourcing- Companies
that utilize technology require sophisticated, quickresponding computer systems and software that are flexible enough to respond to the increasing capabilities of technology and the rapid changes in business models. Selecting the right technology partner is an integral part of many successful ventures. Electronic Commerce ("eCommerce") Infrastructure ("Networks") Software ("Applications") Telecommunications Website Development & Hosting

CONTINUE..
Business Process Outsourcing- As service
providers witnessed this development, they began to create whole enterprises based on narrow business processes. The term "BPO" (Business Process Outsourcing") was coined in about 1995 and became popular a few years later, accelerated by the explosion of Internet business.
Customer Contact (Customer Relations Management) Equipment Finance / Accounting Human Resources Logistics Procurement / Supply Chain Management Security Human Resources

1. 2. 3. 4. 5. 6. 7. 8.

CONTINUE.
Technology Services Outsourcing - Technological
innovations are fueling the rapid evolution of business and economic models. Companies have to adapt to these changes in order to thrive in a competitive market. Some of these technologies include electronic commerce, network infrastructures, applications, telecommunications and website development. Knowledge Process Outsourcing - It is a more sophisticated level of outsourcing.It involves advanced research, analytical, and technical skills.Eg: Pharmaceutical research and development, intellectual property research, content writing, and database development services.

Business Process Outsourcing- BPO started back in

1995 during the advent of internet business. It involves operational functions such as customer relations management, equipments, accounting, human resources, logistics, procurement, security, documentations, insurance, health care, manufacturing, and media outsourcing. In BPO, specific tasks, especially those outside the core competency of a company, is outsourced to a third-party firm.

CONTINUE.

Knowledge Process Outsourcing1. Market research and analysis These services help the

business extract useful information that reveals current trends and provides inputs for decision-making . 2. Web-based market research These services help collect information from different websites.

Call center outsourcing1. Inbound call center services These typically include

CONTINUE.

answering services . 2. Outbound call center services These include services like telemarketing services, lead generation services, and market intelligence services. Technical helpdesk services This includes technical aftersales support for products and services.

Data Entry Outsourcing1. Online data entry 2. Offline data entry

CONTINUE.
4. IT Sector Outsourcing 5. Healthcare Sector Outsourcing6. Medical transcription services MP3, MPG, MOV, DSS,

WMA, etc 7. Medical coding and billing services 8. Teleradiology services

Financial Sector Outsourcing1. Accounting services 2. Bookkeeping services 3. Financial analysis services

CONTINUE.
Engineering Services Outsourcing- These include a
range of mechanical, civil, structural, and architectural engineering services: 1. Computer aided design (CAD) services to develop prototypes 2. 2D drafting services. 3. Conversion of paper drawings into a digitized format. 4. Design and analysis for residential and industrial buildings . 5. Architectural visualization services (3D rendering or 3D animations) . 6. Services for evaluation and strengthening of deteriorating structures .

Growth of BPO Sector in India

During the first half of 2007 was showing a moderate trend of growth which is registered at 14%. Tech savvy professionals Cost effectiveness Superior competency Business risk mitigation 24 hour service Economy of scale The trends in growth of the BPO sector in India are as follows: 2003 - USD 2.8 billion 2004 - USD 3.9 billion 2005 - USD 5.7 billion

CONTINUE.
Business process outsourcing services in India has witnessed a growth of 70% a year and involves 100,000 people. The major Indian cities like Bangalore, Chennai, Hyderabad, Kolkata, Gurgaon, New Delhi, Noida, Pune, and Mumbai are well known as the business processing hubs in India, offering valuable outsourcing services in India.The main reasons for the growth of business process outsourcing services in India are: Cost Factor Advantage Utilization Improvement Superior Competency Economy of Scale Business Risk Mitigation

Providing inbound customer service, outbound collections, telemarketing, invoice processing, transaction processing, finance and accounting services, and knowledge management of complex technologies. Growth of BPO Sector in India BPOs Role in Indias Economic Growth Challenges before BPOs in India Wipro BPO in India Progeon India Capgemini India Convergys India IBM Daksh India Cognizant India

CONTINUE..

CONTINUE..
Intelenet India BPO Jobs in India

Job Profiles In BPO Sector in India Customer Service Executive Telecallers Account management Support Cast Telecom E-Commerce Call Center Operations Help Desk

ROLE
Company Name (Specialization) Hartron Communications Ltd (Claims Processing, Transaction Processing, Health Insurance, Medical Billing) HCL Technologies BPO Services (Accounting, HR, Contact Center / Customer Care, Transaction Processing, Finance, Payroll, Admin) Gurgaon Location Funding Self # of Emp 200 Clients Hospitals, Physicians and Mortgage companies

Bangalore, Chennai, Noida [Delhi], Belfast [UK], Malaysia

British Telecom

Health Office(India) Pvt.Ltd (Medical Transcriptions, Medical Coding Services, Medical Billing)

Bangalore

Self funded

100

Major US and Australian hospitals

Health Quist (Medical Transcriptions, Inbound / Outbound voice, Medical Coding Services, Medical Billing)

Pune, Iselin (US)

Self

100

US Based clients

CONTINUE
Company Name (Specialization) Heartland (Medical Transcriptions) Location Bangalore, Coimbatore, Delhi Funding 2000 # of Emp Clients

Hero ITES Gurgaon (Tele-Marketing, Contact Center / Customer Care, Customer Acquisition, Lead Generation, Data Validation Services) Hewitt Outsourcing Services{India} (HR)

A division of The Hero Group

1000

Fortune 500 client in US, UK and Australia

Bangalore, A joint venture of View210 Hyderabad, Chennai, India Enterprises Pune, Mumbai, Delhi (VIE) and Hewitt Associates Self Funding 125

Philips, IBM, ICI, Pfizer, BASF, Nokia, MindTree, Bank Muscat are from USA, UK, Canada, Australia and European Countries

Hi-Tech CAD Ahmedabad Services (Engineering Services, CAD/GIS)

Company Name (Specialization)

CONTINUE
Location

Funding

# of Emp

Clients

Hi-Tech Export Ahmedabad (Data Processing / Management, Data Capture & Processing, Email Support, Data Conversion, Data Entry, OCR Services)

Private

200

70% from US, rest from Canada, Europe and Australia

Hi-Tech Infosoft Ahmedabad (Accounting & Finance, Document Management, Animation, Healthcare Claims Processing, Medical Billing)

Self

180

US, UK AND AUSTRALIA BASED CLIENTS

CONTINUE
Company Name (Specialization) Location Funding # of Emp Clients
Chennai HLA Information Technologies Pvt Ltd (Data Processing / Management, Data Capture & Processing, Data Conversion, Document Imaging) Sudarsan Group of Companies 100 Triveni Engineering Management & Services [Chennai],SIS Technologies [New Delhi],, Sudarsan Group Companies, Eastern Clay and Ceramics Limited, West Cost Industrial Gases Limited, Sterling Gases Limited, The Standard Furniture, Sri Kamakshi Agencies (P) Limited, K R V Cardamom Plantation Private Limited, K R V Investments (P) Limited, Madathil Investments, Madathil Coffee Estates Private Limited, Kallipara Estate Private Limited, Sri Atham Estate Private Limited, Aries Plantation Private Limited, Aries Advertising Private Limited, Mannur Ceramic Private Limited