Grumbling Workers Anxious Boss

Employee satisfaction is a challenge in the IT industry. And the

challenge simply doubles when you talk about the ITeS industry, commonly

referred to as BPO. The manpower base of the BPO industry has increased multiple

times over the last five years. The segment is currently a $5.2 bn industry,

with exports constituting more than 88% of the revenue generated. ITeS is a

growing contributor to the Indian GDP, and its growth is projected at greater

than 38% for FY 2006. The ITeS-BPO industry is expected to require an additional

93,000 people in the next year, showing an increase in labor demand by 29%.

According to studies conducted by Nasscom, the segment is expected to employ

over 1.1 mn Indians by 2008. Put simply, it has been a problem of plenty for the

industry which is trying to cope with high attrition, high stress and low job

satisfaction.

Dip, Dip, Dip



Average satisfaction has slipped this year as compared to last. After
remaining flat for two consecutive years, average satisfaction stands at 66.6, a

dip of over four points. What it means, effectively, is that most initiatives

taken by the industry have not managed to yield the desired results.

Interestingly, if one takes the top 10 companies in the survey,

the average satisfaction index stands at 70.4, which implies that the remaining

10 participants have triggered the fall. All companies in the bottom 10, except

Motif, are new entrants in the survey this year. In fact, 15 of the 20

participants this year are new entrants with only e4e, Genpact, Ajuba, ICICI

OneSource and Motif having been around last year.

Several reasons justify the dip in overall satisfaction levels.

For one, most respondents in the survey (employees) felt that companies are not

living up to the promises in spite of claims in the advertisements. There also

seems to be a loss in pride toward the organization. Second, most employee

issues are not finding immediate response from the respective organizations.

Appraisal systems and parameters are also an area of dissatisfaction as

employees felt that special initiatives and efforts are not taken care of during

the appraisal.

The A-Word



Attrition. It is the single-largest challenge for BPOs, in light of the

innumerable causative variables-behavioral, organizational and industrial.

This challenge is magnified in the offshoring industry on account of the absence

of any historical industry precedence compounded with the typical demographic

profile of the employees, often in their early twenties. However, respondents to

the survey identify three prime reasons to explain the high-attrition

phenomenon, which include perceived lack of growth opportunities in the

organization, migration to more stable work environments and, most importantly,

search for higher pay-scales. Nearly 35% of the respondents said that they would

leave a company for better compensation while nearly 26% cited better growth

opportunity as the reason for joining a new job. According to industry insights,

salary is really a hygiene factor today, which is used more as a reason to

justify frequent job hopping. In reality, the trigger point to join and leave an

organization is not compensation.

To counter each of the above, organizations have been focusing

minutely on designing and implementing best-in-class retention strategies. The

most far reaching yet implicit strategy being adopted by service providers is

that of repositioning the BPO industry as an attractive long-term career option,

so far considered a 'stop-gap' solution for fresh graduates: The target

employee segment. Companies have devised unique strategies to retain employees.

Some of these are defined career paths; tie-ups with educational institutes for

post-graduation programs subsidized by the service-provider; informal anti-poach

agreements with competitors; cross-functional training; performance-linked

remuneration; tenure-linked bonuses; recognition schemes and flexible working

hours.

However, service-providers assert that for the image makeover of

the industry to fructify, solitary efforts are inadequate. The industry needs to

collectively make compelling efforts in this area. In their individual capacity,

however, service-providers are striving to reinforce the power of their brand-an

important pull factor for employees of the industry.

In the same vein, the intent of getting a majority of

organizations to develop an informal "no poaching" agreement is

another retention strategy being deliberated, requiring collaborative effort of

the industry. However, industry experts agree that a more viable model in the

short-term is the signing of bilateral agreements between companies, as

industry-wide agreements may require a longer time frame to materialize.

In keeping with the strategy of positioning the BPO industry as

a serious career option, service-providers have entered into exclusive tie-ups

with educational institutes to provide professional degree courses to their

employees. This allows employees to pursue their academic interests while

employed.

In addition, performance-linked remuneration, transparent

recognition schemes, cross-training etc are other practices being adopted by a

majority of the survey participants.

Reinventing Recruitment



In addition to pursuing innovative retention strategies, the focus is
steadily shifting to ensuring that recruitment processes are aligned with

retention strategies. The effectiveness of any system depends on the quality of

the inputs, in this case the new employees. A few of the participants to the

survey have realized this, and correspondingly made a paradigm shift in their

hiring process by focusing on competency frameworks and other selection

instruments. HR managers and management at the BPOs are taking an active

interest in the recruitment process. An interesting strategy being adopted by a

few companies includes recruiting employees belonging to an older age bracket,

for want of a higher degree of employee stability and commitment.

It is estimated that by the year 2008, India would have

approximately 5 mn people employed by the ITeS industry. Says Piyush Mehta,

senior VP & HR leader, Genpact, "The absence of quality manpower is a

big challenge in addition to attrition." In order to ensure a consistent

flow of trained manpower in the future, the industry is exploring the

possibility of working with the government to introduce courses at a school and

college level, in line with the requirements of the ITeS-BPO industry of India.

Although service providers are focusing on recruitment and

retention of skilled manpower, steps are also being taken to reduce the adverse

impact of attrition on business continuity through building robust processes,

especially with respect to data security, reducing dependency on individuals by

making relationships and processes system-driven rather than person-driven,

increasing back-up bench strength and investing in adequate succession planning.

Killer Stress



Stress is like a ghost that continues to haunt the BPO industry. Long work
hours, night shifts, long travel hours repetitive nature of work and absence of

adequate holidays continue to cripple employees.

Over 31% of respondents complained of long travel time as the

key reason for stress while around 30% blamed work overload. Work timing is a

close third with insufficient holidays and long work hours playing the

spoilsport too. Defends Richa Tripathi, head of HR at Wipro BPO, "Since

ours is a 24x7 industry and we are expected to work on festivals, we ensure that

employees do not lose out on the spirit and fun associated with these

festivals."

But fun or not, stress continues to be a pain point among a

significant proportion of BPO employees. With stress come various ailments. The

most common ailment that afflicted most employees is sleeping disorders,

followed by digestive system disorder, as our survey reveals. A recent report

published by the Delhi Diabetes Research Centre (DDRC) reveals that employees in

call centers are the latest to fall prey to Type II diabetes: increased blood

sugar levels due to unbalanced diet and stress.

Looking Ahead



If outsourcing to India was initially triggered by reasons of quality and
cost, the Indian outsourcing story now has, as its key players, companies that

are fast scaling up to equivalent international standards of innovation,

quality, and productivity-not to mention the educationally- and

technically-qualified talent pool that makes this possible. The fast-growing

industry is ever changing, adapting to new ideas as well as opening new avenues

of operations for multinational companies. How they balance their workforce

challenges with the need for high quality output will decide the future growth

of these companies as well as the growth of the outsourcing concept itself.

Bhaswati Chakravorty





bhaswatic@cybermedia.co.in