BPO E-Sat 2005

• Reasons for leaving weaken as employees begin to take BPO more seriously
• 'Insufficient holidays' the new stress factor; 'Commute time' a
  close second
• Reversal: Higher satisfaction in smaller BPOs
• BPO agents stay happier than IT pros

It's an industry that has been at the forefront of global
attention. It's an industry that has raised more debates and outcry than any
other. It's an industry that has been on democrat candidate John Kerry's
agenda in his presidential campaign in the last US elections. Yes, it is the BPO
industry, which has not only brought jobs to India but has created a whole new
generation of young Indians who service the entire world.

Satisfaction, as they say, can be more relative than anything
else. The BPO industry has been a pioneer of sorts on many people initiatives.
Pickups and drops, office parties, fat paychecks for very young graduates; the
BPO was just another great party till things started looking, well, not so rosy.

The charm and glamour started declining and everyone started
seeing the flipside of the job-never ending night shifts, health problems,
stress and, most importantly, growth. Today, the industry's single-largest
problem is attrition. As BPOs try to get the right pill for their ailments, it
is again the time of the year when we put the average employee and HR managers
in the industry under the lens. The Dataquest-IDC India BPO Employee
Satisfaction Survey, 2005 (we started the exercise only three years back) tried
to find out what it is that satisfies the average young Indian at BPOs.

Mixed Bag

Overall employee satisfaction remains flat this year, which implies that the
statistical significance of the difference in score over the previous year is
negligible. The average E-Sat score this year stands at 80 (on a scale of 100)
as opposed to 80.7 last year. The difference might be irrelevant from the point
of the survey, but what becomes relevant at this point is the commendable
performance on the part of HR managers who managed to nearly freeze satisfaction
levels despite high levels of attrition.

Gecis Global, now Genpact after a rebranding exercise in
September, reenters our survey after a brief hiatus of one year and takes the No
1 slot. The other new entrant this year is Progean, the BPO concern of software
giant Infosys. The results thrown up by the BPO ESat survey 2005 is mixed. The
giants (read Genpact, IBM Daksh and HCL Tech BPO) share the top five slots with
fairly smaller ones like Ajuba and iSeva-all in the sub-1000 employee bracket.
Another important highlight of the survey is that overall satisfaction levels
are far higher in case of smaller outfits as opposed to the Genpacts and IBM
Dakshs. This clearly proves that, gradually, BPOs are moving the software way
with scale increasingly becoming one of the biggest challenges to HR manager.
According to the latest Nasscom-Mckinsey report, the industry needs up to 1
million people by 2008. So, the challenge to keep this huge workforce satisfied
will only continue to head upwards for the employers.

ICICI OneSource, ranked third in terms of size, sees a steep
fall this year. Its overall E-Sat score is 76.06, down 12.5 points from last
year's score of 88.6. Another big player Hinduja TMT, which has been a regular
participant in our survey, also fails to make it to the top five.

The story is not so good for Progean, either. The Infosys-promoted
BPO firm registers a fairly low E-Sat score. Progean also fails to leverage the
Infosys brand name and features fairly low on the 'Dream Company' chart.
Interestingly, all nine existing participants registers a fall in satisfaction
levels this year with IBM Daksh, eFunds and Hinduja TMT falling by nearly 10
points each.

The average E-Sat score of the top five employers (in terms
of size) this year is 78.8, which shows that these BPOs have managed to stay
close to average satisfaction levels in the industry, but slip by nearly 6
points from last year's average of 84.6.

In Search of Growth

Salary, as expected, ceases to be the biggest motivator today. Over 67% of
the respondents (1,053 was the employee base survey) reveal that one of the
chief reasons for joining a company is good work environment. Second on the
preference list is growth opportunity. Over 56% of the respondents say they
would join a company for high growth opportunity. Salary, though third on the
priority list, slips in overall popularity as 37.3% of the respondents voted it
as a key factor of satisfaction as opposed to 56% last year. These revelations,
though similar to what we saw last year, is reflective of the fact that the BPO
industry has matured over the years with employee aspirations matching those in
the more matured industries.

Employers like iSeva, NIIT, Ajuba, eFunds and Motif came
ahead of the other participants to provide a good work environment, with at
least 75% of the respondents voting favorably for these companies. Scale, as we
all know, enhances the opportunities for growth. A significantly large
proportion of the respondents in all the larger companies revealed that high
growth opportunity is a key motivator for joining the company.

Ironically, salary continues to be the chief reason for
changing jobs. Over 57% of the respondents reveal that they would quit for
better paypackets, while 37.3% of the employees surveyed reveal that they would
leave their current organization for a 20% hike in pay.

Pain Points

Stress remains a sore point for the industry. The absence of sufficient
holidays; decline in motivation due to the increasingly repetitive nature of
work; travel time (for example, if you are required to travel from Delhi to
Gurgaon, the distance, just one way, could be as long as 50 km from some parts
of Delhi); timings; and workload were the top five reasons for stress at work,
not in that order. Some other grey areas that are currently lower on the concern
list but could emerge as major pain-points in future are health, a growing area
of concern; long work hours; pressure to perform on metrics; overtime; and
non-negotiable performance metrics.

Health has slowly but steadily emerged to be one of the
biggest challenges for HR managers. Long work hours, night shifts, highly
irregular work hours and physical strain have resulted in various ailments.
Nearly 35% of the respondents complained of sleeping disorders; 26.4% expressed
digestive system-related disorders and over 18% complained of eye problems.

The Lure of Big Bucks

Salary is by far the biggest cause for attrition today. Most HR heads reveal
to Dataquest that a significant share of the employees who quit BPOs actually do
not quit the industry. The movements are largely lateral and remain concentrated
within the industry. Newer companies, especially MNCs and captives, lure
employees with big bucks, while most of the Indian players often fall behind on
this front. Clearly, it is money that is making the BPO world go round.

Moving away from compensation, growth opportunity and higher
education are still some of the other important reasons for those high attrition
numbers. Today, a significant part of the industry is trying to promote growth
to draw people and retain them. One look at the vacancy advertisements across
all national dailies and job sites over the last two years only proves this.
Clearly, employers have realized the hard way that they need to actually provide
a career path and a challenging job profile within the company, to retain people
and grow. And this is the only way the industry will grow.

Bhaswati
Chakravorty

Methodology: Research Design

The survey was designed and carried out in two phases. In the
first phase an HR questionnaire was sent to various BPO companies to get the
company specific data that was to be used in analysis and for devising the
sample break up for each company.

A large-scale survey was then conducted in the second phase
among 1,053 employees in 11 shortlisted companies across the country. The five
major regions covered were: Mumbai, NCR, Chennai, Ahmedabad, and Bangalore. In
each city, a sample quota was assigned based on the company's employee
strength in that city. This quota system was followed strictly to get a proper
representation of the different types of employees in the sample.

The employee survey included only call-floor executives and
operational managers at all levels but excluded back-end support staff from
departments like HR and administration. These interviews were based on a
structured questionnaire that comprised a number of statements classified under
different broad parameters like company culture, job content or growth,
training, salary and compensation, appraisal system, and people. The employees
were asked to rate each of the statements on a 10-point scale. Other than the
above parameters, they were also asked about their salary structure, preferred
company in the industry, overall satisfaction, reasons for joining or wanting to
leave a company, and work-related stress and ailments if any.

A process of cross-checking was established to ensure the
authenticity of data and veracity of the interviews. In order to retain
objectivity, every attempt was made to take an unbiased sample. Every effort was
also made to ensure that the management of the company neither influenced the
employee responses nor got an opportunity to select respondents for the
interviews.

The E-Sat Score 2005

The employee satisfaction score was calculated based on 11 parameters, and
was weighted and indexed on a score of 100. Parameters taken for calculating the
E-Sat scores are:

• Employee size

• Percentage of last salary hike

• Cost to company

• Overall satisfaction score

• Composite satisfaction

• Company culture

• Job content or growth

• Training

• Salary and compensation

• Appraisal system

• People

• Preferred company: Percentage of respondents of a company
  who named their own company as the preferred one

• Dream company: Percentage of respondents in the total sample
  who preferred a particular company

A correlation analysis was run between overall satisfaction and the
statements across all these broad parameters. It gave us the dependency of the
dependent variable (overall satisfaction) on each of these statements, which in
turn provided the weights of each of the statements. The weighted average of the
individual scores of statements gave us the score, at the level of each of these
broad parameters, and this score was used for the final ranking.