BPO Rankings: 13 | EXL Services: Road Less Traveled

No other offshore BPO firm has experienced the kind of ups and
downs that EXL Services has. In its short life span, it has seen allentrepreneurship
to acquisition by a big firm; bankruptcy of the parent to an overwhelming
response to the IPO that was delayed by one and a half years since its first
filing. The annual revenue growth also showed an almost sinusoidal pattern. So
if FY 06 was a year of (by Indian standards) a sluggish 18% growth, last year
was a complete reversal with a robust more than 84% growth. Part of the reason
for this volatility in growth is because of the companys tendency to tread a
different path, which means a lot of experimentation and some amount of tactical
failures before it stabilizes.

More than 70% of EXLs revenue comes from two verticalsfinancial
services and insurance, it being one of the top three offshore firms in the
latter. Considering that it is largely a non-voice player, it was a perfect
precondition for trying out platformizing the offering, like its peers have
done. But EXL chose to take the consulting route. It is probably the only BPO
firm which has significant (7.5%) revenue coming from advisory services,
something that large IT firms are still struggling to achieve.

The other differentiated approach for EXL has been its inorganic
strategy. While topline growth and skills/platform acquisition have been the two
major reasons behind acquisitions in the industry, EXLs acquisition of
Inductisa firm that is into very high-end analytics and algorithm design, and
not just number crunchingwas a strategy of buying value. The research and
analytics share is now more than 13% of its overall revenue, while its
headcount share is just 3%. It also strengthened its client portfolio with the
addition of names like Discover, Amex, and Dun & Bradstreet.

EXL appointed key executives last year including Pramode Metre
as VP, and chief sales and marketing officer; Sridhar Kadaba as VP, risk
advisory services; and Matt Appel as the CFO, even as founder Rohit Kapoor took
on the additional role of chief operating officer. DQ