FirstGen Indian BPOs Losing their Identity

BPO, Daksh, Wipro BPO, SpectraMind

The inevitable has finally happened. After its acquisition by IBM, close to 7 years back, Daksh is finally losing its identity to become part of the broader IBM BPO services unit. This change would result in not only the Daksh name being dropped, it would mark a positioning shift with India becoming just another country for IBM BPO, headed by a country manager. IBM veteran and former head of HR for IBM India, Pari Sadasivan would take up that position, according to IBM.

The loss of Daksh identity, however, is not an isolated example.

Ironic it may sound but the same decade that saw the emergence of the BPO phenomenon also sawby the end of itthe loss of identity of most of the early entrepreneurial BPO ventures. From around a dozen third party BPO startups that were operational at the beginning of the decade, only a few have managed to retain their identity, many at the cost of growth.

The first major acquisition in the industry was that of SpectraMind by Wipro in 2002. It operated as Wipro SpectraMind for sometime, but finally changed the name to Wipro BPO in 2005. SpectraMind was one of the first entrepreneurial BPO ventures, started in India by Raman Roy in 1999, who had built offshore capability for Amex and GE.

The other BPO ventures that started in 1999 include GTL, which got out of BPO business in 2007; Exl Service which was sold to insurance company Conseco in 2001, but regained independence through an MBO in 2002. Since then, it has been listed in Nasdaq. It is probably the only company that has managed significant growth without losing its identity.

The other BPO ventures that started in 1999/2000, which have kept their identity intact are vCustomer (started in 1999), 24/7 Customer (started in 2000), have not grown as much as their peers. Interestingly, one more pioneering company that has changed ownership multiple times, but has managed to keep its original name is Intelenet. Started in 2000 as a 50:50 joint venture between TCS and HDFC, it saw TCS exiting the venture and HDFC selling part of it to Barclays. Finally, Blackstone group acquired a majority stake in the company in a management buyout in 2007.

However, most other BPO companies that started in 1999/2000 either do not retain their identities, or do not exist any more.

While the industry kept debating whether the independent BPO companies have a future of their own, the trend shows that the IT companies would have decisively won the debate, but for the former captives like GEs GE Capital International Services and British Airways World Network Services.

Shyamanuja Das
shyamanujad@cybermedia.co.in