Market Volatility Turns BPOs To 'Switch On' And 'Switch Off' IT

The outlook for the Indian ITeS sector is expected to remain cautiously optimistic with growth potential juxtaposed against the prevailing backdrop of macro economic conditions across U.S. and Europe, diminishing margins and aggressive competition from emerging BPO destinations.

While a lot depends on how the looming uncertainty pans out in the near-term, these Indian BPOs are at the same time not compromising on their preparedness for long-term growth, and in some cases have aggressive expansion plans lined up. This is demanding Indian BPO CIOs to stay agile as they face the daunting task of creating an internal IT framework that can support expansion but at the same time also respond quickly to macro-economic uncertainties. According to Siddharth Pai, Partner, ISG Group (formerly TPI), the situation demands CIOs to be nimble and quick in responding to the macro economic environment given the uncertainty in the Eurozone.

According to Anantha Radhakrishnan, VP, Head–Business Transformation Services, Customer Services and Technology Services, Infosys BPO, the time is of cautious optimism because there continues to be uncertainty due to the slowdown in decision-making, but there is an upbeat feeling because the premium on business value, efficiency and innovation is extremely high.

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The onus for not only supporting expansion (both geographic and services expansion) but also delivering that much-needed business value and differentiator is increasingly coming on the IT departments. And, CIOs are realising the role that they will need to play in driving the business plans and strategy to fruition. Take for instance the case of Aegis, one of the leading BPOs. According to Rahul Kamalakar, CIO of Aegis, the company plans to launch at least three new radically different service offerings and all these offerings are based on a strong technology backbone.

“The IT infrastructure and support and skill requirements have to be aligned together to make sure that the business has the desired set up ready to roll out the services,” points out Sachin Jain, CIO, Evalueserve

Cloud And Virtualisation Enable ‘Switch On And Off’

As we step into a year that carries the baggage of volatility from the previous one, Pai suggests CIOs should be flexible enough to turn on and turn off the speed of delivering IT support and resources depending on what happens in the macro economic environment. Cloud and virtualisation meet this demand perfectly.

As a result, CIOs of BPO companies are eyeing these two technology areas to support the business rollouts - be it opening new operation centres in new geographies or launching additional Line of Businesses (LoBs).

The business will strongly push CIOs towards adopting cloud technologies, forecasts Pai of ISG Group. As a result, the movement of enterprise level architectures, IT systems and the way it is being delivered will change. Along with IT infrastructure, the application infrastructure will also move to the cloud.

Virtualisation and cloud computing figure in Aegis’ list of technologies to be adopted this year. With over 900 servers, 1.4 Petabytes storage and 31000 desktops, Aegis has lined up a host of initiatives for this year to meet its expansion programs. “We have signed global contract with Citrix for virtualisation of servers and desktops across all countries we operate. This is currently under implementation,” says Kamalakar.

Virtualised desktop environment offers instant access to relevant applications and authorised information on the cloud without incurring additional cost for desktop upgrades. Aegis’ clients will benefit from virtualised server environment that offers lower operating costs, built-in redundancies and seamless failovers. Additionally, this approach will also enable elevated end-point security and inherent compliance to InfoSec frameworks such as PCI-DSS and SAS-70.

Some technology-led innovative services at the cusp of roll-out at Aegis are strong business analytics tool to give complete control of any business aspect across geographies and functions, video supported self-help touch screen kiosks that will be an extension of the contact centre and a social media monitoring tool. “These will be disruptive offerings that will enable us to maintain lead in the ‘customer experience’ domain,” says Kamalakar.

On the other hand, Evalueserve, a leading KPO firm kicked off its virtualisation and cloud journey as part of its business process re-engineering exercise in 2011. Evalueserve will also continue on the cloud and virtualisation journey. “In 2011, we undertook a lot of changes towards our first step on the cloud journey. We did virtualisation in a big way. As part of our cloud strategy in 2012, we are thinking of providing innovative customer delivery modules using the cloud model,” says Jain.

The company is also planning to launch new applications to automate some of the employee-facing processes to increase efficiency. Knowledge management and collaboration tools will be refreshed and improved upon.

Infosys BPO also sees strong promise in virtualisation and cloud technology. “We are taking virtualisation to the next level to maximise usage of our infrastructure for delivering business processes. Private cloud within the corporation, ‘Access clouds’ as we call them, help in solution development, which has helped us create new business models by delivering business processes on cloud. We try to enhance user experience at all times, whether it’s our agents or clients by using thin clients, mobile-based device offerings or self-service portals,” Radhakrishnan informs.