BPM sector: Past success and future ambitions

These are interesting times for the Indian Business Process Management (BPM) sector, which is playing a key role in heralding business transformation for global enterprises.

Over the past two decades, Indian BPM sector has made stellar contribution towards strengthening the Indian economy by creating lakhs of jobs and earning precious export revenue. It has inspired several first generation entrepreneurs.

Further, the BPM sector has always done an excellent job of adapting itself to take advantage of prevailing market opportunities.

Whether it’s the strategy to create a mix of off-shore, near-shore and on-shore footprint, changing revenue model from full time equivalent (FTE) to outcome-based, expanding to more verticals, building on domain expertise, leveraging India’s skilled talent base and using India’s technology ingenuity to spur transformation, India’s BPM sector has always pushed the envelope and reinvented itself.

In today’s hyper-competitive business environment, especially noteworthy is the way BPM players are leveraging human talent with advances in technology to drive digital transformation of business processes. As Nasscom points out, we are seeing significant automation in generic services and emergence of a new set of generic processes.

Our expertise in artificial intelligence, robotics, big data, predictive analytics, machine learning, cognitive technology and neuro-linguistic programming (NLP), and deep domain knowledge is opening up new avenues to help clients find untapped opportunities.

The era of cost arbitrage is well behind us. BPM companies have today emerged as transformation partners. Even in the niche customer engagement space, services and technology (machine learning, big data and predictive analytics, NLP) have come together beautifully to solve complex customer problems.

These technologies are redefining customer interactions by predicting customer intent and delighting customers across any channel/touch point, by intervening at the right time and in the right channel. These companies are delivering business impact for their clients by creating opportunities for better revenue realisation, building loyalty and improving retention of customers.

This trend is fueling growth of the Indian BPM sector, which registered a total revenue of $28 billion during 2015-16 fiscal (Nasscom), growing at a compounded annual growth rate of 8%. The sector also accounted for 25% of the total IT-BPM
exports for 2015-16. The employee base has reached a staggering 10,86,000!
The target for the sector is to reach $50 billion in revenues by 2020.

There is indeed no turning back for the Indian BPM sector. From the business perspective, traditional markets such as the US and the UK remain strong. There is tremendous growth opportunity as several large companies are considering outsourcing for the first time and the Asia Pacific region is picking up fast too.

According to the industry reports, India’s domestic BPM market is expected to grow at a compound annual growth rate of 21% over the next five years to reach Rs 50,000 crore in terms of value. BFSI and high-tech/telecom are the two key verticals.

Education, healthcare and government are emerging areas, which are expected to drive additional growth, as India embarks on a digital era, backed by various initiatives of the government.

Given the deep and diverse nature of work that is carried out by the BPM sector today, the skill set required has exceeded far beyond simple English proficiency.

The sector employs highly qualified professionals with advanced degrees in the areas of technology, taxation, and healthcare, among others, who are the domain experts, helping global companies reimagine their business processes to create value and drive competitive business advantage.

As transformation partners, the focus is on helping clients improve bottom lines,
create new growth opportunities and understand their customers better through analytics. With these significant changes underway, BPM organisations have
gone the extra mile to meet career aspirations of its workforce. They are providing ample opportunities for learning and development to reskill, cross-skill and up-skill.

While it has successfully dealt with global disruptions in the past, the BPM sector needs to remain cognizant of the changing socio-political scenario. Protectionist stances in developed economies and political instabilities in Europe and West Asia may create short-term challenges for the BPM sector. The global economic conditions are cyclical as they keep changing — sometimes in our favour or otherwise. Protectionist tendencies will ebb and flow depending on the prevailing political climate.

The BPM sector has to continue to leverage the demographic dividend by skilling our youth through initiatives such as industry-academia partnerships and continuous on-the-job reskilling and upskilling. Automation may result in insignificant job losses in the short run but in the long run, technology always creates more opportunities than it takes away.

Every time the Indian BPM sector has faced challenges, it has triumphed and emerged stronger. This competitive spirit, coupled with technology adoption, will definitely take the Indian BPM sector far ahead of the rest.

(The author is Chief Delivery Officer, India & LatAM, [24]7 Inc.)