Aditya Birla Minacs, the outsourcing arm of the Aditya Birla Group, plans to add at least 4,500 seats globally by the end of the fiscal 2010-11, with maximum seats going to the American region.

The company is now gung-ho about the growth potential of the north American region and the prospects in future. After clients such as General Motors adjusted their businesses during the recession period, which affected Minacs’ revenues in the negative, the company believes that things are looking up.

Deepak J Patel, chief executive officer of Minacs, told Financial Chronicle that North America is the growth area and the focus would continue to be there. “We have around 6,000 seats in America and the potential is for 3,000 more seats, which we plan to add by the end of the next fiscal year,” he said. (more…)

Indian business process outsourcing (BPO) firm Hinduja Global Solutions, Ltd. opened another facility in the Philippines on Friday, bringing its total investments to the country to $35 million. The 3,522-square-meter, 1,000-seat call center at Eastwood Cyberpark in Libis, Quezon City cost $2.5 million.

This complements an existing facility also in Libis, known as HTMT Philippines. Opened in 2004 after the Hinduja Group’s acquisition of Customer Contact Center (C-Cubed), the facility which measures 8,672 square meters and has 2,000 seats is the single largest facility of the group outside India, company officials said.

Hinduja Global Solutions serves 80 clients across the globe and employs over 14,500 across 23 “delivery centers” and offices in the United States, Canada, Europe, Mauritius, India and the Philippines. It also has “strategic working relationship arrangements” with partners in Colombia and China which altogether employ over 1,800 people that serve the South American, Chinese and Japanese markets. (more…)

Controversial American talk show host Rush Limbaugh, who fashions himself as the new ‘face’ of the US Republican Party, has raised another storm by calling workers handling outsourced jobs in India as ’slumdogs’.

Limbaugh, who has been accused of making insensitive remarks from women to disabled to homosexuals, hurled the epithet picked up from the Danny Boyle’s smash-hit film Slumdog Millionaire at a discussion last week on outsourcing of jobs from America.

“There’s a reason (these jobs) aren’t coming back. They’re outsourced for a reason, an economic reason, and they’re not coming back,” Limbaugh said, in response to a caller named Terry from Ohio, who had not even referenced India. (more…)

HCL Technologies said its BPO arm and Ketera Technologies have entered into a strategic alliance to provide source-to-pay  services. Through this partnership with Ketera, HCL BPO will deliver full procurement outsourcing across industry verticals, HCL said in a statement. It added that the platform would help maximise efficiencies, reduce costs, and increase productivity for its clients.

The programme offers mid- and large-size enterprises management solutions to reduce and control corporate spending for direct and indirect goods.

“Ketera creates a source-to-pay loop to identify, capture and sustain bottom line savings with spend analysis, sourcing, procurement, contract management, invoice management and supplier management,” Ketera Chairman of the Board and Chief Executive Officer Stephen Savignano said.

“The services on this platform will help large organisations to strategically outsource, while maintaining mission-critical operations in-house,” HCL Technologies (BPO Services) Head (KPO) S Rajagopal said. Source

BPOM - a full service business process outsourcing company focused on serving middle-market enterprises, today announced financial results for the second quarter and first six months of 2008, the period ended June 30, 2008. The financial results represent the Company’s first quarter with positive EBITDA.
Operational Highlights
– Spiegel Brands, Inc., Chicago, the women’s clothing catalog marketer, signed a multi-year contract for its information technology outsourcing solutions.
– Shasun USA, Inc., one of the world’s largest producers of ibuprofen, signed a multi-year contract for its information technology outsourcing solutions.
– BPOMS signed a strategic relationship agreement with Tectura Corp., a leading Microsoft partner and global services company providing Microsoft-based technology solutions. Under the terms of the agreement, BPOMS will make its human resources outsourcing solutions available to Tectura’s North American clients, which are mid-market companies as well as divisions of larger enterprises.
– Deutsche Rentenversicherung Bund and Deutsche Post Real Estate Germany purchased BPOMS’ Enterprise Content Management (ECM) solution eReview.
– Eastman Kodak has honored BPOMS’ enterprise content management division for outstanding revenue generation and overall sales performance during 2007. In addition, for the fourth time, Kodak named BPOMS the top Canadian reseller of KODAK Service & Support, Eastman Kodak’s worldwide service organization.
– BPOMS’ IT outsourcing solutions division was awarded two key certifications: It successfully completed the 2008 SAS 70 Type II evaluation by Eisner, LLP, an independent service auditor, and also TrustWave’s TrustKeeper(R) Compliance Validation Service to meet the Payment Card Industry Data Security Standards.
– The Company raised $5.6 million in additional financing from the exercise of Warrants to Purchase Shares of BPOMS’ Series D-2 Convertible Preferred Stock.  Full News

The warrants have a strike price of $6 and Global BPO is trading at $7.80, allowing the warrants to have an intrinsic value of $1.80 and time value of another $1.50 for a total of $3.30. However, the warrants only trade for $0.67. There are two main reasons they trade for such a low value, which we’ll get to later, but more importantly, there is a good chance that one of these reasons will no longer be a factor when shareholders approve the pending merger with Stream Holdings on July 29th.

The shareholder vote is important because warrant holders can’t exercise the warrants until shareholders approve an acquisition. Global BPO is a special purpose acquisition company, or “SPAC,” created to find an acquisition in the outsourcing arena. Earlier this year, Global BPO’s management announced a deal to acquire Stream Holdings. The deal looks like it is priced attractively, plus the CEO of Global BPO, Scott Murray, used to run Stream Holdings from 2000-2002 until he sold it to Solectron. Shareholders have a choice to approve the attractively priced acquisition and own shares in the ongoing company or vote against the deal and receive $7.93 in proceeds from the Global BPO’s IPO trust fund.

The recent history of SPAC stock performances after acquisition approval is horrendous, so it had seemed likely that shareholders would vote against the deal and warrant holders would have worthless warrants. However, in early June, Global BPO’s management increased the likelihood of shareholder approval by announcing an interesting deal with Ares Capital, a private equity firm. The deal would have Ares Capital pay $150 million for convertible preferred stock at $8. Global BPO would use the money from Ares to tender for 70% of its publicly-held shares. This event significantly increased the probability that shareholders would approve the deal, but it didn’t make the vote a foregone conclusion. Full News

Earlier this year, Genpact, the largest business process outsourcing (BPO) player in India, gave Harpreet Duggal a new role: responsibility for developing and executing the company’s domestic BPO strategy. Duggal is already well into discussions with potential customers, and is finalizing operating locations. He’s moving fast because Genpact isn’t the only Indian company interested in this space. For many reasons, the domestic BPO market is one that no one can afford to ignore anymore.

Duggal primarily is targeting two sets of potential customers: existing global customers who are looking to increase their presence in India and require the same systems and processes they have elsewhere; and Indian companies with global aspirations, both by way of moving beyond Indian boundaries and by providing a global experience in the Indian market. These require world-class processes and systems. Says an upbeat Duggal: “We believe that India is a very exciting market to be in.”

Having been on the periphery, the domestic BPO business is steadily moving onto everyone’s radar. Companies including IBM Daksh, Firstsource Solutions, MphasiS BPO and Intelenet Global Services are looking to significantly increase their presence. Others, such as Wipro BPO and Infosys BPO, are waiting for the right time to enter the space as part of a total outsourcing solution along with their IT arms. And, firms such as 24/7 Customer have no immediate plans to enter, but are watching the space keenly.

What has brought about this growing interest in India’s BPO market? Industry players and analysts cite multiple factors. These include reduced costs of connectivity, the scorching pace of the Indian economy, the phenomenal growth of companies in sectors including telecommunications and financial services, rising customer expectations, Indian firms’ global aspirations, and global firms entering the Indian market. The changing rupee-dollar equation and the slowdown in the U.S. economy, which is forcing players to look at other markets, have added to the momentum.

University of Pennsylvania’s Wharton School management professor Saikat Chaudhuri says the factors driving that trend are the “tremendous growth” of India’s domestic markets, the slowdown in Western markets, and the dollar’s weakness against the rupee. He notes that a whole new class of medium-sized companies outside of the well-established and large industrial houses like those of Tata, Birla, Ambani or Goenka is looking at farming out noncore activities to increase efficiencies and focus on core competencies. “These companies are becoming customers of Oracle, Cisco, SAP and so forth,” says Chaudhuri. Full News
 

Leaders in the business process outsourcing (BPO) industry tend to be more confident than their counterparts in other industries, according to a global study on leadership development.

BPO leaders were confident because they felt capable of executing their jobs well, said Richard Wellins, senior vice president of Development Dimensions International (DDI), which prepared the “Global Leadership Forecast 2008-2009″ report. This was in stark contrast to the global results that found leaders frustrated, according to Wellins. “Leadership confidence is dropping worldwide. This was leaders rating themselves. It has nose-dived,” he added in an interview.

However, the study found BPO leadership development programs in the country wanting, a summary of the study showed. It found that only 41 percent of senior leaders and 32 percent of HR professionals were satisfied with the quality of their efforts to develop leadership in the BPO industry, a finding in line with global results in other industries.

The BPO portion of the study gathered responses from senior leaders and human resource professionals in 26 BPO firms and was highlighted as part of a partnership with the Business Processing Association of the Philippines (BPAP), a trade organization for BPO companies. Willins pointed out that the study showed little correlation between the economic recession and the confidence of leaders.

Good leaders, he stressed, keep winning despite the “storms.”

Insurance biggie Aviva is to sell off its offshore operations and outsource $1bn worth of back-office work.

The world’s fifth largest insurance group, owner of Norwich Union, struck an eight-year deal with Indian outsourcer WNS Global Services to run its business process outsourcing operations.

Over the next three months about 6,000 staff will be transferred from offshore arm Aviva Global Services (AGS) to WNS, which will take over five AGS centres in India and Sri Lanka. Aviva will withdraw from running the centres offshore after spending five years building them up.

The company said the move will protect it against rising inflation and fluctuating exchange rates.

It is understood that some areas of work, such as property claim call centres and direct sales, could now be brought back to the UK.

A spokesman for Aviva told silicon.com: “It is a process of simplifying and improving the services.

“We get the benefit of continued supply and expertise but with better protection from inflation and exchange rates. You are taking the risk out of running the contract.”

The company says the deal will help it realise aims to streamline the business under its ‘One Aviva, twice the value’ vision.

WNS, a former offshore offshoot of British Airways, has provided BPO services to Aviva since 2004 and will provide BPO services to Aviva’s UK and Canadian businesses under the new deal.

WNS will provide life and general insurance processing functions including policy administration and settlement, finance and accounting, customer care and other support services.

Neeraj Bhargava, CEO of WNS, said in a statement: “We also see significant potential to grow our business with Aviva, not only outside the UK, Canada and Ireland, which AGS serves today, but also in new high growth areas such as analytics.”

Financial services knowledge process outsourcing (KPO) industry is expected to be worth $5 billion by 2010, a study by KPMG said.

Sharing his views on the report, Pradeep Udhas, Global Partner-in-Charge, Sourcing Advisory, KPMG, has said that the success in offshoring business operations has encouraged many multinationals to start outsourcing key business processes and high-end knowledge work. The KPO phenomenon will have far reaching consequences for the global financial services industry over the next three years.

He feels that there is likely to be a significant shift in the boundaries between ‘outsourceable and ‘non-outsourceable activities; offshoring strategies are expected to embrace new locations and most global banks and insurers are expected to adopt KPO strategies, the study says.

Decisions about outsourcing may be accelerated to preserve and increase competitive advantage; boutique providers will leverage KPO to create new services and offerings and more rigorous regulatory and compliance control will likely be demanded as KPO providers deliver more complex services.

(more…)