‘Do­mes­tic BPM Mar­ket may Grow 21%’

In­dus­try body says, sec­tor could gen­er­ate over 3-lakh jobs for 3rd party BPM providers in 5 yrs

The Economic Times - - Disruption: - Neha.Alawadhi@ times­group.com

New Delhi: The do­mes­tic busi­ness process man­age­ment (BPM) mar­ket could grow at a com­pound an­nual growth rate of 21% over the next five years to .₹ 50,000 crore, gen­er­at­ing over 3-lakh ad­di­tional job op­por­tu­ni­ties for third party BPM providers even as they move to tier-III and tier-IV cities, ac­cord­ing to Na­tional as­so­ci­a­tion of Soft­ware and Ser­vices Com­pa­nies’ (Nasscom) “Do­mes­tic BPM Mar­ket 2016” re­port. The In­dian BPM mar­ket is ex­pected to record rev­enue of .₹ 23,500 crore in 2015-16, with the third party BPM in­dus­try em­ploy­ing 2,40,000 peo­ple.

The largest sec­tors ser­viced by the BPM in­dus­try last year were BFSI and tele­com, each con­sti­tut­ing 35% of the rev­enue, while travel and leisure con­sti­tuted 10%, re­tail 6%, and govern­ment 5%.

The in­dus­try body, how­ever, stressed the need for greater in­volve­ment and sup­port from the govern­ment. “We be­lieve that the govern­ment can play a cru­cial role in un­lock­ing the true po­ten­tial of the do­mes­tic BPM mar­ket over the next five years,” said the re­port.

It iden­ti­fied ecom­merce and govern­ment, as the fastest grow­ing ver­ti­cals, as the BPM in­dus­try moves to tier-III and tier-IV cities. The govern­ment has a key role to play in the ex­pan­sion of the BPM sec­tor into th­ese smaller cities, noted the re­port. The key fo­cus ar­eas it iden­ti­fies for the govern­ment in­clude in­fras­truc­ture de­vel­op­ment, skill de­vel­op­ment, build­ing pol­icy frame­works to en­cour­age em­ploy­ment and bet­ter in­fras­truc­ture, and also help build con­fi­dence in the sec­tor through aware­ness cam­paigns and set­ting up State level BPOs.

At present, the top 15 BPM play­ers ac­count for 80% of the to­tal do­mes­tic third-party BPM mar­ket, and one fourth of the do­mes­tic BPM mar­ket is ser­viced by third­party BPM com­pa­nies.

The non-voice pro­cesses, in­clud­ing back­end pro­cess­ing, ac­counted for 51% of the do­mes­tic BPM mar­ket. Voice con­sti­tuted 30%, knowl­edge ser­vices was 8%, fi­nance and ac­count­ing 6%, and HR and pro­cure­ment to­gether ac­counted for 5%.

Non-voice pro­cesses are likely to grow faster than voice pro­cesses go­ing for­ward, the re­port added.

It fur­ther said that knowl­edge process out­sourc­ing was still not hap­pen­ing much as it re­quires pre­mium skills that re­quire skilled ta­lent, and hence ex­pen­sive work­force which “come at a pre­mium price that do­mes­tic buy­ers are not will­ing to pay, at least in the short term”, the re­port noted. As firms move more and more into smaller towns, there is an in­creased fo­cus on re­gional and lo­cal lan­guage skills.

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