School of LAW Faculty of MITTAL SCHOOL OF BUSINESS

Name of the faculty member MS. NANDINI KUNDU

Course Code: HRM201 Course Title: HUMAN RESOURCE MANAGEMENT

Academic Task No: 1 Academic Task Title: ASSIGNMENT

Date of Allotment: 17/8/2020 Date of Submission: 29/8/2020

Student Roll No: A08 Student Reg. No: 11915048

Term: 2 Section: 1902

Max. Marks: 30 Marks Obtained:

Evaluation Parameters

Learning Outcomes: (Student to write briefly about learnings obtained from the academic tasks)

Declaration: I declare that this Assignment is my individual work. I have not copied it from any other
students’ work or from any other source except where due acknowledgement is made explicitly in the
text, nor has any part been written for me by any other person.

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Evaluator’s Comments (For Instructor’s use only):

General Observations Suggestions for Improvement Best part of assignment
 Case 3.

Q1. What environmental factors have contributed to the turning of Indian BPO
industry into an Orwellian eco-system?

In India, Business Process Outsourcing (BPO) is the fastest growing segment of the
ITES (Information Technology Enabled Services) industry. Factors inclusive of
financial system of scale, commercial enterprise threat mitigation, value gain,
utilization improvement and superior competency have all result in the increase of the
Indian BPO industry. Business technique outsourcing in India, which started across
the mid-90s, has now grown via leaps and limits.

The BPO increase in India is credited to reasonably-priced exertions expenses and

India’s big talent pool of skilled, English-speakme specialists. Research by the
National Association of Software Services and Companies (NASSCOM) has found
out that best orientation amongst main BPO organizations, 24/7 services, India’s
precise geographic region and the investor pleasant tax structure in India have all
made the BPO enterprise in India very popular. India is now the arena’s favoured
marketplace for BPO businesses, among other competitors, together with, Australia,
China, Philippines and Ireland.

5 Factors that Affect the BPO Industry

1. Regulatory Environment

This challenge primarily comes from the very nature of outsourcing – finding experts across
the borders that are capable of finishing tasks for your business, but how is this relation
regulated by regulatory bodies in each country?

This has been the primary challenge of the BPO industry ever since it started to exponentially
grow 15 years ago. The USA was among the first countries that have addressed this new legal
issue. Its regulatory bodies have produced many compliance-related documents in order to
make a clear legal frame for outsourcing partners and people working in the outsourcing
industry.
The European Union’s, Philippines’s and India’s regulatory bodies are still working on this
legal frame. Many new regulations are being implemented, but until this is done, the demand
for outsourcing will stagnate.

2. Cost of Doing Business

Since it started growing, the BPO industry was advertised as a huge money-saving
industry. In fact, everywhere you look, you will be able to see a promotion that goes
like this – get access to top talent for a minimal cost. Over time, the BPO industry has
evolved into a serious revenue generating industry, but the budget and cost of doing
business remain the primary concerns for many outsourcing companies.

Outsourcing companies are expected to provide the best results, while the cost of their
services is expected to stay minimal. This puts enormous pressure on the resources of
these companies since they are forced to give their maximum, while the budget has to
remain the same. This leads us to customer expectations and quality of service
provided as the next major challenge.

3. Customer Expectations and Quality of Service

All industries are affected by one major factor – the customer-centric market – and the
BPO industry is no exception. This means that the BPO industry has to provide the
best possible results for the clients. In many cases, outsourcing companies also have to
provide a consult and maintain constant communication with their clients.

Thanks to social media, clients are now very familiar with the best practices in the
BPO industry. This puts tremendous pressure on outsourcing companies, which are
now forced to spread their resources as thin as possible to maintain the required level
of service quality and revenue.

Customer expectations are especially challenging for the outsourcing companies that
have just entered the market. They have to compete with established companies by
 either lowering the cost of their services or decreasing the profit margin to increase the
quality of service by hiring the top talent.

These three factors are not only affecting the BPO industry, but they are also shaping it
and making it more challenging. As you can see, regulatory compliance is still one of
the primary concerns for outsourcing companies, as well as client expectations and
budget.

4. Employee Attrition and Health Concerns

Employee attrition was always one of the primary challenges faced by BPO
companies, even the major ones. And as time passes the attrition rates only get higher.
It seems that that the BPO companies have yet to find out ways to ensure jobs for their
employees.

The scenario repeats itself. BPO companies employ new people, devote time and
resources to enable a smooth onboarding process, the market demand for that specific
work diminishes and BPO companies are forced to let go these employees. This
significantly increases the time and money spent on training the new employees.

In addition, there are also specific health concerns tied to this line of business. As you
know, BPO companies are spread around the globe and they don’t apply any
geographical restrictions when it comes to both their clients and employees. This
means that people working in this industry may be forced to work on an erratic time
table, thus resulting in major health concerns for these employees.

5. Brand Building and Equity

All of the things that we have mentioned so far impact the branding strategy of the
BPO companies and their future on the market. With so many variables in the market,
it becomes next to impossible for BPO companies to develop a long-term branding
strategy, which significantly slows down the brand equity building momentum.

In any case, these companies are forced to invest so much more than the other ones in
their branding efforts if they want to become recognizable on the worldwide BPO
 market. High employee attrition rates result in many unhappy ex-employees, which
increases the chances of negative word-of-mouth.

Maybe this is the reason why there are dozens of BPO companies out there and only a
few of them have established themselves as major players on the market.

In the end, all the players in the BPO industry should consider taking a closer look at
the successful BPO companies and try to give their best to identify which practices
have helped these businesses succeed. Maybe the solution remains hidden in all the
metadata that’s piled up over the years.

Q2. What legal system do you suggest to check fraudulent practices in BPO industry?
Do you think that the present judiciary system, as it is now in place, is adequate to
check such practices?

If the BPO sector is covered by the nation's labour laws, it follows that disputes which arise
in the sector between employees and employers should be settled under the relevant industrial
disputes legislations.

The home front:

Indian regulatory authorities haven't really got around to framing regulations for the BPO
industry.

The main law or regulation that affects BPO companies in India is the Indian IT Act 2000.
Other legal regulations that affect this sector are the Indian Penal Code Act, Consumer
Protection Act 1986, Indian Contract Act 1972, Specific Relief Act 1963, Indian Copyright
Act 2000, and the Product Patent act 2005.

See Table: Indian BPO regulation vis a vis competition from Nasscom's Indian ITES-BPO
fact sheet for more on areas covered by Indian regulations regarding BPOs.

The required technology compliance for BPO companies is limited to copyrights, patents and
data security. These are easily fulfilled as most of these companies comply with BS 7799 and
ISO 17799 that have the required mechanisms built in. The technological readiness of the
Indian BPO industry is at a higher level than what Indian regulations mandate.
BPO companies emphasize data security and integrity. Extensive security policies and proper
configuration right from access level control for data to configuring firewalls and IDS
systems is essential here. These are complemented by regular audit and review mechanisms.
Audits are done at regular intervals by the internal IT team as well as by third party auditors.
Reviews and modifications of the policies are also done if required. This systematic approach
has made their life easier when it comes to conforming to regulations.

Other measures include proper incidence management, and clearly documented and tested
escalation plans. When we go into the specifics, the compliance initiatives of most BPOs
basically include the following: -

• Assessing internal controls

• Managing and optimizing financial reporting processes

• Consolidating information for managing business performance

• Improving business intelligence

• Providing financial models for high-risk operations and programs to manage risk

• Improve records management and audit trail

Ensuring fraud detection and prevention