BPO Backlash

[Guest]

SAAG has had great writers around like Shri Raman or Arindam or Parthasarthy etc. Hari Sud’s written some good articles before and have also followed his post in different forums. Not sure as to what’s got him lately, in a previous article he had written about <i> India has to thank America for its benevolence for making it as its back office.</i>
I just don’t get it – is anyone doing a favor on India by making it it’s back office?
It’s plain and simple business factors driving such decisions rather than emotions. Even in this latest article at SAAG, methinks he’s on a bit shaky ground. Some of the indicators to raise BPO business in India listed, tantamount to GUBOing. All indicators listed from a US-India centric position. In order for BPO to grow, it would bode well for India to hedge it’s bet by “BPOing” with other nations. It’s a successful business model and can be easily replicated with other nations who are competing with US business.

Sud mentions:

<!--QuoteBegin-->QUOTE<!--QuoteEBegin--> Trade, which currently favors India, should be balanced. India should begin purchases of American goods and services much more keenly.  <!--QuoteEnd--><!--QuoteEEnd-->
Not fully agree with this analysis, way too much US products are sold in India than the other way around. In absence of numbers it’s a bit hard to buy this.

<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->Indian companies beneficiaries of the BPO wave should begin American operation, employing American public. <!--QuoteEnd--><!--QuoteEEnd-->
Trust this is happening, but might take time. Definitely won’t be at level worth mentioning by this Nov’s US election which is primarily driving this backlash.

<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->As a gesture of goodwill, India could make a contribution to the American effort in Iraq, after the UN begins the democratization of the country.<!--QuoteEnd--><!--QuoteEEnd-->
<!--emo&:omg--><img src='style_emoticons/<#EMO_DIR#>/omg.gif' border='0' style='vertical-align:middle' alt='omg.gif' /><!--endemo--> Less said about this the better . Fail to see the connection. Sorry, gestures of goodwill aren’t to be battered away over the lives of soldiers – be it US soldier or Indian. Eye-rak ain't being 'democratized' anytime in near future.

<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->But any relationship has to go through the test of time. Some situations, which could spoil this party, are: 

* US dramatically restrict outsourcing by law.
<!--QuoteEnd--><!--QuoteEEnd-->
Will go out on the limb to say it can't happen. At best there'll be some local legistlaions to prevent govt jobs/business going abroad. Business community just won't let it get to that. And we know as to how tight MNC folks are with powers be. <!--emo&--><img src='style_emoticons/<#EMO_DIR#>/wink.gif' border='0' style='vertical-align:middle' alt='wink.gif' /><!--endemo-->


<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->* India does not act on US request to further tighten high tech exports in nuclear and missile technology.<!--QuoteEnd--><!--QuoteEEnd-->
Err, we are talking about India or Pakistan here? <!--emo&:whistle--><img src='style_emoticons/<#EMO_DIR#>/whistle.gif' border='0' style='vertical-align:middle' alt='whistle.gif' /><!--endemo-->


<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->* Indian costs rise too fast and become prohibitive for outsourcing.  <!--QuoteEnd--><!--QuoteEEnd-->
Possible, but think we have hit the peak. From what I've seen in most of cases, clients in US are the price drivers.

<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->*  Dramatic change in the make up of the government after April 2004 Elections in India.
  * Under any political compulsion, US begin pulling back outsourced jobs.
<!--QuoteEnd--><!--QuoteEEnd-->
Seems like there'll be status quo on Indian front and Eye-rak is lately driving all news cycle in US. So not sure if it's an issue.

<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->  *  No Indo-Pak settlement is reached; hence threat of war is constant on the sub-continent.  <!--QuoteEnd--><!--QuoteEEnd-->
Oh well - cost of doing business. Whatever India does Pakis will around to sour the taste - agreement or no agreement.


<!--QuoteBegin-->QUOTE<!--QuoteEBegin--> This will also plug the gap between shortages of scientific talent in USA <!--QuoteEnd--><!--QuoteEEnd-->
Greenspan had hinted to this in one of his discussions with Congress. Also, had read somewhere that when the tide of baby-boomers retirement hits it’ll in fact benefit US.