Grab an Italian masterpiece for less
Not much is left to chance in LogicaCMG's call centre headquarters in Bangalore. Given the threats that face India's outsourcing industry, that is just as well.
Everywhere in the brand new building there are flow-charts, printed out in the company’s signature yellow and black, and pinned to the walls. There are flowcharts showing productivity targets for the centre's 4,000 staff and re-vamped business plans. There are pie-charts mapping staff churn rates running at around 14 per cent – much lower than in similar centres in the UK – and posters, made by the employees themselves, urging workers to "serve from the heart". In the human resources department there is a diagram shaped like a lotus flower that lays out the company's corporate values. Somewhere, no doubt, there is flowchart that describes the optimum process for producing a flowchart.
Such enthusiasm for meticulous planning has served the Indian IT industry well, even if the same attention to detail is not found in Bangalore’s crumbling infrastructure. As you crawl down the grid-locked Hosur Road, it is impossible to miss the signs of Bangalore's economic expansion. Construction work on the city’s emerging high-rise offices and luxury hotels (the third most expensive in the world) continues apace.
In their call centre, LogicaCMG's workers are keen to impress on western journalists just how much they value their jobs. Naveen Rajasekharan, a 22-year-old graduate, heads a small team that takes calls from customers of Thomsonfly, the British budget airline. He beams as he describes the "aspirational" career path he has chosen. He has been the driving force behind the "serve from the heart" posters dotted around the building, he explains. "Logica has been very good to me, and I want to work hard to repay that," he says.
The sentiment appears genuine. But then, the call centre’s staff are under constant surveillance from closed-circuit television cameras. The emphasis on security is a reminder of the damaging coverage the Indian IT sector attracted earlier this year when a British journalist was able to buy thousands of personal details from a call centre employee. According to Rahul Patwardhan, the LogicaCMG executive in charge of the Bangalore operation, "security is the one issue that could threaten to de-rail India’s IT success". Throughout our press visit, we are forbidden from taking photographs.
Mr Patwardhan adds that the Bangalore centre’s success has been built on a combination of "reliability and low costs" in a globalised market. Only months after the building was completed there are plans to extend it. "This is global production," Mr Patwardhan says. "The need to find talent and to tap into it all over the world is clear."
His low overheads will be safeguarded by India's massive pool of labour, which will cap wage costs, he says. The country will produce 400,000 engineering graduates this year (China will produce only one-tenth of that number) and Mr Patwardhan points out that LogicaCMG has received around 40,000 job applications in the past three months. How do you interview 40,000 applicants? By outsourcing, of course.
However, there are signs that India's outsourcing industry is going to have to shift its focus to continue its growth. Datamonitor, the market analysts, recently reported that the value of outsourcing deals signed in India plummeted by one-third, year-on-year, in the three months to September, from £24.5 billion to £16.7 billion.
Such has been western companies' rush to offshore jobs, the call centre market is becoming saturated. Meanwhile, IT wages are increasing by around 15 per cent across India. Indian companies such as Tata Consulting Services (TCS), India’s largest IT consultancy, say that on the global stage, India has to protect itself against relying on "commodity" services - and being undercut by cheaper rivals emerging in the Philippines, South Africa and Latin America.
The buzz phrase in Bangalore is "moving up the value chain" – away from being a source of cheap labour to be leveraged in "cost arbitrage" plays, towards more sophisticated higher-margin work, Subramanian Ramadorai, the chief executive of TCS and chairman of the Indian IT trade body Nasscom, says.
However, India’s tentative steps up the value ladder risk provoking storms of protest from western professionals. Already, American businesses send digital copies of tax returns to India to be processed by trained accountants there. X-rays from western hospitals are sent to be analysed by Indian radiographers. Resistance to the export of such white-collar jobs has already emerged. Last year, for example, the National Union of Journalists wrote to Tom Glocer, the head of Reuters, demanding that the news agency abandons its plan to outsource jobs (mainly processing data from the stock markets) from Britain to India.
Where does that leave the outsourcers?
In LogicaCMG's Bangalore call centre, one of Mr Patwardhan’s slides shows a chart that maps out the cultural differences that his employees must grasp between India and Britain. One of the most telling contrasts is between India’s focus on process and Britain's pragmatism. India’s executives are already being realistic about the importance of making their outsourcing businesses flexible to tackle the future. But given the obstacles that stand in their ways, that fondness for planning – and flow charts – might also just pay dividends yet.
Rhys Blakely visited Bangalore courtesy of British Airways
Articles from our sister site WSJ.com:
You may be asked to subscribe to read certain articles
Industry sectors news at a glance. Interactive heatmap, video and podcast
Everything the Business Traveller needs to know to make a better trip
Get ready for the winter sports season, with our resort guides and snow reports
We are backing British business, what is the confidence of the nation and what businesses are succeeding?
Growing demand for energy, oil that is harder to reach and the rise of carbon dioxide emissions. We examine the energy challenge
With rail travel in Europe on the rise, we review the benefits of travelling by train
Enjoy further reading from Travel to Fashion, Business to Sport, discover more
Shortcuts to help you find sections and articles
1998
£47,955
12 months for the price of 11 and a 5% discount.
Offer ends 31/11/09
Check your free Experian credit report before applying
Car Insurance
to £60K + bonus (OTE £90k)
Lord Search & Selection
Location Flexible
PwC’s Consulting practice helps businesses of all shapes
and sizes work smarter and grow faster.
£85k
CPA
Highly Competitve
Specsavers
Whiteley, near Southampton
Moments from Battersea Park.
For sale with Winkworth
Find out about shared ownership.
See your free Experian credit report beforehand
Book now & save over £100pp.
11 cool resorts, lowest prices... Early Booking offers 15 Nov.
20% off selected Azores holidays taken in October with Sunvil Discovery
Get covered on your travels with a superb range of policies at great prices. Visit InsureandGo.com
World Class Golf, Spa and preferential Beach Club. Private estate overlooking West Coast
Villas from £275 per night inclusive of Golf
Contact our advertising team for advertising and sponsorship in Times Online, The Times and The Sunday Times, or place your advertisement.
Times Online Services: Dating | Jobs | Property Search | Used Cars | Holidays | Births, Marriages, Deaths | Subscriptions | E-paper
News International associated websites: Globrix Property Search | Milkround
Copyright 2009 Times Newspapers Ltd.
This service is provided on Times Newspapers' standard Terms and Conditions. Please read our Privacy Policy.To inquire about a licence to reproduce material from Times Online, The Times or The Sunday Times, click here.This website is published by a member of the News International Group. News International Limited, 1 Virginia St, London E98 1XY, is the holding company for the News International group and is registered in England No 81701. VAT number GB 243 8054 69.