main index of all writing
articles on IT and computing
articles on general topics

contents | gnulinux | writing | design | workshops | consulting | more                      

HT Horizons

Horizons is a full color supplement on careers and employment, published every Wednesday.

  1. Cinderella with a Computer Mouse

  2. For other columns in Hindustan Times, click here.

Cinderella with a Computer Mouse

How ITES, the neglected sibling of the IT industry, could change your fortunes.

17 July 2002

Wanted: Over 1.1 million Indians. Basic requirement: English-speaking graduates or undergraduates in any field. Age no bar. Sex no bar. Prior skills not necessary. Location: India’s major towns and cities (tier I and II). Note: In some cases, candidates with Ph.Ds or even professional skills and qualifications preferred. How to apply: Scan leading newspapers and job websites for recruitment ads. Job-profile: Providing a huge range of IT-enabled services. Key customers: Companies from all over the world.

If you get the feeling there’s more to IT-enabled services (ITES) than just call-centers and medical transcription services, you are correct. A decade ago they called it body-shopping. Some prefer to call it ‘Remote Processing Services.’ Call it what you will, ITES is the much-neglected Cinderella of the IT-industry. And in a global economy marked with a severe downturn and gloom, the shoe in Prince Charming’s hands only fits her. For ITES is slated to achieve a target of US$ 21 to 24 billion by 2008 for India, according to a recent announcement by Nasscom last month. No wonder the Indian IT industry is abandoning its step-sisterly attitude towards ITES and even exploring the option of getting into this segment, cultural and organizational issues notwithstanding.

Human Touch

That brings us to the overwhelming question: so what is ITES exactly? In the real world, where humans need humans to churn out data for them using computers, ITES is born. Thus, this industry-segment is human-intensive, and India has lots of them, and of all types. Take the example of a US-based research firm that contracted a company in India to create a genomics database for its further advanced research in the field. The Indian firm hired Ph.Ds in biology for the task. Leading Hollywood firms are outsourcing the creation of major chunks of their animation sequences and content-creation to companies in India. Indeed the dynamic range of services within ITES is quite diverse. At one end it includes what we commonly misunderstand as the call center business. In reality these could be contact centers, service centers, customer centers, hotdesks, helplines, technical support centers, reservations operations, sales centers, cyber stores, e-commerce centers, and much more. Beyond the well-known GE Capital and Hughes, several other key players also exist, including Spectramind, Dell, iEnergizer, and many more. All players within this field provide staffers with gracious salaries, comfortable working environments, and in-house training. Yet potential applicants must watch out for the iron-clad contractual agreement, the often odd hours of work, and in some cases, the acquired American accent that needs to be switched off after office hours.

From Pumpkin to BPO

Beyond these customer-interactive services, ITES also includes back office operations for remote customers. Imagine working for a company in the US or Australia, without applying for visas, passports, and leaving India’s ancient shores. What if the company could come to you? Back-office operations within the ITES segment imply just that. British Airways has its reservation system running out of India. All the top international banks channel their data-churning needs to units in India. American Express, HSBC, Standard Chartered, and several more find value in data-analysis, reconciliation, and other services provided on their data from India. This segment is and will remain the highest growth segment within ITES. This year alone, it is estimated to grow at 111% and also provides the largest number of jobs and opportunities. A new term, Business Process Outsourcing, or BPO, evolves from this. Experts feel that once clients feel comfortable and a relationship of trust is established, more value can be derived or generated in outsourcing further aspects of their standard business operations and practices to ITES companies. In the shrinking world thanks to telecommunications, internet, travel and the almost mono-culture that is sweeping the globe, smart companies are finding outsourcing back-office processes, and even their mainstream business processes, the ultimate balance-sheet weapon. Cinderella’s metaphoric pumpkin of back-office processing is turning into the chariot of BPO. It is this new development that jolts core IT companies and makes them want to embrace their neglected sibling.

Age of Contentment?

The new age of technology may well become the new age of irony. For instance, now that all the tools for creating content have been invented, people are needed even more to create and/or analyze that content. Engineering drawings, architectural data, CAD, CAM, 3D modeling, film animation, website development, image processing, and even huge blobs of satellite and other data used in Geophysical Information Systems (GIS), a highly specialized field of computing, needs humans. Some industry pundits predict that the biggest opportunity of this decade may just be the digitizing and converting of all our real world legacy data into digital data. Within this field nascent but significant initiatives are already making their mark. Specialized firms in Pune, Bangalore, Delhi, Mumbai, and other locations are digitizing and creating archival systems of books and literature for large international publishing houses and libraries. Ironic, because all the technology and techniques exist to digitize and encode the languages of the world, but sadly hardly any significant attempts are made in India to digitize its own legacy of literature and knowledge that spans several thousand years. The day this sleeping giant wakes up to its own needs, ITES would remain a sunrise industry-segment for a long time. Pentamedia is among the early pioneers of winning offshore animation projects for India. In the diverse field of content creation, other players include Crest Communications, Rolta, RMSI, Bechtel, Kvaerner, DPSL, MacMillian, and Techbooks, to name a few.

Many dimensions of ITES are still unexplored, perhaps many more are yet to come. Providing learning, training, and education services remotely, for example, holds great promise. Again, of these remote education has tremendous benefits for India as well. Other trends include data conversion, market research analysis using statistical packages in which McKinsey & Co. is quite active in India, and remote network maintenance and monitoring. As is obvious, ITES not only requires a gigantic pool of people, but also a diverse range of skill-sets. Here is an industry that provides jobs as a commodity for a large segment of people who would otherwise find it difficult to find employment. And in the same breath, ITES also provides IT jobs for people with non-IT but highly specialized skill-sets. Each segment therefore has its own salary standards and benchmarks. Since these services are literally IT-enabled, harnessing the power of computing, telecom, and the internet, a basic working knowledge of computers is almost always a pre-requisite. Behold! The computer mouse transforms into a horse to pull Cinderella’s carriage!

The combined impact of ITES delivers quite a punch, and brings new light and hope to India, its people, and its economy. Seeing its potential, the Government in turn provides incentives and support to nurture its growth in India. Most IT-enabled services are exempt from income tax. Over the last few months, dramatic headlines have splashed across the front page and business pages of newspapers on the telecom revolution sweeping India. Few realize and cheer its impact on ITES.

Grim Fairy Tale?

Is the fairy-tale of ITES made of the stuff of dreams? Is it another dotcom bubble waiting to burst after people have invested their life savings into it? Is the media leading us up the garden path once more, only to sell its sensationalized blots of ink on paper? Frankly, it is too early to predict. But some gnawing facts are rather alarming. ITES in India is currently at the more modest turnover of US$ 1.5 billion for the year 2001-2002, and employs around 1,07,000 Indians. In 1999-2000, it employed 45,000 people, and surged to 70,000 in the subsequent year. So within six years, how will it scorch up to 1.1 million people and US$ 21 to 24 billion by 2008? Surprisingly, medical transcription, one of its foremost segments, has already suffered an estimated negative growth rate of 6% this year. Overall, the job-demand in ITES may be high, but the actual career growth, and job-satisfaction may be quite limited for candidates. And finally, if even partly successful, who knows if it will push India’s digital divide further.

Nevertheless, ITES fulfils the pent-up demand for jobs, provides hope in the new world disorder and economic gloom we live in, and positions India in a leadership position. So far, this fairy tale does seem to have a happy ending.

04 February 2003 © niyam bhushan

[ Top ]