5210566 Knowledge Process Outsourcing
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Transcript of 5210566 Knowledge Process Outsourcing
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KPO(KNOWLEDGE PROCESS OUTSOURCING)
The next big
opportunityPresented By
Sanjeev Prasad
Akhilesh Mishra
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Paradigm shifts taking place in various facets of MBA education.
Earlier Now
Production and Operations
Management
ERP, CRM, SCM and IT enabled
manufacturing.
Marketing Management E-business, E-com, planningweb enabled marketing, globalinternational business, B2Band B2C market places andCyber exchanges etc;
Human ResourcesManagement
E-HRM, outsourced web basedHR management, DistributedHRM etc;
Finance Management Globalized economy, E-enabledfinancial data bases, IT in
markets management etc;
Systems Management ICE or IT Technologycomponents, Networking, Sunand Microsoft and otherTechnologies, IT management,Knowledge management,
Business Intelligence etc.
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THE VALUE CHAIN
CEO
Sr. Executives/MANAGERS
KPO
BPO
CALL CENTRE EXECUTIVE
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BPO KPOIt provides services like customer
care, technical support through
voice processes, tele-marketing,
sales, etc.
yLow end services
yProcess expertise
yPre-defined processes
yIt employees not- so- qualifiedworkers as it focuses on
communication skills
KPO provides in-depth
knowledge, expertise and
analysis on complex areas like
Legal Services, Business &Market Research, etc.
yHigh end services
yKnowledge expertise
yRequires application,
understanding of business andanalytical bent of mind
It involves skill and expertise of
knowledge workers with
excellent educational
background.
Difference between KPOs and BPOs:We can say that KPOs emerged from BPOs.
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The kind of job it entails
content development
market research
equity research
data researchdatabase creation
analytical services
financial modeling
design and development in industries
remote educationpublishing and legal support
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How it can make India a global player
Large talent pools and favorable government policies together make
India the most conducive environment for KPO
Several global players such as McKinsey, Reuters, Harris Interactive
and Ipsos among others are already investing in India.
As with the BPO sector, India is cost-effective and provides a vast
intellectual talent with expertise in areas such as research andanalysis.
These companies outsource their processes to India for:
Cost savingsOperational efficiencies
Access to highly skilled workforce
Improved quality
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Why KPO ?
KPO is a quick-money sectorprovides long-term career option
good performers have tremendous opportunity for growth insalary package,favorable business environmentGovernments Policy decision encourage this sectorStrong requirement of Well-educated, knowledgeable,
analytical candidates
HISTORY of KPO Sector in INDIA
KPOs have evolved from BPOs.KPO
s were introduced in India by McK
insey when it first setup a knowledge center in India in 1987.But KPOs actually started coming up in India in 2000 whenmany companies like OfficeTiger, GE, Gartner, etc openedtheir research centers here. From 2000 to 2005, KPOs were in
their growing stage. And during this duration, India became a
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Skills KPOs are looking for:
Analytical skills for analyzing data.
Usage of resources for information researchMaking presentable reports from raw dataTheoretical and conceptualization knowledgeComputer proficiency (software and hardware devices)English Speaking/writing skills
To collate, synthesis, analyze interpret Data and InformationTo Search for advance informationTo Generate various scenarios, judgments and decision MakingHigh level of ConceptualizationTeam Work
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The following are the areas associated with the KPO sector.
Business and Technical Analysis
Business & Market, Equity ResearchData Analytics
Financial Consultancy and Services
Intellectual Property (IP) Research
Learning Solutions
Legal Services
Database Creation
Network Management
Financial Modelling
Research & DevelopmentTraining & Consultancy
Writing & Content Development
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Strengths
yLarge talented poolyQuality IT trainingyLow labour costsySuccess of BPOsyGood knowledge of projectmanagement skillsySupportive government policiesyMany new areas of specialization are
being covered making KPO sectorspreading its wingsyConsideration to quality standardslike ISO 900x and Six SigmayBilling rates are lower as compared tobilling rates in other countries
Weaknesses
Immoral and unethical practicesrelated to handling of crucial data
Rising wages The inability to uniformly develop andprovide infrastructural requirements asreal estate prices are rising in majorcities. Inadequate Intellectual Property
Rights (IPR) protection regime in India Billing rates are higher as comparedto billing rates in BPOs
OpportunitiesyIncreasing domain expertiseyMore areas of specialization can beadded to KPOsyAmple opportunities for SMEs
ThreatsyNon retention of talentyExpected labour supply gap as jobsgrow faster than the workforce.
SWOT ANALYSIS
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KPO OPPURTUNITIES IN THE FOLLOWING SECTORS
RETAIL
E-MARKETING
BUSINESS & TECHNICAL ANALYSIS
LEARNING SOLUTION
DATA ANALYTICS
INTELLECTUAL PROPERTY RIGHTSINVESTMENT RESEARCH
LEGAL & INSURANCE CLAIMS
PATENT FILINGS
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HIGHEST PAYING KPO FIRMSGold mans sachs bangalore
Deutsche bank bombay
UBS hyderabad
SBI capital
JP morgan chase bombay
Kotak bank bombay
ICICI bombayEvalueserve delhi
Genpact
WNS
Copal partners
Lehman brothers bombayLozenge Consultancy Services
Patni Computer Systems
Hutchison Essar
Hector & Streak
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Unlike conventional BPO where the focus is on process expertise, in KPO,the focus is on knowledge expertise.
KPO involves business processes requiring domain expertise and high-endqualifications such as the MBA and/or the engineering, medical, law,accountant degree or other highly skilled professional qualifications.
KPO requires moving away from the simple execution of standardisedprocesses to the implementation of processes that demand advanced
analytical and technical skills together with some decision-making.
India, China, Russia, Canada, Israel and the Philippines are some of
the major KPO service providers today.
A BPO executive in a developing nation earns about $6,000 a year whereashis KPO counterpart can earn over $8,800 annually a huge 46 per centdifference.
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REQUIREMENT FROM AN M.B.A STUDENTDomain Knowledge, I.T, E.R.P, Business Applications, E-commerce
Qualifications :
MBAs (HR, IT, Finance, Marketing, IB, etc )
Doctors ( MBBS)
Engineers (B. E., B. Tech, M. Tech)
Lawyers (LLB)
Teachers (B. Ed)
Chartered Accountants
Economists
Architects
So basically, the key competencies required are :
Domain knowledge
Basic interest in the field of work
Aptitude for working with data and information
Good communication skills
Team work
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In 2003, the market share of Indian KPO sector in global KPO marketwas 56%. And it is expected to reach 71% in 2010, which shows a
decent growth of the sector in the coming years.
According to NASSCOM,
KPO sector worldwide is expected to reach USD 17 billion by 2010.
Out of this, India will account for USD 12 billion.
Future Scenario
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Market potential for outsourced non-ITservices (2008)
Service Potential (In billion Dollars)
HR Service 44
Customer interaction services 33Data Search, integration andManagement 18Finance and accounting 15Remote education 15Other including pharmaceutical andresearch and development 8Engineering and design 5Medical Content and services 1Legal Content and services 1Translation, transportation etc. 1
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Financial Services : These include financial determining, insurance, risk assessment,equity research, underwriting, fund management, actuarial analytics,debt collection and recovery, corporate & market research, etc.Some of the KPOs working in this area are Smart Analyst, Office Tiger, The Smart Cube.
Market Research and Analytics : These include services like writing & editing,secondary & primary research, formatting client reports, conversion of findings toknowledge, etc. Some of the KPOs working in this area are marketRx, Pipal Research,Evalueserve, Inductis, OfficeTiger, Copal Partners, CRISIL, etc.
CLASSIFICATION OF KPO SECTOR
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India is emerging as a leader in KPO marketWell established IT services and BPO sector
Excellent project management skills
Highly qualified professionalsProficiency in English
Supporting government policies
Challenges which KPO industry is facing are as following:
Expected dearth of domain expert professionalsHigh attrition rates
Talent retention
Data Security and confidentiality
Growth drivers of KPO sector:Shortage of knowledge professionals in countries like USA, UK, etc.
Low wages labour
BPOs moving up the value chain
Single vendor services
Talented workforce
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carry
out
th
e
work.
Therefor
e
many
companies
offer
their
employ
In the next 5 years India will employee more than 2.5 lac people
70% of the global KPO business.
India has the world's second highest number of engineers, scientists, managers.
Also, it has the largest talent pool in IT industry with approximately50% of them proficient in English.
If you are a fresh graduate and you want a high paying job
MBA's, CA's, law graduates etc.with a starting package of 4.2 to 4.8 lacs per
annum.
Exevo, Evalueserve or Pipal Research, the package can go upto 6 lacs per anum.
Salaries in Indian KPO are 25%-50% higher than in other KPOs around the world.
Salaries are bound to increase later on also as the work outsourced to Indian
KPOs is of high quality and of complex nature. It takes a lot of expertise and
skills to carry out the work.Therefore many companies offer their employees 6 monthly salary hikes
anywhere between 15%-20%.
And in the future also, the salaries are going to rise in the Indian KPO sector.
This trend will last at least upto next 10-15 years.
The reason being India's demography and the young talent pool available here.
Why KPOs
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Top Players
in
KPO
Sector
S. No. Companies
1. Evalueserve (EVS)
2. McKinsey & Company
3. RocSearch
4. Pangea3
5. OfficeTiger
6 Copal Partners
7. Gevity8. Pipal Research
9. Grail Research
10. Inductis, EXL Service
11. WNS GLOBAL SERVICES
12. ACCENTURE
13. APTARA (TECHBOOKS)
14. 24/7 Customer
15. ICICI OneSource
16. Ugam Solutions
17. Convergys
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NEWS FROM THE KPO INDUSTRY
yYES Bank setting up a KPOYES Bank, a famous name in private sector banks, is all set to open up aknowledge processing outsourcing (KPO) unit. It is a stand alone project andit will be named as Project TOPS (technology, operations, payments andservices). As estimated by Rana Kapoor, MD and CEO, YES Bank, the unitwill start operating in FY 2008-09. Initially it will provide services inbanking sector. The pilot project presently is being run at YES Bank's
offices at DLF Cyber City in Gurgaon and in Mahalakshmi in Mumbai. Around500 people are working on the pilot project as of now. Till now applicationslike audit and compliance are being outsourced to the unit. But later on itwill move on to other financial services as well.
India to be preferred location for globalKPO industry: KPMGThe financial services sector will account for amajor proportion of the KPO industry and itsworth will be in excess of $5 billion by 2010.
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India top outsourcing hubs, says survey
India remains the most favoured outsourcing destination,according to CyberMedia's Global Services survey onemerging outsourcing destinations in 2007.
Even as fears that the rupee appreciation and rising wage
costs would blunt its edge,India still boasts of the largest number of cities (6),which figure among the top-50 emerging cities,followed by China (5), Brazil (3), the Philippines (3) andthe US (3),among others.
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The last word:It would not be very wrong to state that KPO
do offer an alternate and fruitful careerpath for our young minds.
Going by the current statistics, the KPO wave
is here to stay and Indians can now benefitmuch more than before.
Knowledge Process Outsourcing May Be
The Next Boom Business