Investment Patterns of ITES Employees in Bangalore:

Krishna N (Project Lead)Sheela KBhavani KarinjaSunia MukherjeeMerlin Shobha

Introduction

Introduction to ITES Industry:

The word ITES stands for Information Technology Enabled Services. What a layman can understand by the term is, any service which is given to the customer by virtue of IT can be classified under ITES. Another name for this industry is BPO (Business Process Outsourcing). Since most of the work which is worked on globally is from the clients of other countries, hence the word ‘’Outsourcing’’ is used. Any company which is based in a particular location A can outsource its in-house work to another company based in location B, and that concept is known as outsourcing. For e.g. AT&T has outsourced its call center division to Accenture, India. All the technical support is provided by Indian Nationals sitting in the Bangalore and Mumbai offices in India.

Since over the years, many companies started outsourcing their in-house work within their own home counties to another companies, hence the word ITES became more popular. For e.g. Airtel has outsourced its call center and backend work to IBM. Airtel is an Indian company and has outsourced its business to IBM which is a USA based company; however the call centers are located in India.

Business process outsourcing (BPO) is a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions (or processes) to a third-party service provider. Originally, this was associated with manufacturing firms, such as Coca Cola that outsourced large segments of its supply chain.[1] In the contemporary context, it is primarily used to refer to the outsourcing of business processing services to an outside firm, replacing in-house services with labor from an outside firm.

BPO is typically categorized into back office outsourcing - which includes internal business functions such as human resources or finance and accounting, and front office outsourcing - which includes customer-related services such as contact centre services.

Often the business processes are information technology-based, and are referred to as ITES-BPO, where ITES stands for Information Technology Enabled Service. Knowledge process outsourcing (KPO) and legal process outsourcing (LPO) are some of the sub-segments of business process outsourcing industry.

Benefits and limitations:

An advantage of BPO is the way in which it helps to increase a company’s flexibility. However, several sources have different ways in which they perceive organizational flexibility. Therefore business process outsourcing enhances the flexibility of an organization in different ways. Outsourcing may provide a firm with increased flexibility in its resource management and may reduce response times to major environmental changes.

Another way in which BPO contributes to a company’s flexibility is that a company is able to focus on its core competencies, without being burdened by the demands of bureaucratic restraints.

Key employees are herewith released from performing non-core or administrative processes and can invest more time and energy in building the firm’s core businesses. The key lies in knowing which of the main value drivers to focus on – customer intimacy, product leadership, or operational excellence. Focusing more on one of these drivers may help a company create a competitive edge.

A third way in which BPO increases organizational flexibility is by increasing the speed of business processes. Supply chain management with the effective use of supply chain partners and business process outsourcing increases the speed of several business processes, such as the throughput in the case of a manufacturing company.

Finally, flexibility is seen as a stage in the organizational life cycle: A company can maintain growth goals while avoiding standard business bottlenecks. BPO therefore allows firms to retain their entrepreneurial speed and agility, which they would otherwise sacrifice in order to become efficient as they expanded. It avoids a premature internal transition from its informal entrepreneurial phase to a more bureaucratic mode of operation.

A company may be able to grow at a faster pace as it will be less constrained by large capital expenditures for people or equipment that may take years to amortize, may become outdated or turn out to be a poor match for the company over time.

Although the above-mentioned arguments favor the view that BPO increases the flexibility of organizations, management needs to be careful with the implementation of it as there are issues, which work against these advantages. Among problems, which arise in practice are: A failure to meet service levels, unclear contractual issues, changing requirements and unforeseen charges, and a dependence on the BPO which reduces flexibility. Consequently, these challenges need to be considered before a company decides to engage in business process outsourcing.

A further issue is that in many cases there is little that differentiates the BPO providers other than size. They often provide similar services, have similar geographic footprints, leverage similar technology stacks, and have similar Quality Improvement approaches.

Threats:

Risk is the major drawback with Business Process Outsourcing. Outsourcing of an Information System, for example, can cause security risks both from a communication and from a privacy perspective. For example, security of North American or European company data is more difficult to maintain when accessed or controlled in the Sub-Continent. From a knowledge perspective, a changing attitude in employees, underestimation of running costs and the major risk of losing independence, outsourcing leads to a different relationship between an organization and its contractor. Risks and threats of outsourcing must therefore be managed, to achieve any benefits. In order to manage outsourcing in a structured way, maximizing positive outcome, minimizing risks and avoiding any threats, a Business continuity management (BCM) model is set up. BCM consists of a set of steps, to successfully identify, manage and control the business processes that are, or can be outsourced. Another framework, more focused on the identification process of potential outsourceable Information Systems, identified as AHP, is explained.

Importance of the Study/ Introduction:

Savings and Investment:

Savings are the excess of Income over expenditure for any economic unit.Thus: S=Y- E, where S is the savings, Y is the income and E is the expenditure.

Secondly excess funds or surplus in profits or capital gains are also available for investment. Savings is abstaining from present consumption for a future use. Savings are something autonomous coming from households as a matter of habit. But bulk of the savings come for specific objectives like interest income, future needs, contingencies, precautionary purposes or growth in future wealth leading to rise in the standard of living etc.

When people start saving they search for various investment options t invest their savings. During this process they consider various factors like risk, return, duration, liquidity, tax planning, hedge against inflation, safety etc.

In earlier days the investment options available to investors were very limited like insurance, jewellery, fixed deposits, debentures, shares etc.

But in the liberalized economy there are many investment options, which promise very high returns. After private players started operating in Insurance, there are many policies available which not only cover the risk, but they also promise high return with gook capital appreciation.

You are already aware of the various economic activities. Individuals engage themselves in such activities to earn money. The money they earn is normally spent on meeting daily needs like buying vegetables, groceries, clothes, giving school fees, telephone bills etc. People also generallytry to keep aside a part of their earnings to meet future needs like marriage of their sons anddaughters, buying a house, health care, etc. You also find some people who use a part of theirearning to deposit in banks or in buying shares, property or gold. By doing so these people arealso able to generate some extra earnings for themselves.

Let us learn more about how people earn; how they spend; how they keep money for future needs and how they use their earnings to get some return.

Objectives:

After studying this project you will be able to:

Explain the terms ‘income’ and ‘expenditure’; Identify various ‘sources of income’ and ‘avenues of expenditures’; Explain the concepts of ‘savings’ and ‘investment’; Recognise the need for ‘savings’ and ‘investment’; and Identify the avenues of ‘investment’.

Income:

As we know, individuals engage in one or the other occupations to earn their livelihood. For example, a person may be employed in Bank and draw salary, a person may engage in selling books and earn a profit, a doctor or a lawyer may do the private practice and get fees for their services. The earning from all these sources is called income. Sometimes we find people earn from more than one source. For

example, a teacher can write books for schools and he gets some money from the publishers. If he is a singer, he can sing for All India Radio (AIR) for which AIR gives him some money. Thus, one individual can engage in different occupations to earn money. The earnings from different sources collectively is called as his total income. This total income in a month is called as his monthly income and in a year is annual income.

Sources of Income:

You learnt that people earn money from different sources. Some may earn from a single source and others may have multiple sources. Let us learn about the various sources from which people earn their income.

Business: Individuals engaged in business earn income by way of profit.

Employment: People who are in employment earn their income by way of salary or wages.

Profession: You have seen doctors, lawyers and chartered accountants. They provide personal services of special nature and charge fees for their services. This fee is the source of income for professionals.

Vocation: As we know vocation is the application of one’s special skill or knowledge to earn money. For example, a good cook can cook food at marriage parties and earn some income. A carpenter can make or repair furniture and earn income.

Agriculture: When we cultivate land we produce crops, paddy, vegetables etc. All or a part of it can be sold which gives us a return. This earning is called agricultural income.

Property: Normally owning land or a home is considered as owning property. This property can be given on rent or lease to someone for use and we get a return on it. Thus, it becomes a source of income for us.

Other Income: People keep a part of their earning either in banks, post office or they can buy shares and debentures, government bonds etc. All these give them some return in the form of interest/dividend. These are also called their income.

Expenditure:

When we buy goods or products we pay money for them. Similarly when we avail of some services like consulting a doctor during illness or getting water and electricity for use, we also pay for them. Normally we pay for all these goods and services since we use them. Sometimes we present some gift items to our friends and relatives for their use. Besides this, we also spend money on charity and donation to the poor persons and also to the cyclone or earthquake victims. In these cases, we do not earn any money out of such spending. These are our expenditure. Sometimes we spend money and use it for other purposes to get some additional income. That spending is a type of expenditure through which we generate further income. This is called investment. To clarify the concepts further let us observe the activities of a housewife and a restaurant owner. Both of them buy vegetables. A housewife buys them for consumption of her family and the restaurant owner buys them to prepare different dishes and sells them at a profit.In the first case the housewife does not get any monetary return. Thus, it is expenditure for her. In the second case i.e., in case of restaurant owner, spending on vegetable can be termed as investment, because the spending on vegetables finally generates additional income for him. Thus, the term ‘Expenditure’ refers to spending of money on any item, which does not give any additional monetary income in return to the person who spends that amount.

Avenues of Expenditure:

Generally, most of us spend a major portion of our income on buying goods and services for daily consumption. Besides spending on goods and services there are also many other areas in which we spend money like expenditure on celebrations, on entertainment, charity and donation, etc. The different areas in which we spent our earnings are called avenues of expenditure. Let us learn in detail about all these avenues.

Expenditure on Goods and Commodities: We may spend money on various types of goods and commodities needed for use in our daily living. These may be perishable goods like vegetables, milk, fish, etc. or may be consumer durables like television, radio, furniture etc.

Expenditure on Services: We also spend money for availing of different types of services. It may be for availing banking services, postal services, transport services, communication services etc.

Expenditure on Celebrations: In our daily life we find several occasions for celebration. It may be a birthday, an anniversary, a festival, a marriage ceremony etc. On such occasions we spend a lot of money.

Expenditure on Entertainment: In our busy life we often feel like taking a break for some sort of enjoyment through entertainment progammes. This may include going to watch a movie or drama or dance or cricket match or even going for a picnic or tour.

Expenditure on Charity and Donation: Sometimes people spend money by donating to individuals or institutions engaged in social services or charitable work. These are called expenditure on charity and donation.

Expenditure on Health and Education: In a family people usually spend some money on health and education of their children. When individuals go for higher education it requires more money. Thus, money spent on health and education may be termed as expenditure.

Other Expenditure: The modern age has paved newer avenues of expenditure for people. For example, now-a-days people go to a gymnasium to keep themselves physically fit, go to beauticians to take care of their body and beauty, surf the Internet to gather information and also send e-mails, etc.

Savings:

Ramesh and Suresh are working in a school. They had joined this school together and have been earning some amount of money for the last five years. Last month there was a training programme on computers in their school and both of them participated in it. They liked computers so much that they decided to buy one each for their own use. Ramesh asked the school authority for a loan to buy the computer, as he did not have sufficient money with him. The school authority asked him to wait for at least two months to get the loan processed and sanctioned. Suresh had sufficient money with him and he went to the market and purchased a computer.

Knowing this Ramesh asked Suresh, “Look, from where did you get this money?” Suresh said, “I got it from my savings”. Ramesh enquired, “What is savings?” Suresh answered, “See, every month I used to keep aside a portion of my income for future use. And over a period of five year this has become a substantial amount to enable me to buy a computer.”

Thus, we find that savings refer to the amount of money, which is kept aside from the current income for future use. We may be able to keep aside this money either by reducing our expenditure or by increasing our income or by doing both.

Investors are savers but all savers cannot be good investors, an investment is a science and an art. Savings are sometimes autonomous and sometimes induced by the incentives like fiscal concessions or income or capital appreciation. Savers come from all classes except in the case of the population who are below the poverty line. The growth of urbanization and literacy has activated the cult of investment. More recently, since the eighties the investment activity has become more popular with the change in the govt. policies towards liberalization and financial deregulation. The process of liberalization and privatization was accelerated by the govt. policy changes towards a market oriented economy, through economic and financial reforms started in July 1991.

Need for Savings:

Savings are essential not only for individuals, family or businessmen but it is also very much required for a nation. Growth is practically impossible without savings. Individuals save because of several reasons. Let us discuss why we all require savings.

Savings help us to meet future requirements: We need money in future for various purposes like spending money on higher education, on marriages and other celebrations, owning some immovable assets like house, land, farms etc. With savings at hand we, can meet all these expenses.

Savings help us to meet expenses during emergencies: There are events which are uncertain and may occur in future. All these events may require some amount of money to be spend, which we can have from our savings. For example, we may require money during emergencies like sudden illness, accidents, etc.

Savings help us to raise our standard of living: Savings accumulated over a period of time become a substantial amount, which enables us to buy something, which is better, comfortable or even luxurious. For example, you can buy a vehicle of your own, a home, good furniture, you can use generators/inverters at home to avoid power cut, etc. All these improve your standard of living.

Savings help us to generate further income: We can use our savings or part of it in buying shares, debentures or bonds, in buying property and renting it out or even in keeping money in a bank for a fixed period. All of these can give us an assured return in terms of dividend, rent or interest. This is an additional income for us.

Savings help the nation in its economic development: When we keep our savings in a bank or in a post office, we get interest in return. But have you ever thought what they do with our money? How do they generate more money from our savings? Actually they utilize our money for various productive purposes. For instance, banks may give our money to the business houses as loan and charge more interest from them. Similarly, government may use our savings in various industrial activities, by taking it from the post offices or banks. Thus, our savings help in development of business activities, which ultimately contributes to the overall economic development of the country.

Impact on Inflation:

All the investments lose in value due to inflation or rise in prices leading to depreciation of the rupee. When the rate of inflation or rise in prices leading to depreciation of the rupee. When the rate of inflation is about 10%, the real value of money is lost by 10% every year. The investors have therefore to protect themselves from this loss of real values of their assets by proper investment planning and by securing returns, higher than the inflation rate.

Some investments give only income like bank deposits, Post Office certificates, company deposits etc. Some assets show capital appreciation if they are shares in companies or bullion, land and buildings. Some are safe and liquid, like the investments in government securities, bonds of P.S.U, etc. A few investments like Indira Vikas Patra are easily transferable and marketable. So also the shares and securities listed and traded on the stock exchanges. But all the above investments do not satisfy all the needs and objectives of investors, referred to later, including securing a hedge against inflation. All objectives of income, capital appreciation, safety, marketability and liquidity as also hedge against inflation can be secured only by proper investment in corporate securities.

Tips on Saving:

We have learnt that savings are required for every individual. Let us learn some tips so that we will be able to save.

Keep a record of your total income and its sources: This is essential as you get to know when and how much you earn and to plan your expenditure accordingly. Keep a record of your current expenditure: As you know there are certain expenses which you have to incur regularly and the amount you spend is almost certain. For example, expenditure on food, tuition fee for children, electricity and water bill, expenses on newspaper, house rent, etc. These are your current expenditure. Once you know about these expenditures which you cannot avoid, you can plan for other expenses keeping current expenditure in mind.

Plan your expenditure: There are certain expenses which do not occur regularly. For example buying a TV, refrigerator, washing machine, computer etc. To spend on these you have to make a priority list and then you can defer the expenditure, which is least important. For example, suppose you plan your expenditure on 25th December and fix your requirements as a refrigerator, a computer and a washing machine. You prioritized your requirements in the following order – washing machine, refrigerator, and computer. This is so because you find that a computer shall be most useful during the next academic session, a refrigerator shall be most useful during summer (next March) and washing machine is urgent as it is becoming difficult to wash cloth manually in winters. So naturally your will spend on the washing machine and defer your expenditure on the refrigerator for three months and the computer for six months.

Cut down your expenditure: There are certain expenses which one may incur in an unplanned way. For example, suppose you have gone to Shimla on a tour in the month of March and got some winter clothes. You may use them at Shimla but coming back from Shimla you may not be requiring all those winter clothes. This sort of expenditure may be cut short.

Try to generate additional income and don’t spend it. This is a very good way of savings. Whatever we earn from a regular source we can spend it on our livelihood. But the extra earnings that we make from other sources can be kept aside for future use. For example, suppose one of your articles is published in the newspaper or magazine and you are paid some money for that. You can keep aside this money for future use.

Investment:

We have already learnt that sometimes people spend some money on buying shares, bonds, properties etc. which give them some monetary return. Sometimes people also keep their savings or a part of it as a recurring or fixed deposit in the banks or post offices and earn interest on it. Similarly some people deposit their money in Mutual Funds, Public Provident Fund Account etc. some buy National Savings Certificates from the post office and some take Life Insurance Policies etc. All these give them some additional income. These types of expenditures are called investment. Thus, the term ‘investment’ refers to depositing or spending money on some items that generate additional income either immediately or in the future. For example, if you deposit money in Public Provident Fund Account it will give you some amount of return in the form of interest. So, this is your investment. Besides Public Provident Fund Account there are a number of other avenues in which you can invest your money. Let us learn the details about these avenues.

Objectives of Investor:

Income

Appreciation of capital

Safety

Liquidity

Hedge against inflation

A method of tax planning

The mix of these objectives may also depend on the time frame of his investment.

Short-term/day to day trading gains

Short term capital gain up to one year

Long term appreciation more than 1 to 3 years.

Investment preferences of public may be set out in terms of their savings for:

Transaction purpose (for daily needs or regular payment?

Precautionary purpose ( for contingencies or special needs)

Speculation or asset purposes ( for capital gain or building of assets)

Where to Invest:

Deposits in Banks and Post Offices: These are the most common, popular, risk free and trustworthy investments. In banks and post offices individuals deposit their money in savings account, where they can withdraw the money whenever required. They can also deposit money for a fixed period on one-time basis or a recurring basis. All these investments are safe and give an assured return. There is something known as recurring deposits. That means in Banks we can open recurring deposit accounts, and every month/quarter we can deposit the fixed amount and the bank will give a fixed interest on that money which is usually higher than the regular interest rates in the banks.

Other Schemes/Certificates of Bank, Post Office: Apart from deposits, the banks and post offices also offer various other schemes like Monthly Income Scheme, National Savings Scheme, Public Provident Fund, National Savings Certificates, Kissan Vikas Patra etc., which provide assured return and are risk free.

Government Bonds: Sometimes government and semi-government organizations accept deposits from individuals for a fixed period and promise to pay a fixed amount after the stipulated period. These are in the form of bonds, which are also risk free and provide assured return.

Life Insurance policies: Post offices, Life Insurance Corporation of India and other private sector life insurance companies insure the life of individuals for a specific amount for a specified period upon payment of a premium amount. The individual who is insured gets a good return on maturity of the policies. This is a very important form of investment. People should look if they are adequately covered. A person’s net worth plays a huge role in determining the amount of policy s/he should have. If a person’s earnings are high, then accordingly the life style changes. Hence individuals should ensure that they buy enough coverage so that if case of their unfortunate death, their family can survive well on that insurance money.

UTI and other mutual funds schemes: There are some financial institutions (may be government, semi-government or private) which raise money from individuals and invest the collected amount in securities and deposits and thereby earn a good return. This return is then distributed among the investors as dividend. These types of investments are risky. It may give you very good return or it may also lead to losses.

Corporate securities and deposits: There are companies which accept deposits from public for a fixed period. People can invest their savings in these companies. This is bit risky as your money goes into private hands. But if the company is good and a reputed one, you can get assured return. Similarly people sometime invest in buying shares of the company. If the company is performing well the shareholders get good return otherwise the shareholders may not get anything. These investments are again risky.

Real estate: Sometimes people spend money on buying a plot of land, an apartment or a house etc., the value of which appreciates over a period of time. By giving it on rent they can earn money. These types of investments are less risky though they do not provide an assured return.

Business activities: You must have observed that some people invest money to carry on various business activities. They may start the business individually i.e., in the form of sole proprietorship, or by inviting others to invest money with them i.e., they can start partnership form of business. By investing their money and putting their best effort then can get return in the form of profit.

Investment in the share market: A person can invest his money in the share market by purchasing shares. A share market is a public institution and it serves the growth of the capital market. In a stock market, purchase and sale of shares are made in conditions of free competition. It is organized as voluntarily, non-profit making association of brokers to regulate and protect their interests. Whenever a company raises capital through public issue of securities, its securities are required to be listed on the stock exchange within ten weeks of the closing of the subscription list mainly to provide liquidity to the investors.

Gold, Silver, Precious Metals and Precious Stones: All these items vary as per the market rates. And in the past few years, the rates of them have only increased.

Please go to this site which will give you a day wise rate of gold.

http://www.marketonmobile.com/gold_price_2011.php?m=February

Now if we see the gold price per 10 gram on Jan 2009, it was Rs. 13664. And it was Rs. 27322 on Jan 1, 2012. So in 3 years it went up by Rs. 13658, which is almost 100%. So if someone had invested in gold at the right time, then it brings in good results.

The same goes for silver too. Silver price on Jan 1, 2009 was Rs. 13753/Kg and it went up to Rs. 51043/Kg on Jan 1, 2011. So the increase was Rs. 37290/Kg that means the increase was 271%. Hence people who had invested in silver had reaped a better return than investing in gold. In fact on May 1, 2011 it went up to Rs. 71576/Kg.

Provident fund- statutory, recognized, unrecognized, public provident fund: Employee Provident fund scheme came into effect in 1952, and this was done on a mandatory basis so that employees save on a monthly basis through a government scheme. The govt. gives interest on the money which is deducted in PF. All the employees (including casual, part time, Daily wage contract etc.) other than an excluded employee are required to be enrolled as members of the fund the day, the Act comes into force in such establishment. Ideally when someone attains the age of 55, or over and retires from his duties, then s/he is eligible to withdraw the PF. The better course would be to invest in savings in Public Provident Fund (PPF) so that the money is blocked and saved for a minimum period of 15 years. It is totally exempt from tax.

Unit scheme of Unit trust of India (Some are marketable among these): The announcement by the Chairman of Unit Trust of India (UTI) Mr. PS Subramanyam, that all repurchases of units would be stopped for six months, betrayed the trust that 20 million domestic investors had reposed in the institution. In one sweep, UTI removed liquidity, one of the prime components of an open-end fund to nothing at all. The government gave the Unit Trust of India two weeks to devise a way of allowing small investors to redeem units in its biggest fund. The government wanted the suspension lifted for small investors, as it would have jolted the investor’s confidence on the industry in a big way, something that the government did not want to happen. UTI obliged by setting up a committee for the purpose of proposing a way out to end the problem and to help restructure the scheme from the state of shambles that it currently is in. Investors stand to gain from the latest mechanism, which has been worked out after a lot of brainstorming and though it is yet to get a nod from RBI, in all probability, in the best interest of all the concerned parties, the modalities shall be worked out properly. However, given the degree of uncertainties involved, investors can do nothing but watch the drama unfold and just hope that the outcome is in their interests.

Venture Capital: Venture capital (VC) is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which and usually have a novel technology or business model in high technology industries, such as biotechnology, IT, software, etc. The typical venture capital investment occurs after the seed funding round as growth funding round (also referred to as Series A round) in the interest of generating a return through an eventual realization event, such as an IPO or trade sale of the company. Venture capital is a subset of private equity. Therefore, all venture capital is private equity, but not all private equity is venture capital.

In addition to angel investing and other seed funding options, venture capital is attractive for new companies with limited operating history that are too small to raise capital in the public markets and have not reached the point where they are able to secure a bank loan or complete a debt offering. In exchange for the high risk that venture capitalists assume by investing in smaller and less mature companies, venture capitalists usually get significant control over company decisions, in addition to a significant portion of the company's ownership (and consequently value).

Investment Avenues:

All investments are risky, as the investor parts with his money. An efficient investor with proper training can reduce the risk and maximize returns. He can avoid pitfalls and protect his interests.

Classification of Investments:

There are different methods of classifying the investment avenues. A major classification is:

Physical investment: Example of physical investments is land, property, flats, house, gold, precious metals and stones, paintings etc. They are physical, if savings are used to acquire physical assets, useful for consumption and/or production. Many items of physical assets are not useful for further production of goods or create income as in the case of consumer durables, gold, silver etc.

Financial investment: Examples are Fixed Deposits, Bonds, Shares, and Mutual Funds etc. Most of the financial assets, barring cash are used for production or consumption, or further creation of assets, useful for production of goods and services. Among different types of investments, some are marketable and transferable and others are not. Examples of marketable assets are shares and debentures of public limited companies, particularly the listed companies on stock exchanges, bonds of P.S.Us, Government securities, etc. Non-marketable securities or investments are bank deposits, provident fund and pension funds, insurance certificates, post office deposits, NSC bonds, company deposits, private limited companies shares etc.

Difference between savings and investments:

Savings are money or other assets kept over a long period of time, usually in a bank without any risk of loss or making profit. Investments are money or other assets purchased with the hope that it will generate income, reduce costs, or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth. In finance, an investment is a monetary asset purchased with the idea that the asset will provide income in the future or appreciate and be sold at a higher price. And usually it has also a risk of some loss.

As far as we are talking about investment then it is certain amount of money which is saved or used in some projects where we can take profit more than the money we have saved or invested. In general terms investment means the use of money to make more money.

Think Before Making an Investment:

When you are investing money you must look into some factors to reduce the risk involved in investment. Analysing these factors you must decide where to invest.

Ability to save: Some of the investments require regular contributions of certain amount of money like payment of LIC premium or installments in a recurring deposit. You must assess your ability to save before taking any decision.

Safety: You must look into the various risks or drawbacks of the instruments where you are going to invest to ensure safety of your investments.

Easy Liquidity: Any investment you make must be capable of being converted into cash whenever necessary.

Rate of Interest: Rate of interest is more important than the amount of return you get. Savings and Investment normally, for larger deposits, higher rates of interest are fixed.

Tax relief: One must take into consideration the various tax benefits we can avail of through our investments.

New developments in Investment avenues:

Exchange traded funds: (ETFs) are a new variety of mutual fund that first became available in 1993. ETFs have grown rapidly and now hold nearly $80 billion in assets. ETFs are sometimes described as more 'tax efficient' than traditional equity mutual funds, since in recent years, some large ETFs have made smaller distributions of realized and taxable capital gains than most mutual funds. This paper provides an introduction to the operation of exchange traded funds. It also compares the pre-tax and post-tax returns on the largest ETF, the SPDR trust that invests in the S&P500, with the returns on the largest equity index fund, the Vanguard Index 500. The results suggest that between 1994 and 2000, the before- and after-tax returns on the SPDR trust and this mutual fund were very similar. Both the after-tax and the pre-tax returns on the fund were slightly greater than those on the ETF. These findings suggest that ETFs offer taxable investors a method of holding broad baskets of stocks that deliver returns comparable to those of low-cost index funds.

REIT (Real estate investment trust): REITs are companies, which own properties such as office buildings, shopping complexes, and hotels etc, which are giving continuous income. As these companies pass most part of their income to the shareholders, they get tax benefits from their income. Like other stocks that are traded in the stock exchanges, REIT can also be traded in the stock exchange. REITs give a new opportunity to the retail and institutional investors to diversify their portfolio.

The Emerging Investment Avenues:

According to a study undertaken jointly by Merrill Lynch and Cap Gemini Ernst and Young, High Net worth Individuals [HNIs] or wealthy investors are proactive in portfolio management, risk management, consolidation financial assets and use of diversification strategies as actively as large institutions. HNIs are proactive in identifying new investment options and take inputs from professional advisors in volatile market conditions.

HNIs are dynamic in modifying their asset allocation and were among the first investors to move from equities to fixed income during 2001-2002 period of downturn in equity markets. They shifted back to equities when they identified favorable market trends.

Needs of wealthy investors

Wealthy investors being aware of the emerging investment opportunities use sophisticated investment strategies such as:-

Leveraging on the professional advisors' capability to analyse market trends and make appropriate investments.

Searching for innovative products to enhance value.

Diversifying across various types of assets.

Investing across emerging geographies.

Consolidating financial information and assets.

Investment products and avenues

Managed products: Managed product service is the most popular investment strategy adopted by wealthy investors globally.

Real Estate: Wealthy investors have found this asset class very attractive and have invested directly in real estate and indirectly through real estate investment trusts.

Art and passion: Wealthy investors also have their investment in art, wine, antiques, and collectibles.

Precious Metals: Gold and other precious metals are attractive investment options to balance the asset allocation.

Commodities: Wealthy investors have turned to commodities to offset the lower returns from fixed income securities.

Alternative investments: Hedge funds and Private equity investments such as venture funds are becoming increasingly popular with wealthy investors to reduce the investment risks related to stock market fluctuations. This is because these instruments have low correlation with equity asset class performance. Investment in non correlated assets, such as commodities helps to improve diversification of the portfolio amidst volatile market conditions.

Characteristics of wealthy investor:

The wealthy investor of today is:-

Young, educated and knowledgeable.

Well informed about global trends.

Willing to take risks.

Demanding and quality conscious.

Performance oriented in taking decisions and less loyal.

Techno savvy and seeks information from various sources.

Smart in looking for the best deal.

Not attracted by traditional status symbols that do not add value.

Hands on in checking investments, making deals and getting personally involved.

Special needs of wealthy investors

The strategies and characteristics of wealthy investors has led to financial institutions innovating and expanding their product range to meet the growing demands of such investors.

A financial advisor should keep in mind the following special needs and expectations of the wealthy clients:-

Demand broader range of services and skills: Wealthy clients not only are on the lookout for multiple investment avenues, unlike other clients, but are also ready to face the risks associated with newer products.

Net worth and goals need to be matched and assets need to be planned tax effectively: Since wealthy investors have surplus funds that can be passed on to the next generations and also come into the high tax paying category, investors need to advise them on the best methods to transfer their assets after death as well as on the best tax saving investments.

Estate planning and tax planning: In-depth knowledge about tools of estate planning such as wills, trusts, and power of attorney is necessary. It is also important to know the succession rules and tax rules to do effective tax planning resulting in minimal/no tax on transfer of assets.

Educate the client: Educating the client on various and different types of investment avenues that will suit him the best will prove very beneficial for the financial advisor. Wealthy clients, especially those who are self made, may assume that if they can make wealth in one industry they can manage their own portfolio as well. In such cases it is best to educate the client about the best investment options rather than trying to push a product; because if one is trying to push a product, the client is unlikely to get interested since he/she will be having enough people chasing him/her for investments.

In the BPO industry, the salaries are quite high. And an average manager earns anything between 10-20 Lakhs/ annum. Hence there are many HNIs in this sector and we have tried to include some of them in this study and have tried to analyse their approach towards investments.

Features of investment avenues:

The investor has various alternative avenues of investment for his savings to flow in accordance with his preferences. All investors involve some risk or uncertainty. The objective of the investor is to minimize the risk involved in investment and maximize the return.

1. Risk: The risk depends on the following factors: a) The longer the maturity period, the larger is the risk. b) The more the creditworthiness of the borrower or agency issuing securities, the less is the risk. c) The nature of instrument, namely, the debt instrument or fixed deposit or ownership instrument like equity or preference share, also determines risk. d) The risk of variability of returns is more in the case of ownership capital as the return varies with the net profits after all commitments are met. e) The nature of tax liability on the instrument.

2. Return: A major factor influencing the pattern of investment is its return, which is its return and capital appreciation, if any. The difference between the purchase price and the sale price is capital appreciation and the yield is the interest or dividend divided by its purchase price.

3. Safety: The safety of the capital is the certainty of return on capital without loss of money or time involved. In all cases of money lent, some transaction costs and time are involved in getting the funds back.

4. Liquidity: If a capital asset is easily realizable, salable or marketable, then it is said to be liquid. An investor generally prefers liquidity for his investments, safety of his funds, a good return with a minimum risk or minimization of risk and maximization of return (dividend and capital appreciation).

5. Marketability: This refers to transferability or salability of an asset. Those listed in stock market are more easily marketable than those that are not listed.

6. Tax benefits: Some instruments enjoy good tax benefits; hence their net return is higher.

Risk-return Relationships:

Risk and return are directly correlated with each other, when risk high return is also high and vice versa.

The relationship between risk and return is a fundamental financial relationship that affects expected rates of return on every existing asset investment. The Risk-Return relationship is characterized as being a "positive" or "direct" relationship meaning that if there are expectations of higher levels of risk associated with a particular investment then greater returns are required as compensation for that higher expected risk. Alternatively, if an investment has relatively lower levels of expected risk then investors are satisfied with relatively lower returns.This risk-return relationship holds for individual investors and business managers. Greater degrees of risk must be compensated for with greater returns on investment. Since investment returns reflects the degree of risk involved with the investment, investors need to be able to determine how much of a return is appropriate for a given level of risk. This process is referred to as "pricing the risk". In order to price the risk, we must first be able to measure the risk (or quantify the risk) and then we must be able to decide an appropriate price for the risk we are being asked to bear.

Research Design:

Problem Statement: We have been working in the BPO industry for a long time. Sunia has been working for 10+ years in this industry; Krishna is working for 6 years, Merlin for 4 years, Bhavani for 4 years and Sheela for 3 years. We have realized that we have earned a lot of money from this industry; however our investments are not up to the mark.

During the global recession in 2008, we have seen many of our colleagues losing jobs, and then we realized all the more the importance of investments.

We have also gone through traumas of a family member being hospitalized, and the huge expenses which we have to incur during such times.

It is not only us, we have seen most of our colleagues working in this industry are earning well, however their savings are investments are poor. In fact most of them own credit cards and often are neck deep in debts. Also they often take personal loans to buy consumer durables like TV, Fridge, and Washing Machines etc. and pay anything between 12-20% as interest/ year of such loans.

Hence we thought of taking up this study so that we can not only gather data and reach to a conclusion, so that we can create awareness amongst young BPO employees regarding savings and investments.

Reasons for taking up this study:

As per a study done by Price Water Coopers, here we can find some facts:

Please go through the entire study at:

http://www.pwc.com/en_IN/in/assets/pdfs/publications-2011/Indian_IT-ITeS_Industry_-_Changing_Landscape_and_emerging_trends.pdf

The Indian information technology (IT) / IT enabled Services (ITeS) industry has played a key role in putting India on the global map. Over the past decade, the Indian IT-BPO sector has become the country’s premier growth engine, crossing significant milestones in terms of revenue growth, employment generation and value creation, in addition to becoming the global brand ambassador for India.

The Indian IT-BPO sector including the domestic and exports segments continue to gain strength, experiencing high levels of activity both onshore as well as offshore. The companies continue to move up the value-chain to offer higher end research and analytics services to their clients.

The Indian IT-BPO industry has grown by 6.1 percent in 2010, and is expected to grow by 19 percent in 2011 as companies coming out of recession harness the need for information technology to create competitive advantage.

India’s fundamental advantages—abundant talent and cost—are sustainable over the long term. With a young demographic profile and over 3.5 million graduates and postgraduates that are added annually to the talent base, no other country offers a similar mix and scale of human resources.

Realising the wealth of potential in the IT-ITeS sector, the central and state governments are also working towards creating a sound infrastructure for the IT-ITeS sector. CII aims to make the Indian IT and ITeS industry world class by continuously providing a platform for understanding and adoption of the new developments & best practices worldwide in this sector, taking up issues and concerns of the Indian industry with the relevant ministries at National and State level, coming up with studies, reports and surveys to help understand the potential of Indian IT and ITeS market and the issues faced.

As one of the key growth engines of the economy, the Indian IT/ITeS industry has been contributing notably to the economic growth accounting for around 5.6% of the country’s GDP and providing direct employment to about 2.3 million people and indirect employment to many more. (Data collated till 2011).

Since this industry has a huge potential, and it is providing a positive impact on India’s GDP, and every year a lot of new graduates and post graduate young people are joining the work force, we thought that this will be a good platform to base our studies on.

Since this is an emerging and young sector, not too many studies have happened in this sector. Hence it gave us a fresh platform to work on. Plus since many of our friends and colleagues work in this sector, it was easy for us to collect primary data. Also this was a very relevant study which would have benefitted most of us and this research would have helped us to create awareness amongst our colleagues and friends associated with this industry.

Bangalore is known as the Silicon Valley of India and most of the IT and ITES companies have their large operations in Bangalore. Hence Bangalore has a sizeable population and we will take a small sample from that population for this survey.

Since out of total investment from Bangalore, substantial share is from ITES professionals, the researcher is making a study here to understand the investment pattern of ITES professionals. The knowledge about investments and portfolio designing is limited for ITES professionals as there area of study and interest is different. The decisions they take regarding their investments may not be accurate and hedging will not be taken care properly if portfolio is not proper. Therefore this study is basically conducted to find out the investment pattern of ITES professionals in Bangalore city and offer suggestions for better performance of the funds invested.

Scope of the study: The area covered for the study of “A study on investment pattern of ITES Employees in Bangalore” is about X ITES companies for the collection of primary data. They are:

1. Infosys BPO

2. Accenture BPO

3. IBM- Daksh BPO & IT Services.

4. HP (BPO and IT Services)

5. Fidelity BPO Wing

6. GENPACT BPO

7. ANZ Services/BPO

8. KPMG

9. Dell (BPO and IT Services)

10. Others

Profile of the ITES companies:

1. Infosys BPO:

Progeon was established in April 2002 as the BPO subsidiary of Infosys Technologies and today is among the top third party BPOs in India according to NASSCOM. It was started as a 74% and 26% joint venture between Infosys and Citibank Investments. In 2006 Infosys bought out Citibank's share at a price of Rs 592 per share. Today it has operations in Bangalore, Chennai, Gurgaon, Bhbaneshwar, Jaipur and many other Indian Cities along with international centers like, Monterrey, Mexico, Lodz, Poland, Brno, Czech Republic, Atlanta, USA, Hnagzhou, China, Manila, Philippines, and Brazil. Infosys BPO, the Business Process Outsourcing subsidiary of Infosys Limited (NASDAQ: INFY), is an end-to-end outsourcing services provider. Infosys BPO addresses your business challenges and unlocks business value by applying proven process methodologies, integrated IT and business process outsourcing solutions. The company applies business excellence frameworks to significantly reduce costs, enhance effectiveness and optimize business processes. The company focuses on integrated end-to-end outsourcing and delivery of result-oriented benefits to our clients through reduced costs, ongoing productivity improvements and process reengineering.

Our business solutions and leadership are recognized by several global forums. We are consistently ranked among the leading BPO companies in India by industry bodies such as Global Outsourcing 100 (The International Association of Outsourcing Professionals), FAO Today, and NelsonHall.

Infosys BPO has not only pioneered "Business Value Realization" (BVR), but has also emerged as a trusted and valued collaboration partner through consistent focus on improving process and end-business metrics. We continue to enable realization of business value, customer satisfaction and co-creation to sustain long term partnerships.

We take pride in being a consistent performer and are endorsed by industry analysts, customers (internal and external), and alliance partners. Infosys BPO is a global company operating in the Americas, APAC, Australia and Europe with over 21,421 employees and revenues of $494.9 million as of March 31, 2012.

Business Transition Methodology

Infosys BPO enables flexible business process management services through global delivery centers. We believe that a well managed transition provides a robust foundation for smooth operations. A key aspect of our service is the transition of business processes from client’s locations to our delivery center(s). We have a comprehensive and mature transition methodology documented from over 1,000 transitions.

Overview

Infosys BPO leverages global delivery centers to deliver predictable and flexible business process management services. A key aspect of our service delivery is the successful migration or transition of business processes from the client’s locations to our delivery center(s).

We have a comprehensive and mature transition methodology that has been refined and documented during the course of more than 1,000 transitions. Compliance is monitored through check points at different stages.

We believe that a well managed transition provides a robust foundation for a stable operation across the outsourcing cycle.

Transition Methodology

Our transition methodology ensures process enhancement across five phases:

Project Preparation

Planning

Execution

Parallel Run

Steady State At the end of each phase, our quality team confirms meeting pre-defined success criteria that are mutually agreed by the client and our transition team. Our quality team works independently of the transition team.

We also encourage clients to participate in reviews and audits. Our transition methodology addresses knowledge management, technology management, operations management, contract management and program management. A high level of accountability is ensured through individual owners for each track, as illustrated below.

 

Project Preparation

Project preparation begins with the handover of the solution design to the transition team. It involves defining the roles and responsibilities of key stakeholders to ensure a smooth transition. A dedicated transition team consisting of a transition manager, operation and documentation specialists, and trainers, is deployed.

The team has access to a shared resource pool from technology, legal, finance, human resources and quality during transition. It involves Knowledge Transfer (KT), team identification and preparing the team for onsite assignment.

Planning

After a detailed planning workshop with the client, this phase involves finalization of the integrated project plan. It includes plans for operations, delivery, technology, recruitment, quality, and risk to cater to project requirements. In addition, the integrated project plan mobilizes resources and arranges logistics.

The objectives of planning include -

Creation of a detailed execution plan for all work streams

Validation of FTE ramp-up, technology requirements and establishment of a governance structure

Identification of deliverables across different functionalities

Pre-empting and monitoring implementation of the plan across all phases – a continuous and consistent exercise

Assessing and mitigating risk

Workflow tool/ point application requirement collection and analysis Execution Execution involves the implementation of the transition solution. We deploy domain, process and technology teams to address transition -

Knowledge transfer: Includes the construction of operating procedures, preparation of training documents, and training executives to execute the process offshore

Technology transfer: Identifies the optimal network architecture, procurement of bandwidth and systems, and installation, testing, and deployment of technical infrastructure.

Operating preparedness: Includes recruitment, induction and site preparation Parallel Run In this phase, offshore operations are initiated with active client support. Gradually, the responsibility is transferred to the offshore operations team while ensuring that inter-dependent processes are not affected. It involves several stages:

Preparation of the ramp-up schedule

Managing logistics

Execution of offshore ramp-up and onsite ramp-down while maintaining continuity of operations

Establishing service levels Parallel run helps achieve robust operations with all the resources and infrastructure to execute steady state operations.

Steady State 'Steady state operations’ is the ongoing delivery of services. The key objective is "business as usual," where the outsourced processes are executed in accordance with the norms in the Service Level Agreement (SLA). Steady state involves:

Security and business continuity

SLA metrics tracking and reporting to monitor continuous performance

Human Resource Management

Quality Management System

Our transition framework has several features:

Check points after each phase of transition to enable robust implementation

Health checks after go-live as a warranty

Structured Customer Satisfaction (CSAT) survey after each transition to elicit client feedback and ensure world-class transition

Management Profiles

Swami Swaminathan

Chief Executive Officer and Managing Director, Infosys BPO

Raghavendra K

Gautam Thakkar

Vice President and Head - Enterprise Services, Infosys BPO

Abraham Mathews

Vice President and Head - Finance, Infosys BPO

Anantha Radhakrishnan

Vice President and Head - Business Transformation Services, Customer Services and Technology Services, Infosys

BPO

Units at Infosys BPO

Strategic Business Unit (SBU)

BFSI - Banking Financial Services and Insurance

BP - Business Platform

BT - Business Transition

CME - Communication Media and Entertainment

CS - Customer Service

EM - Emerging Market

F&A - Finance and Accounting

HRO - Human Resource Outsourcing

KS - Knowledge Services

MFG - Manufacturing

S&F - Sales and Fulfillment

S&P - Sourcing and Procurement

Business Enabling Functions (BEF's)

Corporate Finance

Corporate Marketing

Corporate Planning

Corporate Sales

Facilites

HRD - Human Resources & Development

Legal

Quality

Privacy and Data Protection

Risk

Solutions & Alliances

TSG - Transformation Solutions Group

Transport

TIG - Technology Infrastructure Group

2. Accenture BPO:

Accenture is a global management consulting, technology services and outsourcing company, with more than 249,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$25.5 billion for the fiscal year ended Aug. 31, 2011.

Accenture is a great success story by any measure. The company’s history has been more than 60 years in the making—from the earliest days as a pioneer in the new world of information technology in the 1950s to its position today as a Fortune Global 500 industry leader.

 

Initially called Andersen Consulting, Accenture was formally established in 1989 when a group of partners from the Consulting division of the various Arthur Andersen firms around the world formed a new organization focused on consulting and technology services related to managing large-scale systems integration and enhancing business processes.

In April 2001, Accenture’s partners voted overwhelmingly to pursue an initial public offering, and Accenture became a public company on July 19, 2001, when it listed on the New York Stock Exchange under the symbol ACN.

The majority of Accenture employees are organized in one of four "workforces" (Consulting, Services, Solutions and enterprise) and they chose to open their BPO wing in Bangalore in April 2003.

Services

Accenture offers a vast range of BPO services to enable high performance, including function-specific services such as procurement, HR and finance and accounting, as well as services geared to the needs of specific industries such as utilities, insurance and health care.

Cross-Industry BPO Services

Finance and Accounting BPO

Human Resources BPO

Learning BPO

Procurement BPO

Supply Chain BPO

Industry-specific Services

Credit Services BPO

Health Administration BPO

Industry-specific BPO

Insurance BPO

Life Sciences BPO

Network BPO

Utilities BPO

Bundled Outsourcing Services

Bundled Outsourcing

Management Profiles

Group Chief Executive 

 

Mike Salvino is group chief executive of Accenture’s Business Process Outsourcing (BPO) growth platform. In this role, he oversees Accenture’s comprehensive portfolio of cross-industry (finance and accounting, HR, learning, procurement and supply chain) and industry-specific BPO services (including credit services, health, network and utilities). He leads a team of professionals charged with developing, selling and delivering differentiated, innovative, insight-driven and operationally excellent services to clients seeking BPO solutions to help them achieve high performance. Accenture’s BPO services are delivered through its Global Delivery Network, which consists of more than 50 delivery centers across five continents.

Under Mr. Salvino’s leadership, Accenture’s BPO business has received many industry accolades including International Association of Outsourcing Professionals’ global service provider of the year from 2008 to 2011 and has consistently been recognized by industry analysts as a market leader for BPO.

3. IBM- Daksh BPO & IT Services:

Daksh eServices Pvt. Ltd. (Which was started by Sanjeev Aggarwal and Pavan Vaish in 2000, and whichwas acquired by IBM in 2004) etc. also played a significant role in the growth of the ITES industry in India.

In April 2004, IBM Corporation acquired Daksh e-Services to form IBM Daksh. Today, IBM Daksh is a leading provider of business process services. It offers solutions in CRM, finance and administration and back-office processes catering to Financial, Travel, Retail, Insurance, Communication and Technology verticals.

Frost & Sullivan has named IBM the Contact Center Outsourcing Vendor of the Year in Asia Pacific, for two consecutive years, 2006 and 2007. It received the NASSCOM-India Today Woman Corporate Awards for Excellence in Gender Inclusivity in the BPO-ITeS category.

IBM Daksh is a winner of many recognized awards for employee and customer satisfaction. The company promises growth for its employees. Some of the facilities offered by the company include life insurance, paid holidays, referral bonus program, company car entitlement, retirement benefits, promotional schemes etc.

With the acquisition of Daksh in 2004, IBM now also has a formidable business process outsourcing (BPO) service portfolio. Associates and analysts work out of the Embassy Golf Links, and Manyata Tech Park Bangalore office in out-sourced business processes of IBM clients. IBM-Daksh has an office in Gurgaon and other cities in India too.

BPO services

The process-driven disciplines of Customer Relationship Management, Finance and Administration, Human Resources and Procurement and Supply Chain Management are rich with opportunities for your enterprise not only to save money but to grow, grab market share and drive customer loyalty. Discover how we innovate processes to deliver measureable business outcomes for clients in a range of industries and markets.

Customer Relationship

Management Services

Reach your customers with a multichannel communications platform and turn flawless service into a selling point.

Finance and Administration

Improve the quality, integrity and accessibility of financial data for better business insight and decision making

Human Resources Learning and Recruitment Outsourcing

Focus on strategic HR and talent initiatives while managing costs and providing an excellent employee experience.

Procurement and Supply Chain Management

Access the best global resources and materials while getting the most value from every dollar.

Outsourcing at IBM

Outsourcing services for business processes, applications and IT infrastructure designed to improve your bottom line.

Overview

Outsourcing your IT needs to IBM helps enable you to focus on strategic direction while trusting IBM to manage the day-to-day operations that monopolize your time. Consider the breadth of IBM expertise and experience managing business processes, applications and IT infrastructure.

Industry-specific business processes are available 24/7. When your company is looking to access new business services quickly and cost-effectively, IBM hosted business processes can be the answer. IBM provides one of the most comprehensive application hosting capabilities in the industry - from basic support to global deployments.

By outsourcing to IBM, you can leverage the leading business applications that can help reduce your time-to-market or boost customer satisfaction without the usual upfront infrastructure costs - or the ongoing implementation and management headaches.

To learn more about our capabilities, please follow the links under 'What we offer' on the left side of this page and explore our application services.

What IBM Outsourcing Offers:

Applications on Demand

Pay-as-you-go infrastructure and application management services for SAP, Oracle, PeopleSoft, and Lotus.

IT outsourcing and hosting

With IBM IT Outsourcing you can benefit from IBM global expertise in the management of applications and other IT components in either a hosted or onsite arrangement.

Services By Industry:

Reduce costs. Manage risk. Optimize supply chains. Improve customer experience. Increase revenue. Whatever your industry, you are faced with ever-increasing expectations.

Our client teams have deep industry knowledge. Let us show you how technology can be strategically applied to transform your enterprise and differentiate your business.

Aerospace and defense

Automotive

Banking

Chemicals and petroleum

Communications

Consumer products

Education

Electronics

Energy and utilities

Financial markets

Government

Healthcare

Insurance

Life sciences

Media and entertainment

Metals and mining

Retail

Travel and transportation

The IBM- Daksh Leadership Team:

Pavan Vaish - CEO, Business Process Services

Chandrasekar Thyagarajan - CFO

Rohit Tandon - EVP, Strategy and Shared Services

Kulbir Singh Ahuja - EVP, Service Delivery

Chebiyyam V.V.N.S. Murthy (CHM) - CQO, IBM Daksh and MBPS Asia Pacific

Arvind Agrawal - EVP, Finance & Accounting (F&A) Practice

Tina Dhawan - VP, Mumbai BU

Sanjay Dora - VP, Service Delivery, Philippines BU

Lyndon J. D'Silva - VP, Banking, Financial Services, and Insurance (BFSI) BU

Subbiah Gopalakrishnan - VP, Technology

Shalabh Jain - VP, Bangalore BU

Rajat VK Kotra - VP, Transitioning and Project Management

Anuj Kumar - VP, India BU (IBU) and Talent Transformation BU (TTBU)

Nandita Jain Mahajan - VP, Information Systems and Security (ISS)

Ullal Narendra Nayak - VP, Sales and Business Development

Ravinder Singh Rana - VP, Pune BU

Dilpreet Singh - VP, Strategic HR

Sanjiv Tandon - VP, Technical Services BU

4. HP (BPO and IT Services):

HP Business Process Outsourcing services are delivered on a common platform that enables consistency, security and regulatory compliance. Our global reach enables a Best Shore approach that lowers labor cost while tailoring service delivery to your specific needs. Digital GlobalSoft acquired HP’s one wing HP ISO in July 2003 and it Offers potential growth opportunities for both Digital and HP Services.

HP Enterprise Services catalogs its services into three service portfolios which are,

Infrastructure Technology Outsourcing (ITO) - includes maintaining the operation of part or all of

a client's computer and communications infrastructure, such as networks, mainframes,

"midrange" and Web servers, desktops and laptops, and printers.

Applications Services - involves the developing, integrating, modernizing, and/or maintaining of

applications software for clients.

Industry Services, including Business Process Outsourcing (BPO) - addresses the core business

challenges of clients in five key industries: healthcare, transportation, communications,

government, and financial services, among others. BPO group is an integral part of the portfolio,

which involves performing a business function for a client, like payroll, call centers, insurance

claims processing, and so forth.

Horizontal services improve process efficiency and effectiveness for business functions common to all industries.

Customer Relationship Management (CRM) Services

Effective services that let you recruit, retain and reward your best customers anywhere in the world.

Document Processing Services

Comprehensive services that help customers efficiently manage documents throughout their lifecycle

Finance and Administration Services

Handle a variety of functions—from sourcing indirect supplies to collecting customer payments and performing cost and inventory accounting activities.

Human Resources and Payroll Services

Augment your staff with experienced HR and Payroll professionals who are trained to streamline operations while cutting overall costs.

Industry Specific Solutions

Industry-specific solutions bring specialized expertise, best practices and technology to key business processes in select industries. They include:

Communications, Media and Entertainment Energy Financial Services Health and Human Services Manufacturing Travel and Transportation

Executive team (There was no separate leadership team info for ITES/ BPO available on the internet)

Meg WhitmanPresident and Chief Executive Officer

Todd BradleyExecutive Vice President, Printing and Personal Systems Group

Dave DonatelliExecutive Vice President and General Manager, Enterprise Group

Henry GomezExecutive Vice President and Chief Communications Officer

John Hinshaw Executive Vice President, Global Technology and Business Processes

Marty HomlishExecutive Vice President and Chief Marketing Officer

George Kadifa

Executive Vice President, HP Software

Tracy Keogh Executive Vice President, Human Resources

Cathie Lesjak Executive Vice President and Chief Financial Officer

John F. SchultzExecutive Vice President and General Counsel

Bill VeghteExecutive Vice President and Chief Operating Officer

John VisentinExecutive Vice President, Enterprise Services

Chandrakant D. PatelHP Senior Fellow & Interim Director of HP Labs

5. Fidelity BPO Wing:

FMR India

FMR India consists of three business verticals - Technology services, Business Delivery and Enterprise Services, providing services to Fidelity Investments' US clients. The range of operations include IT Development & Support, Business Process Outsourcing (BPO), Implementation, Business Analytics & Research and Support functions.

 FMR India was set up in the year 2002 at Gurgaon and its Bangalore operations commenced in 2003, with the mission to enable Fidelity’s clients to achieve lifelong financial independence and peace of mind. Headquartered in Bangalore, FMR India has full-fledged operations Chennai also.

Fidelity Management and Research (FMR co.) founded in Boston by Edward C. Johnson 2nd to act as investment advisor to fidelity fund.

The global brand

Fidelity is an international provider of financial services and investment resources that help individuals and institutions meet their financial objectives.

 Once known primarily as a mutual fund company, Fidelity has adapted and evolved over the years to meet the changing needs of its customers. Today, that evolution is reflected in Fidelity's menu of products and services. In addition to more than 300 Fidelity mutual funds, Fidelity also offers discount brokerage services, retirement services, estate planning, wealth management, securities execution and clearance, life insurance and much, much more.

 

What hasn't changed over the years is Fidelity's commitment to continuous improvement, state-of-the-art technology and peerless customer service. Fidelity is responsible for many innovations that are standards in the industry today. Fidelity reinvests a substantial portion of its revenues each year back into technology to deliver new products and services to investors. And Fidelity is being consistently recognized by industry surveys and publications for providing some of the highest levels of customer support.

FMR’s locations in India

Fidelity Business Services India Private Limited

Pinehurst, Embassy Golf Links Business Park, Off Intermediate Ring Road, Bangalore 560 071 INDIATel: 080 6691 6000Fax: 080 4125 6260

 

Fidelity Business Services India Private Limited

Manyata Embassy Business Park, Outer Ring Road (Hebbal – Krishnarajpuram Section), Opp. BEL Corporate OfficeBangalore 560 045 INDIATel: 080 4033 5000

Fidelity Business Services India Private LimitedDLF Infocity Developers Chennai Ltd - SEZ,Block - II, No.1/124, Shivaji GardensRamapuram, Chennai 600 089 INDIATel: 044 4545 1200 / 01

The leadership team:

Edward C. Johnson 3d

Chairman and CEO , Fidelity Investments

6. GENPACT BPO:

Genpact Limited (NYSE: G) is a global provider of business process and technology management services, offering a portfolio of enterprise and industry-specific services. It was formerly a GE owned company called GE Capital International Services or GECIS. It operates from India, China, Guatemala, Hungary, México, Morocco, the Philippines, Poland, the Netherlands, Romania, Spain, South Africa, Australia, UAE, Brazil and the United States. Tiger Tyagarajan is the President and CEO of Genpact and has the highest paid salary package of Rs.49 Crores per annum.

Currently it employs over 55,000 people in various locations providing services in 25+ languages on a 24/7 basis.

Genpact's services cover areas like Finance and Accounting, Analytics & Research, Risk Management, Supply chain, Procurement, Enterprise Application Services and IT Information Services. Genpact serves clients in various industries including Banking and Financial Services, Insurance, Capital Markets, Healthcare, Life-sciences, Consumer Goods, Retail, Aerospace, Automotive, Energy, Hi-Tech, Transportation & Logistics, and Hospitality.

History:

Genpact went public on NYSE on August 2, 2007 under the symbol "G".

The NYSE symbol "G" was initially allocated to the Gillette company. After the Gillette Company was acquired by Procter and Gamble, the symbol became free and Genpact and Google booked it. It was Genpact in the end that got to keep G as its stock symbol.

Apart from GECIS, Genpact has also been known as GECSI and GECIBS in its initial days of operation.

Locations:

Genpact operates from Asia, Eastern Europe, Northern America, Latin America, Australia and Africa.

In India

Genpact, Uppal Hyderabad

In India it operates from Gurgaon, Noida, Delhi, Hyderabad, Jaipur, Kolkata, Bangalore and Dehradun. The operations in India are Finance and Accounting, Sales and Marketing Analytics, Customer Services, Financial Services Collections, Supply chain, Information Technology and Actuarial & Other Insurance

Services with Learning Content Development. Genpact has got an approval to open its SEZ center in Bhubaneshwar.II

Genpact has a 50:50 joint venture with NDTV in NGEN Media Services. Also has tied up with NIIT for training related services.

In México

Genpact Mexico provides bilingual English and Spanish-language based business services, near-shore services to North America and a significant document management capability. The Mexico operations have 2200 people in three sites – two sites in Ciudad, Juarez (sister city to El Paso, TX) and one site in Caborca. The core business competencies of Genpact Mexico lie in the areas of Customer Service, Finance and Accounting, Collections, Document Management. Mexico is a Strategic Site to handle Bilingual Call Centre and Non Voice Capabilities – mainly English and Spanish.

In USA

Genpact has assumed several accounting processes of Walgreens, the largest drugstore chain in the United States. It has acquired a former Walgreens facility in Danville, Illinois to accommodate these functions.

Through its wholly owned subsidiary formerly known as Creditek LLC, with facilities in Wilkes Barre, PA, Nashville, TN, and Parsippany, NJ, Genpact provides Finance & Accounting solutions Revenue Cycle Management services in such processes as order-to-cash, procure-to-pay and forecast-to-fulfill.

Genpact Mortgage Services, formerly MoneyLine Lending Services, provides private-label, outsourced mortgage origination and fulfillment services and complex business process outsourcing for financial institutions and other mortgage lenders from its centers in Irvine, CA, and Salt Lake City, UT.

In Guatemala

Genpact's facility in Guatemala was opened in 2008 and provides business process services in English as well as in Spanish. The delivery center will initially accommodate more than 700 workers and has the capacity to grow to approximately to 1,000. The facility's close proximity to the region's largest public university is a major advantage in terms of attracting key talent.[12]

In Hungary

Genpact Hungary, founded in 2002, operates in Budapest and has established itself as one of Europe’s premier business services and technology solutions providers.[citation needed] It currently employs staff from more than two dozen countries serving customers across Europe in over 15 languages.

In Romania

Genpact Romania, founded in 2006, operates in Bucharest and in Cluj.

In Netherlands & Spain

With the strategic acquisition in 2007 of Dutch and Spanish entities of ICE Enterprise Solutions, Genpact provides SAP solutions via centers in the Netherlands and Spain. ICE is an SAP Services Partner,

Utilities Partner, and BW/SEM Partner in the Netherlands, and an SAP Partner and StreamServe Partner in Spain.

In Poland

In June 2008, Genpact opened a new center in the Polish city of Lublin.Genpact Operations Centre located in city of Lublin is a finance and accounting operations centre which offers services to customers from Slovakia, Czech and Poland.[13]Decision about starting the centre in Lublin results first of all with good city location, close to other states in Centre and Eastern Europe. What is more Lublin – the largest city in eastern Poland - is known as a strong academic centre. Lublin is home to 14 universities, approximately 100 000 students and about 22 000 university graduates.[14] Therefore Lublin can assure suitable personnel backup and offers professional and experienced staff in finances and accounting, and also in management.

We are pleased with expansion our company in Poland. Opening of new centre is a large step in systematic enlarging our European operating possibilities” - said Patrick Cogny CEO Genpact Europe. First employees of new Centre became officially take on in June 2008 r. Centre in Lublin functions already in 100% and it develops continually.

In Africa

In 2008, Genpact set foot in the North African city of Rabat, Morocco.

In 2009, Genpact entered into a partnership with South African Breweries Ltd (SAB) assuming responsibility for its Shared Services Centre in Johannesburg, South Africa.

In China

Genpact in China, known as Jianbaite (in Chinese: 简柏特), has Service delivery centers in Dalian, Changchun and Shanghai. Among them, the center in Dalian is the largest, located in Dalian Software Park, employing about 3,000 people, and focusing on the Japanese business.

In Philippines

Genpact in the Phillppines has a BPO/Call Center branch located at Northgate Cyberzone, Filinvest Corporate City, Alabang, Muntinlupa City.

The leadership team:

Pramod Bhasin is the Non-Executive Vice Chairman and former President and CEO of Genpact.

Foundation of GENPACT:

Pramod started GE Capital International Services (GECIS) in 1997 as the in-house BPO division of General Electric (GE) when K.P. Singh convinced Jack Welch, the former CEO of GE, to outsource certain services to India at Gurgaon. It was under Pramod that GE hired Raman Roy, pioneered business process outsourcing in India, and expanded its operations from India to countries like China, Hungary, Guatemala, Poland, Mexico, Morocco, the Philippines, Romania, South Africa and the United States.

GENPACT began in 1997 as a business unit within GE and this lineage has contributed to our deep understanding of process. Starting first with the business of GE Capital and then expanding scope across GE businesses, to providing business process management capabilities that delivered outstanding business impact for the company.

Over a sustained 14-year period, Genpact has been the key provider of business process and technology management services to GE and they continue to be a significant Genpact client. In January 2005, Genpact became an independent company to bring our process expertise and unique DNA in Lean Six Sigma to clients outside the GE family. In August 2007, Genpact was listed on the NYSE under the symbol ‘G’.

Driven by a passion for process innovation and operational excellence built on its Lean and Six Sigma DNA and the legacy of serving GE for more than 14 years, the company’s professionals around the globe deliver services every day to its more than 600 clients from a network of 18 countries, 67 delivery centers supporting more than 25 languages.

Genpact has been an early mover in the industry and a pioneer in many of the areas that have given strength to the concept of Business Process Management. From the first to introduce Six Sigma for Process Transitions to the first to build a Science of Process Management (SEPSM), Genpact has always led the way, and in the process helped our clients outperform.

Innovation:

Genpact’s successful and incessant efforts in challenging the status quo and bringing innovation to our clients are demonstrated by continuous process solutions advances, such as those in analytics (e.g., inventory optimization or investor listening services based on social media methods), risk management (e.g., anti money laundering, or simulation of the impact of commodity costs) or business collaboration (through better platforms such as Genpact-Unified -Collaboration-Engagement).

Genpact is uniquely positioned to deliver business process innovation because of:

Its diverse yet cohesive client, partner and internal ecosystem. Like any great process, real innovation doesn’t happen in a silo and our approach benefits from a vast network of intelligence: in-depth collaborative development work with some of our best clients, select consultants and advisors; joint research with leading academia like the MIT Center for Collective Intelligence; our web-based SolutionXchange collaboration network of “crowd sourced” experts; our SEP innovation group, and our deep analytics bench; Genpact’s active Board of Directors; acquisitions such as Akritiv and EmPower Research.

Its unique innovation process with dedicated senior management. Our “innovation factory” consistently harnesses the power of our ecosystem, extracts needs and insights and combines Genpact capabilities to create repeatable, cost effective, configurable yet standardized innovative solutions to old and new challenges.

The Genpact DNA of Lean Six Sigma

Genpact is proud of its heritage of Lean Six Sigma—it is the way we work, a part of our DNA! Lean Six Sigma is a tool, a methodology for quality improvement that has been around for many years. So the difference is not the tool but how a company embraces it and puts it to work.

As a part of GE, Genpact was in an initial beta site under Jack Welch, who became known worldwide asa leading proponent of Lean Six Sigma. Lean Six Sigma was common in manufacturing but GE was an early innovator in its application to services and made this a tremendous success.

There are two types of companies when it comes to embracing Six Sigma. Those where it is simply a function and others where Lean Six Sigma is driven through the organization, which is true of GE and is clearly true for Genpact. It permeates what we do and is highly visible in our operations, our people processes, and our leadership direction.

Genpact’s offerings: (Solutions) Aftermarket Services Analytics and Research BPaas (Business Process as a Service) Collections Contact Center Direct Procurement Engineering Services Enterprise Application Services Finance and Accounting Human Resource Services Indirect Source to Pay IT- Infrastructure Services Learning and Marcomm Services Legal Services Media Services Re-engineering

Risk Management Services

Genpact’s offerings: (Industries)

Aerospace Automotive Banking and Financial Services Capital Markets Chemicals Consumer Goods Energy Healthcare- Payer Healthcare- Provider Hi- Tech Hospitality Insurance Life Sciences Retail Telecommunications Transportation and logistics

We have mentioned about the solutions and industries which GENPACT supports because GENPACT has not divided the company as technologies, BPO etc. They have divided as per ‘’Solutions’’ and ‘’Industries’’ and they do high end work in the services space. Since it all comes under the big umbrella of IT Enabled Services, we thought of including it in the company profile.

The management team

Genpact is managed by an experienced and cohesive leadership team. Many members of the leadership team developed their management skills working within GE and were involved in building Genpact. Our business leaders combine strategic, operational and financial experience with extensive relationships and expertise within target industries. Senior leaders have, on average, over 20 years of relevant experience.

7. ANZ Services/BPO

ANZ in India:

ANZ's operations in India are an integral part of ANZ’s global network comprising:

Australia and New Zealand Banking Group Limited (ANZ) in Mumbai

ANZ commenced banking operations in India with the opening of its first branch in Mumbai in June 2011. This follows the receipt of the banking licence from the Reserve Bank of India in October 2010.

ANZ is one of the 25 largest banks globally by market capitalisation1 and holds a long-term credit rating of Aa2/stable from Moody’s and AA-/stable from S&P.

The India branch supports Corporate and Institutional clients in India and provides greater access to the Indian markets for our global network customers.  

ANZ offers clients a full range of rupee and foreign currency products and services, working capital and term financing, cash management and trade products, foreign exchange and interest rate solutions, as well as deposits and advisory services.

ANZ Operations and Technology and ANZ Support Services India, Bangalore.  

ANZ Operations and Technology Pvt. Ltd. and ANZ Support Services India Pvt. Ltd. in Bangalore are an integral part of ANZ’s Global Services & Operations and Technology divisions.

In Bangalore, ANZ currently employs close to 5000 people in technology development, operations and shared services roles. The group has been servicing ANZ’s technology needs for more than 21 years and has in recent years extended its capabilities to include operations and support functions.

This division is led by Leanne Lazarus.

Company Profile:

ANZ’s history dates back over 175 years. We are committed to building lasting partnerships with our customers, shareholders and communities in 32 countries in Australia, New Zealand, throughout Asia and the Pacific, and in the Middle East, Europe and America.

Business strategy:

We aim to become a super regional bank. This involves growing our presence in the Asia Pacific region and source 25-30% of earnings from our Asia Pacific Europe and America Division by 2017, while also being very focused on growth in our core domestic businesses in Australia and New Zealand.

ANZ Executive

ANZ executive is made up of the Board of Directors and Management team.

In relation to corporate governance, ANZ's Board seeks to:

Embrace principles and practices it considers to be best practice internationally; Be an 'early adopter', where appropriate, by complying before a published law or

recommendation takes effect; and Take an active role in discussions of corporate governance best practice and associated

regulation in Australia and overseas.

As a company listed on the Australian Securities Exchange (ASX), ANZ is required to disclose how it has applied the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations (ASX Governance Principles) during the financial year, explaining any departures from them.

ANZ has complied with each of the ASX Governance Principles throughout the 2011 financial year.

Codes of Conduct and Ethics

ANZ has two main Codes of Conduct and Ethics which provide employees and Directors with a practical set of guiding principles to help them make decisions in their day to day work. The Codes embody honesty, integrity, quality and trust, and employees and Directors are required to demonstrate these behaviours and comply with the Codes whenever they are identified as representatives of ANZ.

ANZ Management comprises the Chief Executive Officer and ANZ's most senior executives. It meets monthly to discuss performance, to review shared initiatives and to build collaboration across ANZ. 

Chief Executive Officer

Michael Smith has been Chief Executive Officer of Australia and New Zealand Banking Group Limited (ANZ) since October 2007.

Until June 2007, Mr Smith was President and Chief Executive Officer, The Hongkong and Shanghai Banking Corporation Limited; Chairman, Hang Seng Bank Limited; Global Head of Commercial Banking for the HSBC Group and Chairman, HSBC Bank Malaysia Berhad. Previously, Mr Smith was Chief Executive Officer of HSBC Argentina Holdings SA and was subsequently appointed Chairman of HSBC in Argentina in 2000.

Mr Smith joined the HSBC Group in 1978 and during his 29-year career he held a wide variety of posts in Hong Kong and the Asia-Pacific region, the United Kingdom, Australia, the Middle East and South America, including appointments in Commercial, Institutional and Investment Banking, Planning and Strategy, Operations and General Management.

Mr Smith graduated with honours in Economic Sciences in 1978 from City University of London.

8. KPMG

KPMG in India is one of the leading providers of risk, financial services and business advisory, internal audit, corporate governance, and tax and regulatory services.

KPMG Global Services 

KPMG Global Services is a joint venture between KPMG International, KPMG in the UK & US and KPMG in India. Set-up in 2008 as a global capability center, KGS provides professional services to KPMG member firms.

With its broad portfolio of services and cross-functional capabilities, KPMG Global Services delivers on both immediate and long-term business imperatives for the global member firms by harmonizing its core Advisory services with the various Centers of Excellence to provide services using a flexible delivery model. Over 1300 high performing individuals work together to

respond to complex business challenges facing our clients by offering informed perspectives, and delivering clear solutions.

By working with us, member firms have successfully driven business value through acquisition of new capabilities, increased competitive strength, and an expanded global footprint.

 Services range from highly complex and diverse advisory engagements like shared services design, financial transformation, sourcing strategy, financial due diligence and information protection, to research based solutions like benchmarking and competitive landscape analysis, and advisory support activities like project management, bid and administrative support.

Types of Services offered:

Advisory 

Our practice teams are fully integrated with member firms’ professionals and assist clients in managing their business challenges. Advisory services span -

Management Consulting:

Our professionals combine deep functional expertise with industry knowledge to help clients address their business challenges. We work with clients to understand their key value drivers and assist them in achieving tangible improvements in performance. Our services lines include:

Business Effectiveness: Help clients to enhance operational efficiency by reducing operating cost, increase revenue and better manage their business assets.

Financial Management: Provide financial advice to enhance finance organizations’ performance and increase its business value associated with large transformation projects.

IT Advisory: Deep and varied experience from IT strategy and blueprinting to data analytics. People & Change: Work with HR organizations to achieve and deal with change by change

through dealing with people issues associated with large transformation projects. Benchmarking: We add value to client engagements across the advisory practices by providing

insights on how client performance compares against leading industry practices or global best practices. Once the performance gaps are identified, we identify potential areas where value can

be realized to optimize business performance both in terms of efficiency and effectiveness for the client.

Transaction and Restructuring

Mergers and Acquisitions (M&A) are amongst the most significant transformational events at a company and they form the life blood of investors such as private equity firms and other financial investors. To help our clients execute M&A transactions, KGS provides valuation, due diligence, and a variety of other services related to transaction execution, on both the buy side and sell side.

Corporate Finance: Advise clients in assessing strategic and financial alternatives. This entails preparation of an information memorandum, identifying potential targets and bidders, arriving at deal value and thus helping the client in achieving the synergies or returns expected through the transaction.

Restructuring: Identifying problem areas which can enable the clients to implement solutions precisely and quickly. Solutions include providing assistance to stressed and distressed companies, identifying under-performing businesses, and helping manage the receivership and bankruptcy processes.

Transaction Services: Analyze financial statements, conduct due diligence and make recommendations on investment risks and opportunities.

Business Modeling Group: We provide services across our advisory practices that include building, validating and developing documentation on complex financial models used across various sectors and end users.

Risk Consulting

We combine our deep service line skills and sector expertise to address our clients’ most complex challenges in the fast changing risk and regulatory landscape and to turn risk to advantage. Risk Consulting brings together Advisory’s Financial Risk Management, Forensic, and Internal Audit, Risk & Compliance service (IARCS) service lines as well as the risk and compliance components of IT Advisory. Current services include: 

 

IARCS:

Internal Audit & Sarbanes Oxley Assistance Services (SOAS): We monitor the management response to business risks and improve an organization’s effectiveness through audits of key business processes and controls. Contract Compliance Services: We help clients across a wide range of industries in identifying, recovering lost revenues and reducing costs in areas such as royalties, licensing, distribution agreements, conditional pricing arrangements and intellectual property protection.Regulatory Compliance: We leverage industry knowledge and regulatory capabilities to assist regulators, boards, and management in evaluating an entity’s compliance with applicable rules and regulations.

IT Advisory:

Information Protection & Business Resilience: We work with clients to assess, design, embed and manage controls to protect corporate information assets, align controls and business strategies and improve business resilience. IT Attestation - IRMea: We help external audit professionals in assessing controls risk and in dealing with complex technology topics in support of financial statement audits and integrated audits.IT Attestation - SAS70: We examine internal controls of outsourcing services providers and report out the state of controls against the Statement on Auditing Standards (SAS) No. 70, and other country equivalents.

IT Internal Audit: We provide advice over the risks and controls in the area of internet security, business application controls, project risk, and business continuity.

 

Tax Professional Services 

The KGS Tax Professional Services team has specialists with experience in Transfer Pricing, M&A Tax, Valuation, Global Compliance Management Services (GCMS), and Insurance premium tax.

Transfer Pricing

As the global economy expands, national fiscal authorities are seeking effective ways to protect their tax bases. This has translated into increased challenges for global companies who are looking for advice in dealing with the increased regulation and associated scrutiny.

The Transfer Pricing practice helps companies develop and implement economically supportable transfer prices, document policies and outcomes, and respond to tax authority challenges.

Our Transfer Pricing professionals provide a wide range of services including benchmarking studies, company overviews, industry analyses and a variety of other services related to transfer pricing.

Benchmarking studies are a necessary element of documentation confirming that the prices established by the taxpayer are in the range of the market prices. Benchmarking helps verify the prices and margins that are applied by related entities. Verification is aimed at checking if the controlled transactions’ conditions conform to the conditions of comparable transactions entered into by non-affiliated entities.

M&A Tax

The global corporate environment is a highly competitive landscape. To help our clients execute M&A deals, we provide Tax Due Diligence (Data Management and Report Writing), E&P studies (Data Collection & Analysis and IRS & Federal Tax management), Stock Basis studies, and Transaction Cost Analysis (TCA).

A Tax Due Diligence report involves financial analysis of a merging company by using advanced analytical tools to dig deep into the client’s financial information like P&L, Balance Sheet, Capital Gain/Loss, and Key Performance Indicators and then using this data to perform historical and current trending.

Valuation

In an increasingly global-scale business environment, the valuation issues surrounding mergers and acquisitions, financial reporting (i.e.; IFRS and US GAAP), restructuring, and tax planning/disputes have become more complex than ever. KPMG, with a global network of firms and great depth of experience, is well positioned to guide clients through these issues.

Companies seek valuations for corporate governance or regulatory reasons, or because management wants to have a better understanding of a particular asset’s value so they can make optimal decisions. In these instances, a company is often at a critical juncture - it may be planning an acquisition, resolving a shareholder or joint venture dispute, or seeking to reduce the gap between intrinsic and market value.

Our valuation professionals provide a wide range of services including business valuation, intangible asset valuation, employee stock option valuation, tangible asset valuation, report writing and a variety of other services related to valuation.

Global Compliance Management Services (GCMS)

Because of today’s economic challenges, many governments and municipal corporations around the globe are searching for ways to both increase their tax base and revenues through increased scrutiny. The higher regulatory burdens often leave multinational groups struggling to oversee local tax compliance, group tax reporting, and local statutory filings.

Our GCMS professionals provide clients with consistently high quality service by understanding their business strategy and needs and by providing a broad range of federal, state, local and international tax services to meet those needs.

The key services include Contracting, Global Tax Management System (GTMS) set-up, ongoing GTMS maintenance, proposals, project management, and fees & billing.

Insurance Premium Tax (IPT)

In addition to the regulatory burden, insurance companies involved in multi-jurisdictional risk coverage face the requirement to register for, collect, and remit tax collected on those international insurance premiums.

Our IPT professionals assist clients through transaction services, database management, and business effectiveness.

Centers of Excellence 

KPMG Global Services has several Centers of Excellence (CoEs) including Benchmarking and Modeling that cut across the various Advisory service lines.

Research, Analytics and Knowledge

We enhance the value delivered to KPMG clients by supporting our client-facing teams with applied research, analytics and knowledge support across a broad range of industries and domains.

Research: Our proposition comprises insightful business, market and financial research driven by our extensive understanding of primary, secondary, and analytical research methodologies and deployment of leading research resources. 

Analytics: We analyze complex data using advanced tools and techniques to enable fact-based decision-making to drive business advantage for clients. 

Knowledge Management: We provide end-to-end knowledge management services including content management, portal and collaboration site support to enable KPMG teams with the information needed to deliver solutions that clients value.

Advisory Development

We collaborate with KPMG Global Services Center’s Advisory Development team to develop a wide range of KPMG’s Advisory service offerings, with the objective of helping KPMG to:

Grow revenues Manage the firm’s risks Leverage internal knowledge and experience across practices and geographies Improve field efficiencies Drive global consistency 

 

We help develop the methodologies, services, tools and training that empower KPMG professionals to build deep client relationships.

Support Services

We support various groups within KPMG by providing a suite of services ranging from proposal writing, creative services including high-end graphic design, copy editing and formatting. In addition, we provide extensive administrative support to KPMG practice teams. Our team supports client engagements to demonstrate KPMG’s value propositions through the creation of impactful and high-quality documents that fully support the firm’s vision of cutting through complexity for the benefit of our clients and stakeholders.

The Advisory Executive Team 

KPMG in India - Office Locations 

KPMG in India has offices in Mumbai, Delhi, Bangalore, Chennai, Hyderabad, Kolkata, Pune, Kochi, Chandigarh and Ahmedabad with access to more than 4800 Indian and expatriate professionals.

Ahmedabad (GMT + 5 1/2)

KPMGSafal ProfitaireB4 3rd Floor, Corporate RoadOpp. Auda Garden, Prahlad NagarAhmedabad 380 015Gujarat

Phone: +91 79 4040 2200Fax: +91 79 4040 2244

Bangalore (GMT + 5 1/2)

KPMGMaruthi Info-Tech Centre11-12/1, Inner Ring Road

Phone: +91 80 3980 6000Fax: +91 80 3980 6999

KoramangalaBangalore 560 071

   KPMGSolitaire139/26, 3rd Floor, Inner Ring RoadKoramangalaBangalore - 560 071

Phone: +91 80 3065 4000Fax: +91 80 3065 4999

   KPMGLevel 12, World Trade CentreBrigade Gate WayDr. Rajkumar RoadMalleswaram WestBangalore - 560 055

Phone: +91 80 3080 3000Fax: +91 80 3080 3999

Chandigarh (GMT + 5 1/2)

KPMGSCO 22/ 23, First Floor,Sector 8-C, Madhya Marg,Chandigarh - 160019

Phone: +91 172 3935 781

Chennai (GMT + 5 1/2)

KPMGKPMG HouseNo.10, Mahatma Gandhi RoadNungambakkamChennai 600034

Phone: +91 44 3914 5000Fax: +91 44 3914 5999

Delhi (GMT + 5 1/2)

KPMGBuilding No. 10,8th Floor, Tower B,DLF Cyber City,Phase IIGurgaonHaryana - 122 002

Phone: +91 124 3074 300Fax: +91 124 2549 101

Hyderabad (GMT + 5 1/2)

KPMG8-2-618/2,Reliance Humsafar, 4th Floor,Road No.11, Banjara Hills,

Phone: +91 40 3046 5000Fax: +91 40 3046 5299

Hyderabad - 500 034

Kochi (GMT + 5 1/2)

KPMG4/F, Palal Towers,M. G. Road,Ravipuram,KochiKerala - 682016

Phone: +91 0484 302 7000Fax: +91 0484 302 7001

Kolkata (GMT + 5 1/2)

KPMGInfinity Benchmark,Plot No. G-1, 10th floor,Block - EP & GP,Sector - V,Salt Lake City,Kolkata - 700 091

Phone: +91 33 4403 4000Fax: +91 33 4403 4199

Mumbai (GMT + 5 1/2)

KPMGLodha ExcelusApollo Mills Compound,NM Joshi Marg,Mahalaxmi,Mumbai - 400 011

Phone: +91 22 3989 6000Fax: +91 22 3090 2210

Pune (GMT + 5 1/2)

KPMG703 Godrej Castlemaine,Next to Ruby Hall Clinic,Bund Garden Road,Pune - 411 001

Phone: +91 20 3050 4000

Fax: +91 20 3050 4100

   KPMGThird Floor, Building No. 07,Commerzone, Survey no.144/145,C. S. N. No.2684 and 2649 (Part)Yerwada, Samrat Ashok Path,Off Airport RoadPune - 411 006

Phone: +91 20 4019 4000

Fax: +91 20 4019 4003

9. Dell (BPO and IT Services)

Initially viewed skeptically by nonbelievers, the success of business process outsourcing (BPO) has surprised even its detractors, in delivering impressive transformational results for hundreds of corporations worldwide. The succeeding generation of BPO transcends process improvements and is making a fundamental impact on the customer's business. It is now possible to achieve integrated BPO capabilities spanning application development, consulting, infrastructure management and process management while incorporating industry-specific expertise and leveraging a global delivery model that represents a truly holistic approach. As an industry leader in providing Generation 2.0 BPO initiatives, Dell has proven its potential not only to transform business processes and align them with business strategy, but also to foster an environment that sets the stage for helping the customer achieve competitive advantage.

Solutions

Invest in Innovation

You've heard the adage "innovate or die," and in a hard-edged economy, it rings true. But innovation takes time, money and resources, as well as the ability to get ahead of the day-to-day IT tasks that can consume up to 80 percent of your IT budget.

So, how can you get ahead? By addressing critical pain points, such as simplifying maintenance and improving data center energy and space efficiency, which tie up your resources. It’s time to identify areas where you can build real efficiencies in your enterprise that enable you to invest in creativity, drive down costs and prepare your business to respond quickly and effectively to the latest technological, governmental and environmental trends.

From the desktop to the data center, Dell can help you find the answers you need. We offer services, solutions and technologies to help you address current needs while preserving your IT investment and maximizing your future growth. Stop the IT drain of the unexpected and free your business to realize its true potential.

Security

The cost of security breaches is staggering: According to some estimates, the average company spends $3.8 million a year responding. Learn how Dell can help you secure your network, data center, physical premises, endpoints and more.

Security Management & Strategy Network Security Endpoint & Mobile Device Security Application Security Physical & On-Premise Security

Business Continuity and Disaster Recovery

Maintain your service levels no matter what. Dell can help you avoid even seconds of costly downtime – whether from planned upgrades, and personnel changes, or unplanned disruptions like natural disasters or application failures.

Application Availability Business Continuity Enterprise Data Backup and Restore Disaster Recovery

Business Strategy & Process

Achieve your organization’s mission by meeting its dynamically changing needs with effective and efficient internal control and policy compliance.

Business Intelligence Customer Support Human Resources Operations Procurement

Infrastructure Efficiency

Achieve your organization’s mission by meeting its dynamically changing needs with effective and efficient internal control and policy compliance.

Business Intelligence Customer Support Human Resources Operations Procurement

End-User Productivity

Fully mobile and armed with an arsenal of portable technologies, your mobile, remote, third-party workforce creates value around the clock -- which means that your IT staff needs to support more than a simple desktop or laptop computing model. Dell can help.

Provide Actionable Business Insights Improve Communication & Collaboration Provide Job-Specific Hardware & Services Provide Education & Training Increase Workplace Flexibility

Governance & Compliance

The requirement for transparency in corporate governance, compliance and risk management is non-negotiable. But there’s a silver lining: With the right processes, people and technologies in place, you can radically increase business value.

Corporate Governance & Compliance Industry Compliance Regulatory Compliance Risk Management

IT Productivity

While technology advances, budgets diminish. Introducing new hardware and software is risky to your business. However, there are solutions to help you balance these requirements.

Improve Data Center Responsiveness Deploy Systems Faster Deploy Software Faster Resolve Issues Faster Simplify Maintenance Streamline IT Processes

Services

Whether you need help with strategy and deployment, require IT or business consulting, or want to explore managed services that take the load off your IT staff, turn to Dell Services for expert advice and world-class support.

Support Services

Protect your investments and keep your workforce productive with our configurable suite of support services. We provide efficient tech-to-tech assistance for IT professionals and reliable how-to support for end users.

Support Services Brochure Video: Dell Multivendor Hardware Support Multivendor Hardware Support

Application Services

Align applications with specific organizational needs and objectives, using Dell’s global delivery model and experienced industry and technology consultants.

UNIX to Linux Efficient Enterprise Workshop Oracle E-Business Upgrade Advisory Services Oracle E-Business Systems Health Check

Business Consulting

Find hidden opportunities for business growth, and reshape your internal processes and organizational structure to amplify agility, boost productivity, and reduce costs.

Consulting Services Overview Tech Hiring Creeps Back to Health Certification Crosstalk

Business Process Services

Identify business process inefficiencies then implement purposeful initiatives to streamline operations, improve productivity, and ensure compliance.

Customer Management Engineering Services Outsourcing Healthcare Revenue Cycle and Operations

Cloud-Based Services

Boost IT capabilities without adding hardware maintenance complexities and expensive upfront costs.

Cloud Service Close-up: Email Security Cloud Service Close-up: Email Archiving Cloud Service Close-Up: EMS Email Continuity

Configuration & Deployment

Simplify the integration of new high-performance systems — all preconfigured with custom images and well-packaged applications — so you can minimize disruptions in your workforce and remain productive.

Application Management Server Implementation Switch & Router Implementation

IT Consulting

Shape an efficient, effective and scalable IT infrastructure that adapts readily to your organization’s changing needs.

Dell Desktop Virtualization Workshop Dell Mobile Computing Workshop Unified Communications Workshop

Managed Services

Keep your key talent focused on strategic projects and greater innovation when you shift routine IT responsibilities to Dell.

IT Management in the Virtual Machine Era K-12 Managed IT Services Overview Telecom Expense Management

Training Services

Maximize your infrastructure investments by ensuring that your IT professionals and end users have the expertise required to manage and monitor your solutions.

Network Training Training Credits Dell Learning System (DLS)

Leadership Perspective from Dell

The BPO Generation 2.0 model defines a more complex, integrated solution that expands the definition of traditional Business Process Outsourcing (BPO) to include the capability to help customers attain a competitive edge.

Ahead of the BPO Curve: Dell

In 2001, BPO entrepreneurs grappled with a fundamental question: “What is going to drive value for the customer in the next generation of business process outsourcing?” My belief then was that the only way to deliver higher value to the customer was to move away from the myopic view of BPO as a separate silo. I saw then that only the integration of infrastructure management, consulting, and applications

development with business process outsourcing could achieve a holistic, successful business transformation strategy.

It was this conviction that prompted the sale of my company, Vision Healthsource, to Perot Systems Corporation (subsequently acquired by Dell), which shared my belief and offered the means to make my vision a reality. The key driver behind the transaction was the opportunity to not only strengthen competencies but also create integrated, holistic solutions. At that time, Vision Healthsource was a leader in healthcare BPO, offering best-of-breed tools and processes. By marrying Vision’s capabilities with those of Perot Systems, we leveraged the robust, holistic competencies in technology, infrastructure management, and consulting of both companies and manifested our vision for the industry, adding onshore centers and onsite work to broaden the resulting BPO capabilities even further.

Perot Systems’ acquisition of Vision Healthsource was a landmark transaction that created a unique, end-to-end healthcare business process services model. Since then, several other organizations have gone on to apply the same thought process and create global, integrated solutions delivery capabilities.

The leadership team

The Board of Directors is responsible for oversight and supervision of the overall affairs of the company. The Board maintains the following committees to assist it in discharging its oversight responsibilities.

Board members include:

10. Others

We have received some data from some other ITES companies in Bangalore. Since the sample size was not sizeable, we did not want to include a full fledged company profile for each of them. Here are the names of those companies. Some employees had past experience in some of the companies mentioned below. Since we had captured the data, we wanted to include the same in our project document. Most of the employees in the age group of 25+ have worked in more than one city (Bangalore, Hyderabad, Mumbai, Delhi, Gurgaon, Jaipur, Pune, Kolkata, Chennai etc). We have captured that information. Hence we are including the same in the study. Since ITES industry is a not a very matured industry and had started sometime in 1997 in Gurgaon (With GECIS, EXL, Convergys etc boom), and then spreaded to Mumbai, Bangalore, Hyderabad, Chennai, Pune, Kolkata etc. hence the young, dynamic and ambitious population shifted cities when they got better opportunities and better salaries etc. Some relocated back to their hometowns when ITES industry opened companies in their home towns. We have tried to capture the volatility of this work force. The data collected is from employees who are currently working in Bangalore, however most of them had worked in other cities in the past.

1. Honeywell BPO, Bangalore.

2. Ocwen BPO, Bangalore.

3. Tech- Mahindra- Satyam BPO- Bangalore and Pune.

4. Thompson Reuters, Bangalore.

5. Mainstay BPO, Bangalore.

6. Khodays BPO, Bangalore.

7. Working from home- Freelance BPO (Soft skills and customer service) trainer.

8. Synergie Education, Bangalore.

9. Syntel BPO, Mumbai.

10. Bank of America- Delhi.

11. Aircel BPO, Bangalore, Kolkata.

12. Tesco BPO, Bangalore.

13. Obopay Mobile Technology, Bangalore.

14. HSBC, Bangalore, Kolkata.

15. CompuCom CSI Systems Pvt. Ltd- Pune.

16. Cisco WebEx, Bangalore.

17. HTMT BPO, Bangalore.

18. Capgemini BPO, Bangalore, Kolkata.

19. Oracle BPO, Bangalore.

20. Tata teleservices Ltd, Coimbatore.

21. Essar BPO, Coimbatore.

22. HCL Infosystems, Chennai, Coimbatore,Gurgaon.

23. Hutch BPO, Coimbatore.

24. JP Morgan BPO Wing, Bangalore.

25. Integreon BPO- Mumbai.

26. Convergys India Services Pvt Ltd, Bangalore, Gurgaon.

27. ICICI First Source/ Firstring BPO, Bangalore.

28. TCS BPO, Mumbai.

29. Sparsh BPO, Bangalore.

30. Mphasis- EDS- HP- Bangalore.

31. AOL, Bangalore.

32. Vishnu Solutions, Kolkata.

33. Transworks, Bangalore.

34. Sitel, Mumbai.

35. V- Customer, Gurgaon.

36. Birlasoft- ITES- Kolkata.

37. Shyamala Consultants, Bangalore.

38. Wipro BPO, Bangalore.

39. Goldman Sachs, Bangalore.

Sample Size: We have taken a sample size of about 200 respondents spreaded almost equally among the companies. Since we work for Infosys BPO, the majority of the sample comes from there. However it can be taken as a neutral data, as the people change companies and the people who are today in Infosys BPO, they might have worked in other BPOs in the past. Hence the figures do not affect the results much.

The study areas covered for the analysis are Behavioral finance, portfolio management, and financial management.

Tools for data collection: We have used the questionnaire as a tool for data collection. We have used the same questionnaire to collect data as soft copy (using googledocs) and also took print outs of the same questionnaire and took hardcopies and then we manually fed the data for analysis.

Personal Tax planning for an Individual:

Some people have a wrong notion that tax planning is useful only once you are well settled in life. Rather, the best time to start tax planning is right from the day you start earning any income in your name.For any individual tax planning occupies a prominent position in the investment planning process.

Tax Planning: Everyone is entitled to so arrange his affairs to reduce his tax liability, but the arrangement must be real and genuine and not a sham. Thus tax planning ensures not only the accrual of tax benefits within the four corners of law but also that the tax obligations are properly discharged to avoid penal provisions. It should not be mixed with tax evasion and tax avoidance.

Tax planning at different stages of life through various Investments:

1. When a person starts earning by default the company s/he works for deducts the PF which is exempted from tax. Also Insurance policy (life Insurance, medical insurance u/s 80D and retirement plans) can be planned as deduction can be availed u/s 80 C.

2. Next stage is to own a house. The biggest advantage of putting your money in residential house property is tax haven in one hand while on the other hand; you get a secure place of your own to live in. The repayment of principal is deductible up to one lakh in a year u/s 80 C.3. Usually, a person has to spend a lot on the education of children. Tax planning can be used as effective tool in this respect as it may ensure that the capital base is not eroded or adversely affected. Sec 10(14) and rule 2BB provides for certain allowances that are exempt according to the limit specified in respect of each such allowances.

4. Senior citizens can invest special Senior Citizens schemes launched by govt. of India.Tax planning brings fiscal discipline in the functioning of a taxpayer and reduces the transfer of money, from the person who has earned it by hard labor, to the govt. for waste and ostentation. Thus the amount invested enhances the capacity of the taxpayers for expansion and growth, which in turn increases the tax revenue of the govt.

Objectives of the Study:

1. To examine history, growth and development of investment avenues in the city

2. To analyze investment pattern of ITES professionals in Bangalore city.

3. To find out the most accepted investment option in the city.

4. To offer suggestions on the basis of findings with reference to profitability, tax benefits, liquidity and risk.

Period of the Study:

The study on Investment pattern analysis of ITES professionals in Bangalore city is conducted for a period of about 1 year.

Limitations:

1. The findings of this study are based on sample size, so they can’t be generalized.

2. The research period is very short. So time constraint was a limiting factor.

3. Limited knowledge of respondents about the topic of the study was also a limiting factor.

4. The age group was very diverse. There were freshers with a CTC of 1 Lakh/Annum, and there were middle management professionals with a CTC of 20 lakhs/annum or so. All cannot be clubbed in one group as they view investments from a different perspective.

5. XXX

Literature Review:

Different types of Investment patterns/Different segments of the society who do investments and their ways.

The topic “A study on investment pattern of ITES Employees in Bangalore” is covered under behavioral finance. The researcher has reviewed the following literature for the study of the above stated topic.

We have searched the internet and we have found 6 different literature reviews which I would like to include in my research. They are as follows:

1. ASIAN JOURNAL OF MANAGEMENT RESEARCHOnline Open Access publishing platform for Management Research.

Done by: Gaurav Kabra, Prashant Kumar Mishra, Manoj Kumar Dash,PGH Student, ABVIndian Institute of Information Technology and Management, Gwalior,India

Assistant Professor, ABVIndian Institute of Information Technology and Management,Gwalior, Indiakabraiiitm@gmail.com

Topic: Factors Influencing Investment Decision of Generations in India: An Econometric Study.

2. Investment Patterns and its Strategic Implications for Fund Managers: An Empirical Study of Indian Mutual Funds Industry.

Done by: D. N Rao, Kings University and S.B Rao, All India Management Association. Date: January 19, 2010

3. Changing Trend of Investment Pattern in India and Emergence of Mutual Fund Industry[HDFC Asset Management Company]

Done by: Sheeba Lole, MBA II SemesterShree Amreli Jilla Leuva Patel MBA College Of WomenAmreli–365 601 GJE-mail: vijaypithadia@lycos.com

4. WORKING PAPERS ON INTERNATIONAL INVESTMENT. Investment Patterns in aLonger-Term Perspective.

Done by: Stephen Thomsen, Date: April 2000

5. WORKING PAPERS ON INTERNATIONAL INVESTMENT. Investment Patterns in aLonger-Term Perspective.

Done by: Stephen Thomsen, Date: April 2000

6. On Being a Woman: How Our Differences Shape Our Investment Techniques

Done by: Nicole Alper

7. Savings and Investment pattern of IT Employees of Bangalore.

Done by Prof. Hema Doreswamy of Welingkar Business School.

Synopsis:

After reading all the five studies done by different groups/individuals of scholars, I have tried to analyze their findings and present my view point. I have tried to search for different investment patterns among Indians and by international people. I have found that many scholars have worked on the emergence of ‘’Mutual Fund Industry’’ in India. Also I have found an interesting research of investment pattern of women.

In the first research, where the topic is ‘’ Factors Influencing Investment Decision of Generations in India: An Econometric Study’’, I have realized that the team has researched on the age old methods of investments. This study aims to gain knowledge about key factors that influence investment behavior andways these factors impact investment risk tolerance and decision making process among menand women and among different age groups. Today the field of investment is even more dynamic than it was only a decade ago. World event rapidly events that alter the values of specific assets the individual has so many assets to choose from, and the amount of information available to the investors is staggering and continually growing. The turnover rate in investments should exceed the inflation rate and cover taxes as well as allow you to earn an amount that compensates the risks taken. Savings accounts, money at low interest rates and market accounts do not contribute significantly to future rate accumulation. While

the highest rate come from stocks, bonds and other types of investments in assets such as real estate. Nevertheless, these investments are not totally safe from risks, so one should try to understand what kind of risks are related to them before taking action.

In this Paper the team has examined some common reasons for investing.In this Paper we are trying to find out

Factors which affects individual investment decision. Difference in perception of Investors in the decision of investing on the basis of Age. Difference in perception of Investors in the decision of investing on the basis of Gender.

This study follows the survey research methodology. Based on previous research in related areas,a questionnaire was constructed to measure the investment pattern of individuals on the basis ofAge and Gender. After pilot testing, the questionnaire was administered to a group of peoplewhom age is more than 22 years. Here we are using minimum age as 22 years since we areconsidering that an individual starts earning after this age. The data were analyzed using standardtechniques of factor analysis, Regression analysis and other basic techniques.

The target groups chosen for this study were the investor, who regularly invests. They will investfewer amounts but invest regularly according to their earning. The target groups include varioustypes of Investors such as on the basis of areas whether they belong to rural or urban areas. Onthe basis of Profession whether they are working in Government or Private Sector and On thebasis of annual income and annual amount they invest.

A four page questionnaire consisting of six subscales was developed. In the first subscale,demographic information such as age, gender, marital status, region to which they belong,profession, individual income levels were sought. In the remaining five subscales, questionswere adapted from similar instruments reported in the literature by previous researchers tomeasure the investment pattern of individuals on the five variables under consideration, viz.investing background, opinion leadership, Duration of investment, Awareness of Investments,Security. They have done an extensive literature review which included reviews from International scholars like Statman (1988), Barnewall (1988), Langer (1975) etc as well as Indian scholars like Karthikeyan (2001).

Details of respondents

No. Of respondents Percentage (%)

Age22-28 233 51.10%28-40 180 39.50%40-60 43 9.40%

GenderMale 270 59.20%

Female 186 40.80%

Profession

Govt. Service 134 29.40%Private Service 212 46.50%

Professional 110 24.10%

Annual Income

1.5-3 Lakhs 44 9.60%3.5- 5 Lakhs 212 46.50%

Above 5 Lakhs 200 43.90%

Hence the team had taken a good mix of the variety of people based on gender, age group, income group and profession. At the end of the study it was concluded that the modern investor is a mature and adequately groomed person. In spite of the phenomenal growth in the security market and quality Initial Public Offerings (IPOs) in the market, the individual investors prefer investments according to their risk preference. For e.g. risk averse people choose life insurance policies, fixed deposits with banks and post office, PPF and NSC. Occasions of blind investments are scarce, as a majority of investors are found to be using some source and reference groups for taking decisions. Though they are in the trap of some kind of cognitive illusions such as overconfidence and narrow framing, they consider multiple factors and seek diversified information before executing some kind of investment transaction. The purpose of this study was to determine whether the variables such as demographic characteristics (age, gender) and investment patterns could be used individually or in combination to both differentiate among levels of men and women investment decisions and risk tolerance and develop some guidelines to the investment managers to design their investment schemes by considering these views of individuals.

In the second research, where the topic is ‘’ Investment Patterns and its Strategic Implications for Fund Managers: An Empirical Study of Indian Mutual Funds Industry’’, the team has analysed about the mutual fund industry in India.

The mutual fund industry in India presents an interesting scenario of 48 million investors, a large variety of product offerings and coexistence of private, public and foreign Asset Managing Companies. The study, adopting the classification of investors and categorization of funds by Association of Mutual Funds in India (AMFI) empirically researches the investment patterns of the five investor groups in the eight fund categories; examines the portfolios of the investor groups to identify their propensity for specific fund categories and identifies the dominant investor groups in terms of quantum of investment and investor folios.

The significant findings of the study have been that (a) Corporates are the dominant investor group in the Indian Mutual Fund Industry and they account for almost 48% of the total investment (AUM) in the industry and they are more oriented towards non-equity funds which offer high security & liquidity and hence their propensity towards Liquid/Money Market and Debt-oriented funds; The second dominant group in the industry is the Retail investors’ group which accounts for almost 24% of the total investment (AUM) in the industry, while they account for 98% of the 48 million investors in the industry. The portfolio of this group is highly skewed towards equity oriented schemes (almost 80%) which offer high return, capital appreciation coupled with high risk and 18% of the portfolio accounts for Debt-oriented and Balanced funds.

There were 34 pages in the PDF file, however I was unable to read all the 34 pages as the entire material was not available on the internet. I am trying to the PDF file from the scholars who had worked on it.

Source:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1538491

In the third research, where the topic is ‘’ Changing Trend of Investment Pattern in India and Emergence of Mutual Fund Industry, the researcher has come up with a few interesting findings. This project is about how the Investor's Behavior is changing and they are now leaving behind the sacred investment options like the fixed deposits, company deposits, gold etc. Investors are now looking towards equity linked investment options.

Like most developed and developing countries the mutual fund cult has been catching on in India. There are various reasons for this. Mutual Fund makes it easy and less costly for investors to satisfy their need for capital growth, income preservation. And in addition to this a mutual fund brings the benefit of diversification and money management to the individual investor, providing an opportunity for financial success that was once available only to a select few.

In this project the researcher has given a brief about economy, inflation, and equity and debt market. Then it is explained how to cope with the inflation and how mutual fund is one of the best investment options today. A brief about mutual fund industry and the some information about HDFC Mutual Fund and its various products are also given.

A mutual fund is a pool of money, collected from investors, and is invested according to certain investment objectives. The term mutual means that investors contribute to the pool, and also benefit from the pool. There are no other claimants to the funds. The pool of fund mutually invested in by investors is the mutual fund. A mutual fund's business is to invest the funds thus collected, according to the wishes of the investors who created the pool. In many markets these wishes are articulated as "investment mandates". Usually, the investors appoint professional investment managers, to manage their "product", and offer it for investment to the investor. A Mutual fund belongs to the investors who have pooled their funds. The ownership of the mutual fund in the hands of the investors. Investment professional and other service providers, who earn a fee for their services, from the fund, manage the mutual fund.

The researcher had done a comparison of FD, FI Bonds and Mutual funds in terms of accessibility, tenor, tax benefit, liquidity, convince and transparency and found that Mutual funds give good returns to the investors.

T

The researcher did not collect any first hand data from the individuals/investors, and her research is based only on the research of how Mutual Funds have evolved over the years and how the Government policies have impacted its growth in our country. She has concluded by saying, ‘’ So, if you are looking for an investment product that offers you low risk of capital loss and the potential to earn reasonable returns in the uncertain environment of today, HDFC Multiple Yield Fund might be the right fund for you.’’. It looks like she had contacted the HDFC Asset Management Company to do her research and she wants to advertise about HDFC Mutual Funds.

Source: http://www.indianmba.com/Occasional_Papers/OP72/op72.html

In the fourth research, where the topic is ‘’ WORKING PAPERS ON INTERNATIONAL INVESTMENT’’. Investment Patterns in a Longer-Term Perspective, the researcher Stephen Thomsen has focused on long-term patterns and has demonstrated how FDI (Foreign Direct Investment) has evolved from an

FDs FI Bonds Mutual FundAccessibility Low Low Low

Tenor Fixed (medium) Fixed (Long) No lock in periodTax Benefit None Under section 80C None

Liquidity Low Very Low None Convince Medium Tedious Very High

Transparency None None Very High

activity largely undertaken by large multinational enterprises (MNEs) located in a handful of countries into a global phenomenon.

Both trade and investment have grown rapidly in the past five years relative to economic growth morebroadly. There have been periods of rapid FDI growth before, such as at the beginning and end of the1980s, which were subsequently interrupted by economic recessions in major economies.

The upward trend in FDI flows can also be interrupted temporarily by a decline in global growth. Like any form of investment, FDI is affected by the business cycle. Slower growth in home countries reducesinvestor profits at home which could have been used for acquisitions abroad. Figure 2 compares growth in OECD inflows with real growth in OECD countries since 1971. Economic growth influences both the “supply” and “demand” for FDI. Slower growth in the home country reduces both earnings and equity prices and hence limits the pool of capital available for expansion abroad. Similarly, recession in host countries lowers the short-term profitability of a potential investment.

Cross-border mergers and acquisitions (M&As) are estimated to account for no less than 60 per cent of the total value of global investments, or 80 per cent of FDI in the United States and 85 per cent in Australia.

To conclude what we can say is evidence on long-term trends suggests that the 1990s represented not so much a watershed as an acceleration of trends already underway. Many firms from developing countries are now important foreign investors in their own right. We cannot use this study much as a literature review, because it does not focus on individual investors. It focuses on the trends of investment patterns of large companies and midsized companies in different geographies and different economic status.

In the fifth research, where the topic is ‘’ On Being a Woman: How Our Differences Shape Our Investment Techniques, the researcher Nicole Alper has done a brief study of the investment patterns of women and how they are different from the investment patterns of men. She has not done any elaborate research of the trends; neither did she collate data via sample questionnaires. However I wanted to include this in our research because it deals with a different segment of the society, ‘’Women’’.

According to Ruth Hayden, author of How to Turn Your Life Around: The Money Book For Women, many of the more appealing "female" characteristics, such as patience, tenacity, and pragmatism make us better investors than men, once we actually get started. "Women have an intuitive sense. They are practical and understand that things work in stages and are therefore comfortable with volatility. And once they're in the market, they'll stay put."

If a woman's patience is her virtue, then riding out the peaks and valleys of an ever-changing market should be her pay off. After all, according to most financial planners, it is those investors who stay in it for the long-term who reap the full benefits of the market. Women normally do not believe in rapid return philosophy. They do not invest in risky instruments which might yield profits overnight; however sometimes lose out on lucrative opportunities.

But according to a survey on women's investment patterns conducted by Merrill Lynch, women are not doing what they need to for total financial independence and retirement. In fact, far from it. The statistics are worrying: 48% of women vs. 38% of men do not feel knowledgeable when selecting between investment options; and only 49% of women (vs. 62% of men) say the total amount of their savings and investments are greater than the total amount they own on any consumer debt.

Women, because they earn less and live longer, need to be planning for retirement early and aggressively. Ruth says this is more common than people think. "Men jump in fast. Women often just don't jump. There are two things that prevent a woman from getting started: experience and knowledge."

Professor Hersh Shefrin, the Mario L Belotti Professor of Finance at Santa Clara University and author of Beyond Greed and Fear: Understanding Behavioral Finance and the Psychology of Investing, agreed that popular psychology studies depict women as "more collaborative" and "sharing" by nature. Hence women invest much better if they are in a group, and they exchange information. Also if their partners are accommodative, then women invest much better.

According to Professor Shefrin, "women should pick a sensible mix of index funds, including bonds and foreign stocks," in order to achieve their goals. "They need to invest for the long-term and limit the amount invested in individual stocks to under 10% of their portfolio."

Even though this paper was a 3 page one, which was based on Ruth Hayden’s book and some surveys done by Merrill Lynch and Professor Hersh Shefrin and this cannot be taken as a full- fledged research, however this gives us an insight of the investment patterns of women.

In the sixth research, where the topic is ‘’ Savings and Investment pattern of IT Employees ofBangalore’’, Dr. Hema Doreswamy has done an extensive research on this topic. She took this as herM.Phil paper, and hence in her 93 page long research, her study and research was in-depth. The study tries to understand the behavior of people while making investment decisions by studying the behavior of software professionals in Bangalore city.

The primary investment options available before globalization were life insurance, fixed deposits, shares and debentures, PPF, post office savings scheme etc. But now the options are plenty. There are a number of private insurance players in the market, who offer ULIP products which are widely in demand. Real estate is also most important investment option as capital appreciation is very high. Apart from these there are many options like American depositary receipts, global depositary receipts, mutual funds, general insurance, commercial paper, stock and debentures etc. Whenever an investor is investing his savings he has to keep few things in his mind like liquidity, profitability, risk, and tax benefit etc.

The researcher has collected data from 8 software companies as follows:

1. Wipro Technologies2. Infosys 3. Mind tree Technologies4. Honey well5. Cap Gemini6. HP Technologies7. Huvavi8. HCL technologies.

There are different methods of classifying the investment avenues. A major classification is Physical investment and Financial investment. They are physical, if savings are used to acquire physical assets, useful for consumption and/or production. Many items of physical assets are not useful for further production of goods or create income as in the case of consumer durables, gold, silver etc. But most of the financial assets, barring cash are used for production or consumption, or further creation of assets, useful for production of goods and services.

Modes of Investment:

There are different types of securities conferring different sets of rights on the investors and different sets of conditions under which these rights can be exercised. The various avenues for investment, ranging from risk-less to high risk investment opportunities consist of both security and non-security forms of investment. All securities forms given below are marketable.

A. Security forms of Investment. 1. Corporate bonds and debentures- convertible and non-convertible 2. Public sector bonds- taxable and non-taxable3. Preference shares4. Equity shares-New issue, rights issue, bonus issue

B. Non-Security forms of Investment. 5. National savings scheme6. National savings certificate7. Provident fund- statutory, recognized, unrecognized, public provident fund8. Corporate fixed deposits- public and private sector9. Life insurance policies10. Unit scheme of Unit trust of India (Some are marketable among these)11. Post office Savings Bank account12. Others- relief bonds, Indira vikas patra, kisan vikas patra13. Deposits in Banks, commercial and cooperative societies- Recurring and time deposits14. Mutual funds.

Exchange traded funds: (ETFs) are a new variety of mutual fund that first became available in 1993. ETFs have grown rapidly and now hold nearly $80 billion in assets. ETFs are sometimes described as more 'tax efficient' than traditional equity mutual funds, since in recent years, some large ETFs have made smaller distributions of realized and taxable capital gains than most mutual funds. This paper provides an introduction to the operation of exchange traded funds.

REITs (Real Estate Investment Trust) are companies, which own properties such as office buildings, shopping complexes, hotels etc, that are giving continuous income.

Features of investment avenues:

1) Risk.2) Return.3) Safety4) Liquidity5) Marketability6) Tax Benefits

Risk-return Relationships:

Risk and return are directly correlated with each other, when risk high return is also high and vice versa. This is depicted in the below chart.

Table no 2.2

Table showing the relationship between risk and expected return

Instrument Risk Expected return.

Bank deposits 5% 8%

Mutual funds 15% 20%

PSU BONDS 20% 30%

Non convertible debentures 25% 35%

Convertible debentures 30% 40%

Equity Shares 40% 50%

Company deposits 45% 60%

Venture Capital 50% 70%

Profile of Software Industry in Bangalore:

A large part of India's success in the software sector is due to the crucial role played by the State of Karnataka in promoting and providing a boost to IT. Karnataka has emerged as the computer capital and center of high-tech industries, especially software. Bangalore has for long been known as India's answer to Silicon Valley, and this is the city where most large software companies have set up shop and operate out of state-of-the-art facilities.

The City of Bangalore has positioned itself to help market the software industry. This is also why Bangalore has been playing host to international-class conferences, workshops and exhibitions devoted to the software cause. The city has the highest number of engineering colleges in the world, almost 50 percent of the world's SEI CMM Level 5 companies; COPC/ISO recognized Customer Interaction Centers, and over 103 R&D Institutions. It is, in fact, home to GE's biggest R&D Center outside the U.S.-the Jack Welch Technology Center, which hires over 200 PhDs/scientists every month! To top it all, Bangalore has just been ranked the fourth best "Global hub of technological innovation" by none other than the United Nations.

Then the researcher has described in details about the profile of the 8 companies which she has chosen. We are not including it in the synopsis as it is not required to know in details about the company profiles. We are aware of the fact that all the companies are software companies.

DATA ANALYSIS AND INTERPRETATION:

This study is basically conducted to know the Investment pattern of software professional in Bangalore city. The questionnaires were used to collect the data and in this chapter analysis is done for the study based on the filled in questionnaire and interpretation is given there by. The parameters used for the analysis are:

1. Sample Size: 200 (Software professionals from different companies located in Bangalore city)

2. Age Group

3. Income level

4. Level of savings

5. Investment options

6. Factors considered for investment.

7. Level of satisfaction.

8. Consultancy services etc.

Table showing age profile of respondents

Particulars Number of respondents

%

25 years to 30 years 128 64

More than 30 up to 35 years 64 32

Above 35 years 8 4

TOTAL 200 100

Source: Primary data

The researcher has done detailed research on the age profiles, composition of males and females, education backgrounds, Investors perception about growth of investment avenues after globalization, perception of investors towards risk reduction with available investment avenues, appropriate family income per annum, number of dependents, annual savings, Investments in various options, factors considered before investing in the order of preference, house/apartment/ land through bank loan, EMI being paid on house loan, car owned through bank loan, EMI being pain on car loan, investment in life insurance plans, investments in mutual funds, investment made for children’s Education, investment made in General insurance (property insurance, loan insurance etc), investment in pension funds and many other factors. She has done detailed Analysis and Interpretation of each component and has provided with graphical representation of the same. There is a table for each and every component, and then there is a graph depicting the number and percentage of people who have invested in that instrument.

Summary of findings, suggestions and conclusion:

This study is conducted to analyze the investment pattern of software professional in Bangalore city. The major findings from the analysis made are as follows.

The overall findings of the study are:

It is found that the overall growth of the investment options available is very good. There are lots of investment avenues available through which the investors can maximize their returns and minimize their risk.

The researcher has found that investing in real estate, life insurance and Jewellary rank high in respondent’s portfolio.

It is evident from the study that the savings of the respondents is less compared to their income level.

It is found that the factors which predominantly affect respondents while investing are risk, return and tax exceptions,

The researcher has a detailed list of specific findings which we can study in length. However we are not including the same here. Anyone who is interested in the findings can go through the actual project.

Suggestions:

1. It is suggested that the respondents should meet financial consultants/ advisors before deciding their portfolio as being software professionals their knowledge about these areas will be limited.

2. It is suggested that the respondents should increase their savings as savings is very less compared to the family income.

3. It is suggested that the respondents can go for other general insurance like the property insurance, loan insurance to cover risk for the assets in future.

4. It is suggested that the respondents must go for investing in pension funds as majority of them do not have pension benefits in their current jobs.

5. Lastly, it is suggested that the respondents should reduce their investment in jewellery as even though capital appreciation is there, they don’t fetch any periodical returns.

Conclusion

To conclude that the researcher on the basis analysis done finds that there are lots of investment options available for all kinds of investors like risk averse, risk takers, moderate investors etc. The investors should rightly select the investments in such a way the risk is hedged properly and the return is also maximized. The investors should update themselves to properly analyze the investment options before going for investing.

Why we chose this topic for our project:

After doing the literature review, we realized that not too much of work has been done in the area which we have chosen. Investment pattern of ITES (Information Technology Enabled Services) employees in Bangalore. The ITES industry itself is a young industry in India. It started in about 1995 in Delhi and NCR with American Express which had a small outsourcing division where they used to do some backend data processing for the American Express customers. GE (General Electric) came to India in 1998 and set up its center in Gurgaon and along with it many other big players like Convergys, EXL and many other companies slowly came to India with their outsourcing work. Initially India was looked as a cost cutting hub as the infrastructure costs were much lesser than in the U.S. India being a densely populated country, with the young population in the rise, and English speaking graduates were available in abundance in the major cities posed a good option for voice and non-voice outsourcing work from the U.S.

There were Indian companies like Specramind (Which was started by Raman Roy and a few other brilliant entrepreneurs in 2000, and which was taken over by Wipro in 2002-2003), Daksh eServices Pvt. Ltd. (Which was started by Sanjeev Aggarwal and Pavan Vaish in 2000, and which was acquired by IBM in 2004) etc. also played a significant role in the growth of the ITES industry in India.

Between 1998-2000, there was a huge growth of the BPO (Business process outsourcing, also known as ITES) industry in Delhi, Gurgaon, Noida and adjoining areas. There were more than 200 companies (which included big companies like GE, Amex, Convergys, EXL, Daksh, Spectramind etc. and many small mushrooming companies) in Delhi and NCR. However slowly post 9/11 (Twin tower blast which happened on Sep 11, 2001 in the US), the companies moved into the BCP mode and they realized that they need to open centers in other cities too. Also there was a problem of transportation, safety and space in Delhi and NCR and the companies started looking for other cities to open their centers.

GE had opened its center in Jaipur and Hyderabad. Hutch had its center in Delhi and Mumbai. 3G had its center in Mumbai and later in Pune. Spectramind also had a big center in Mumbai. There were many midsized companies like Trackmail, Transworks (Later which was acquired by Aditya Birla), E-Serve (Citigroup), Zenta, Sitel, GTL etc. which were set up in Mumbai due to the availability of English speaking and net savvy crowd available, however due to infrastructure problems (Home pick up and drops are must in this industry due to the odd working hours and a large population is of women), most of the big companies did not open their centers in Mumbai.

All the companies were looking for a good destination for opening their centers and Bangalore came up as the most viable option. In the year 2002-2003, most of the big companies started opening their set ups in Bangalore. The climate was good. There were a lot of engineering and graduate colleges in Karnataka and Bangalore and English speaking and modern crowd was available. AOL had set up its operations in Bangalore in 2002. Firstsource (Initially it was established as ICICI Infotech Upstream Ltd. By ICICI Bank in 2001) was one of the few renowned BPOS in Bangalore which started its operations in 2001. The name was changed to ICICI onesource in 2002 and the company acquired Customer Asset, First ring, Revit and expanded in the US, UK markets and diversified the company portfolio. Digital GlobalSoftacquired HP’s one wing HP ISO in July 2003 and it Offers potential growth opportunities for both Digital and HP Services. Progeon was established in April 2002 as the BPO subsidiary of Infosys Technologies

and today is among the top third party BPOs in India according to NASSCOM. It was started as a 74% and 26% joint venture between Infosys and Citibank Investments. In 2006 Infosys bought out Citibank's share at a price of Rs 592 per share. Today it has operations in Bangalore, Chennai, Gurgaon, Bhbaneshwar, Jaipur and many other Indian Cities along with international centers like, Monterrey, Mexico, Lodz, Poland, Brno, Czech Republic, Atlanta, USA, Hnagzhou, China, Manila, Philippines, and Brazil. Accenture originated as the business and technology consulting division of accounting firm Arthur Andersen. Through the 1990s, there was increasing tension between Andersen Consulting and Arthur Andersen. In Aug 2000, Andersen Consulting was renamed as Accenture. On January 1, 2001 Andersen Consulting adopted its current name, "Accenture". The majority of Accenture employees are organized in one of four "workforces" (Consulting, Services, Solutions and enterprise) and they chose to open their BPO wing in Bangalore in April 2003. Today it gives services to the customers all across the globe from different locations in India and abroad. IBM, HP, Dell, Cisco, JP Morgan, GE Capital, google, yahoo, Fidelity, 24/7, AEGIS, Altisource, Tesco and many other MNCs opened there BPO centers in Bangalore and Bangalore became the ITES Hub of India. Due to lack of time, I am not including the introduction of these companies. However it was great to see Bangalore emerging as an ITES hub.

Slowly the companies also opened centers in Hyderabad, Kolkata, Chennai, Pune and many other tier two cities like Mysore, Coimbatore, Trivandrum, Lucknow, Ahmedabad, Mangalore, etc. now BPO/ITES is a full fledged industry in India and Bangalore has the maximum number of the Fortune 500 companies which have their set ups here. Hence this study is of utmost relevance in today’s scenario.

Trend Analysis:

After doing the trend analysis for 200+ data (Krishna please put the exact figure after totaling 118 samples of mine + 44 of Bhavani’s and X of Merlin’s) I have come to a conclusion about a few things about the way the employees at different career levels and ages of BPO industry save and invest:

1. Most of the BPO employees when they join the industry in Bangalore, they are 20-21 years old. The minimum qualification required is graduation/diploma (10+2+3) in most of the reputed MNCs and hence the students who do not want to study further/ do not have the opportunities to study further join the BPO industry. They get a good brand name like Infosys BPO, Accenture BPO, IBM BPO etc., get all the facilities like Gym, swimming pool, recreation facilities etc along with transport facilities. They get health insurance an life insurance (Free of cost in some companies and at a nominal cost for the entire family in some others) from the company. They get fast career growth, opportunities to do further studies like MBA/PGDBA/ MS/PMP/CCNA etc. and all the good companies support the employees in these. They get opportunities to go onsite through the company (US, UK, Canada, Australia etc. ) if they are good performers and they get good growth and compensation packages and incentives. When the BPO industry started in 1997 in India (With GECIS, Gurgaon, EXL, Convergys being the key players), youngsters were skeptical to join the BPO industry. There were night shifts and the way our Indian Mentality. However with time the industry stabilized in India and the high end jobs started coming to India. There was a ‘’sinking skills ladder’’ and slowly now KPO (Companies like KPMG, Medical Transcription Companies etc- Sparsh BPO, GE Analytics, a lot of innovation in IBM, Intel etc. is done by ITES employees) and LPO (Legal process outsourcing (Companies like Infosys BPO, Accenture BPO have LPO units where lawyers are hired), highly specialized jobs for healthcare industry where doctors, medical analysts, bio-medical students, bio-tech students are hired.

2. I got to know that GENPACT has Exec MBA with IMT- Ghaziabad, Accenture has it with ISB- Hyd, XLRI, Symbiosis etc, IBM BPO has with Sikkim Manipal Univ, IIM- Khozikode etc. Infosys BPO runs the maximum numbers of programs for its working junior management executives. We got this excellent program with Welingkar business school. Infosys has tie ups with IIM-A, IIM-B, Sikkim Manipal Univ., Symbiosis, IIM- Joka (For Sourcing and Procurement Management and supply chain management) and many other institutes. So many people, who were unable to do a full time MBA for different reasons, join the ITES industries and then get rigorously trained for their required skill sets. People have become voice resources ideally for taking calls (Simple processes to highly complex processes like router support- Cisco TAC team, to giving support to GE Med systems – owned by GECIS- GENPACT).

The data resources get enormous exposure to the F & A, S & P, CME, MFG, HRO & Payroll, Healthcare, BFSI, Collections and many other environments. They become excellent in analytics, excel skills and are great in producing excellent PPTs and running Macros and doing highly skilled jobs. Hence the ITES industry is playing a vital role in ‘’India Shining’’.

3. We collected data from various educational backgrounds (B.E/B.Tech, B.A (Arts), B.Sc, B.Com, B.Sc – IT/BCA, BBA, BBM, BHM, MBA- Finance & Actuarial Sc, MBA- International Business and Int. Relations. MBA/PGDBA, M.A (Arts). M.Com, M.Sc (PCMB), MCA/M.Sc, PHD, C.A etc. So the common myth which people have that only people with less skills, and less educational background only join the ITES industry was broken. There were six sigma certified professionals, PMP Certified Professionals, Dip (Mech), ITIL, CCNA, MCSE, CCIP Certified professionals and many others with many other certifications. Many of them had come from manufacturing industry (Typically in the quality teams with GB, BB and MBBs) and have blended into the service industry and are creating values for the clients. We found that GECIS/GENPACT runs six sigma projects and saves millions of dollars every month. Accenture has an Opex model (Operational Excellence) and they run on lean- Six sigma model. All the projects there are first certified by the quality team and high level charts and SIPOCs are created before the go-live. Infosys BPO runs many programs to enable employees to take up YB, GB and BB projects and saves millions of dollars for the clients. There are similar models in the other BPOS too.

4. I came across 1 employee from Accenture BPO who had done his PHD in English literature. He was in the training team of Accenture BPO and he was a part time lecturer in Bangalore Univ. I came across another profile from Infosys BPO who is pursuing his PHD in Mgmt and he too is a guest lecturer in one of the B. Schools in Bangalore. Hence the myth of having less education was broken.

5. There were many PMP certified professionals who are into Pre-Sales and Project Management. There are CCNAs, MCSEs, working with HP, Dell, IBM etc. in very high end Infrastructure Support or Network support teams. They are remotely monitoring the networks of their clients in different geographic locations.

6. And I came across one profile from Accenture BPO who has done his Full Time MBA from ISB. He is in the senior management of Accenture- BPO handling multiple geographies. Another FT MBA from an Univ. of Australia is working with ANZ and providing business analysis to the bank. There was one more profile in Infosys BPO who was working as an agent in Accenture BPO, took a FT course from Narsee Monjee- Actuarial Sc. And now is working with Infosys BPO’s pre-sales team.

7. There were 3 C.As- one with Capgemini, One with Accenture BPO and another with Infosys BPO. They are all at the senior management- leadership teams.

8. There were M.Sc (Biotech), B.E (Biomedical), B.E (Instrumentation), B.E (Aeronautical Engg.), B.E (Comp Sc./ IT) etc who did not get jobs in their fields and then had joined the BPO industry. Many had moved to the highly skilled healthcare specialization of the BPOs and the rest had

move to tech-support, quality, sourcing and procurement processes.

9. Most of the employees had joined as graduates are doing their MBA/PGDBA through the company exec MBA programs of distance learning programs run by different companies. We observed the hunger to learn and come at par with their other counterparts in IT industry or the business execs who had done FT MBA and were handling businesses.

10. There were X male respondents and Y female respondents (Krishna- please total everyone’s numbers). It is not that there are less women working in the BPOs, however since we did random sampling- hence we spoke with our friends who were in different genders. And a few women were skeptical about sharing their financial data also. However if we look at the statistics, we will find that at the junior management level, in the ITES industry it is almost equal employment between men and women. It is at the middle management and higher management positions, we could not find data from too many women.

11. We had a good mix of income groups. We observed that when an employee joins the ITES industry, since most of them come from other cities to work in a different city, in the first two years they are unable to do much savings. They have to take a house on rent (Mostly on sharing basis or P.G) and spend on monthly maintenance. However from the third or the fourth year of work, when their salaries are taxable, they start investing to save tax. Most of the employees open PPF accounts/ Take life insurance policies and start their investment portfolios.

12. We found that most of the women invest on gold/silver/platinum etc. However mostly it was in the form of jewellery, not bullions. Most of them buy them on occasions like marriages, diwali, Akshay tritiya etc.

13. Investing in paintings is a new investment option. I was trying to find among the respondents whom I spoke with during my data collection, if anyone has invested in paintings. However I could not find any respondent answering ‘’Affirmative’’ to that question.

14. We found that many young employees in the age group up to 30 especially in Dell, Accenture and IBM spend a lot of money in parties, shopping and buying gadgets (Laptops, playstations, mobiles, cameras etc.) They take vacations using their credit cards/ Personal loans/ EMIs and believe in the philosophy of ‘’Live life King size’’ on credit. And live for today. However employees in Infosys and HP were more prudent in savings. We felt that the reason was that most of the employees of Infosys BPO come from small towns and are not used to the city life style. Hence they do not go out much on the weekends and spend the hard earned money on liabilities/ depreciating assets. Most of them have to send money to their hometowns, and hence they are more prudent with money. However in companies like Dell, Accenture and IBM come from middle class, upper middle class and they do not have many responsibilities on their shoulders. Hence until they plan to get married and start a family, they do not care much about savings and investments. Most of the employees in their 30s and early 40s had mentioned that they too had done that mistake when they had started their careers 10-15 years back and had learnt the hard way. We also felt that they were influenced by the US culture of borrowing money and surviving on credit cards as they closely work with the Americans and people from the western world who have an affluent life style. Most of those employees had ignored the instructions given by their parents, relatives and well wishers and had fallen heavily into the Debt trap.

15. However we were happy to see that most of the employees whom we had interviewed were oriented towards investments. However we cannot use this as an absolute data. Since the work cultures of companies as mentioned above affect the spending/ investing pattern, hence there are disparities in our data collection. We depended heavily on the Infosys data as we are working in that company. And the age group interviewed in Infosys was mostly between 25-30- the spending and savings patterns were different. Most of the respondents from the other companies were in the age group of 30-40; hence the spending and investing pattern were different.

16. We also observed the difference in investing pattern of employees staying with families. Since they did not have to spend on rent, maintenance much, they were able to invest in real Estate at a very early age. However people from other cities, towns and villages had different challenges as most of their salaries were spent on rent and maintenance. Also they were interested to invest in a property to save on the rent and use home loan as a tax planning method, however it was difficult for most of them to buy a house/flat with the limited income they had in the ITES industry. However a few had invested in cheaper properties in Attibele, Anekal, Devanahalli, B.G Road extn, Whitefield etc. Since post recession, the property rates have stabilized in Bangalore, many are able to invest in properties- especially dual income families. However many had faced problems while buying the property and a few had gone into litigation too.

17. However most of the employees, who had once fallen into the Debt trap, became cautious later, paid off their debts, tore off their credit cards and started investing wisely. That was a positive trend. 2008’s recession was another big lesson for the ITES employees who realized that even though we get our salaries on time, however many had lost their jobs, and the fluctuation in the market had affected their spending patterns. I spoke with a few ex-employees of Satyam who had lost their jobs after Satyam fiasco. Also many who had lost their jobs in Goldman Sachs, First Source, Accenture and other companies due to recession, health reasons, and family contingencies had to quit and take a break etc. They all had learnt their lessons and had started clearing off their debts and had started saving and investing. They realized that even though they were aping the US culture, however Indian Govt. does not give unemployment benefits like the US Govt. and there is no social security after retirement. Hence they started saving and investing.

18. Then we realized that most of the employees prefer ‘’Medium Risk Medium Returns’’. This goes well with the Indian mentality. A few liked high risk high returns and we came across only 1 female who was interested in ‘’High Risk high Returns’’. Mostly men were interested in that and they were mostly aggressively investing in the equity market and mutual funds. We also saw that such employees were investing in real estate and many had more than one property- one for living and one for earning rental income.

19. We realized that employees start saving in FDs and Govt. bonds in the first few years of their careers and all of them were continuing investing in FDs every year. Most of the people who invest in FDs keep a target in invest a certain amount every year in FDs and happy with the safe haven of investment.

20. Mostly employees do not take up separate health insurances and they depend on the company provided insurance. However many prefer to have a separate life insurance in spite of having company provided life insurance. Also the trend to insure the entire family with one insurer was observed. That assured lower premiums and better benefits. However we realized that comparatively smaller companies like Aircel, Obopay mobile tech, Tata Teleservices, CompuCom CSI Systems Pvt. Ltd, do not for pay life, and health insurances.

21. We observed that most of the people were reluctant to take insurance for home contents, however most of them had taken home insurance for the building (against natural calamities and EMI protection against job loss etc.). We did not explore the option of car insurance much due to lack of time.

22. Since most of the data was collected via phone, face to face, we got a good insight of the investment patterns of the employees. The responses which came through e-mails were mostly incomplete/ not much information was provided. At many instances we had to call the employee again to verify/collect some data.

23. Most of the respondents are investing between 15-25% (Krishna- collate the entire data and check).

24. Most of the employees in the age group of 30+ prefer to invest in long term instruments. Some invested in medium term FDs and MFs. Very few people prefer short term investments. This was in sync with the Indian mentality of ‘’Let the money grow and we can use it later when we need to make some big investments/ marriage/ child education, property etc.

25. We did not see many employees investing in Govt. Bonds. Also investment in the equity market is very less. (Krishna please put the exact %)

26. Most of the people who have children have the main goal of investing for children’s education. We saw a positive trend that many employees who are planning to get married in the future and have children in the future also are investing prudently keeping in mind about the child education.

27. We did not see too many women who have invested into property on their own. Most of them were co-owners of properties with their husbands and were using the same in claiming tax benefits. Even though we did not have a column for ‘’Marital status’’- while talking to the respondents- we realized that women who were single were mostly investing in FDs, gold/silver, Insurance and a very few in real estate, MFs and equities. However men who were single were also interested in investing in properties keeping in mind that they will get married in the future and it will be an asset. However the majority of the population who were married only were real estate owners.

28. There were a few employees investing in RDs, or had left their money in Savings A/C without investing in any instruments. Some had invested in Chit funds too.

29. In future most of the employees want to invest in property. Even the employees who had a home in Bangalore were ready to invest in Pune, Coimbatore, Mysore, Trivandrum, Gujrat and other upcoming cities. Some wanted to invest in other cities because their parents live there and they want to build a house for them. However many wanted to invest in the upcoming cities where IT-SEZ parks will come up and they will get good returns later. Many had bought lands in other cities and waiting for them to appreciate, and they have plans of selling them. A few had bought properties and had converted them into P.Gs to earn extra rental income. There was one profile from Accenture BPO who had bought 3 properties. He wants to do an MBA from the top 5 B-Schools in India and he does not want to take loans. Besides he comes from a very humble background and his family cannot support him financially during his two year program. Hence he invested wisely so that the 3 rental incomes can take care of his and his father’s expense during that time.

30. There was a good number of population who wants to save for tax planning. However most of them were individuals in their early career levels earning less than 5 lakhs per annum. People earning more were interested in creating wealth, retirement, child education, property etc.

31. There were quite a few respondents who were saving for their own/ siblings marriages. Many women did not want to put the burden on their fathers and were saving for their own marriage. Men were mostly doing that, or the ones who were married, many stated that when they got married, they had spent from their savings. Their families had contributed little/no money for the expenses. Even honeymoon was planned by the husband and wife and in dual income families, both had contributed for the same.

32. There were many respondents who want to save for higher education like FT/ PT MBA, Six sigma courses, ITIL, CCNA etc. They were an ambitious lot who believe in the philosophy of ‘’Learning till we are alive’’. Many want to go to the US/UK/Australia- or have already gone there for higher education (Mostly MBA/ MS). Some lost their jobs in the UK, Australia, Middle East during recession and came back to India and again started working here. Most of them had started their career in Bangalore, went abroad for a few years- some for studies and then started working and some went for work and simultaneously studied and then came back to Bangalore and are working in the ITES industry here.

33. Most of the people were skeptical with disclosing the ‘’Total amount’’ of investments they have. 3 profiles were more than 1 Crore. One of them is a C.A, above 50- in Accenture leadership team. Another was an MBA from ISB- Hyd in the age group of 30-40. Another was a young guy in his 30s who had started his career with a basic B.Com degree in GECIS Gurgaon- did six sigma certifications, and then moved to Accenture Bangalore and joined the Quality team at an Asst. Manager level and now is at a senior management level. Even though his salary and age is much lesser than the first 2 employees, his risk appetite is so high that he invested so well and increased his portfolio to more than a Crore which is commendable. He did his MBA and many other certifications while working and has proven the myth that people with better education can only have wealth. The rest all had savings in different ranges which we can check from the analysis in the graphs. More or less we were convinced that the employees are investing, however they can save and invest much more as they are young and are earning well. However we realized that most of the young BPO professionals below the age of 30 are unable to save due to high maintenance cost (Most of them are from outside Bangalore) and due to their spending habits in parties, shopping etc. However most of the respondents who are 30+ had already done those mistakes and are saving and investing prudently. We found a few of them with very high income and very low corpus.

34. We realized that investment was more to do with habit than knowledge. We realized that people from commerce background and finance background had a better knowledge about the different investment instruments; however it is the habit and discipline which determines the portfolios. A few employees used professional help from different investment firms as their knowledge was not up to the mark, and were doing very well in terms of investments. And we observed that many employees who did not have the habit or discipline of investing, were not doing it in spite of earning huge sums.

35. We saw that many respondents have taken home loans. The reasons they stated for taking home loans were:

Tax saving on the principle amount. Making an investment which will appreciate with time. Many mentioned that in the last few years when the stock markets have crashed, only

property and gold have been safe heavens for investors. Many mentioned that their properties have appreciated 100%-400% in 5-10 years. No

other instrument has yielded them such results. Many mentioned that during the global recession between 2008-2010, when the property

rates were low in Bangalore, they invested in properties from SJR, Purvankara, Shobha and other developers which they could not afford to buy before 2008.

Many mentioned that property rates were sky rocketing between 2002-2008 when the IT boom came to Bangalore; hence they could not buy anything. However during recession the rates stabilized and they could invest in a decent property of their choice. Plus in 2002-2004 when they came to Bangalore from other cities and towns, they were in the entry level positions and their salaries were less. However they made up their minds to stay back in Bangalore and hence chose to buy properties here. Many got married and bought properties in joint name along with their wives in dual income families.

Many mentioned that they could not afford to buy properties in Bangalore. Hence they bought properties in Coimbatore, Trichy, Pune, Kolkata etc. where their families reside.

Many mentioned that for investment purposes, they bought properties in Bhubaneswar, Trivandrum and other upcoming cities and they have put them on rent/ waiting for the prices to go up and they will sell them off.

36. We also saw that a huge percentage of employees have taken car, bike loans. The reason they stated was, due to Bangalore transport system (The buses are not available in many routes and post 8 PM the Auto drivers charge exorbitant amounts), many had to buy a vehicle even though they could not afford it. The petrol prices have hiked and that has affected their budgets. Many

accepted that these are depreciating assets and taking them on loan was not the best option, however the situations forced them to do so. Many mentioned that on weekends to take the entire family in a bus for a movie/ dinner was cumbersome as the buses do not ply on all the routes. One has to change two or three buses to reach a destination. However many mentioned that after the Bus day was started by one of the FM channels on 4th of every month, many have started taking company provided buses to go to work. Many have even started to use cycles to reach their work places. Most of the people mentioned that they prefer to stay close to office to save themselves from traffic jams, long time to commute and have a better quality of life. This was a positive trend we observed. Many mentioned that they use cars only on the weekends when they go out with their families for outings.

37. Many had mentioned that they have taken a personal loan or credit card loan and many have credit cards which they try to pay off every month, but are unable to do so. Many understand the repercussions of revolving credit and many are aware that they are paying 40-45% annually for credit card interests, however many are unable to control their expenses. Many in their 30s specially working in Accenture, IBM and Dell mentioned that when they were in their 20s, they had over-spent on credit cards. To clear off those debts, either they had taken personal loan, or they had done balance transfer from one credit card to the other. Many mentioned that they had 5-7 credit cards earlier and they were heavily into debts. But with time they realized that they need to change their lifestyles and need to pay off their balances and live a credit free life. However many of the respondents are still unable to curb their habits and are spending a lot on credit cards and getting into debt traps. And most of them mentioned the reason for using credit cards were partying, shopping and buying gadgets. Many accepted that they took the cards thinking that they will use them in emergency (All the big hospitals in Bangalore accept credit cards, credit cards give cash advance facility) however could not keep a check on their spending habits.

38. Most of the respondents mentioned that they do investments once a year during the financial year end for tax planning. Some mentioned that they do investments once in every six months (FD, Gold/Silver, Bi-yearly insurance plans, RDs, Govt. Bonds and equities). And some aggressive investors invest once a month. Most of the respondents who invest once a month have a monthly PPF, monthly RD, or monthly insurance schemes. Most of the respondents said that they save money every month and after 4-5 months convert them either into an FD, or some pay MF premiums, or buy gold/silver during festivals. Some even make part payments for their home loan principles as floating home loan rates have gone up in the last few years and many want to pay off their home loans ASAP. Very few respondents who invest in equities mentioned that they do it on a monthly basis and keep a strong eye on the market on a daily basis and ask their stock brokers to invest regularly on their behalf.

39. Most of the respondents chose ‘’Medium Risk Medium Return’’ (Krishna please add the numbers). We observed that the respondents who chose ‘’High risk high returns’’ mostly had exposed themselves to the equity markets directly or through mutual funds. They also had invested a lot in real estates and had bought more than one house/flat and were earning rental income. All the respondents who chose ‘’High Risk High Return’’ were men with an exception one woman. (Accenture BPO employee- Age 25-30).

40. Many respondents had responded ‘’yes’’ to the question ‘’ Have you ever suffered a loss due to investment of money?’’- Most of them had lost money in Equities, MFs and a few in short terms ULIPs. Two ladies mentioned that due to the home loan interests going up, they are paying a lot more in the interests. One lady mentioned that she had purchased ‘’silver’’ on the advice of someone as silver rates were going up. But when she realized that the prices were going down, she sold it in the fear of losing more money and incurred losses.

41. We observed that most of the respondents had started saving after 3-4 years of their jobs. There were some exceptions that had started saving and investing from their first pay checks. We

realized that families played a vital role in inculcating the good habit of saving and investing. Parents had given guidance to the young professionals and many professionals especially women did not bother to do investments on their own. They just sent money home and allowed their fathers or brothers take care of their investments. However where the employees had come from different cities and the families did not insist them to save/invest had mostly gone into the Debt trap. We realized that employees from humble backgrounds were more prudent with savings and investing than from employees from affluent or middle class families.

42. The employees who were staying with their families in Bangalore were more into saving and investing as they did not have to pay the rent and they could save a huge chuck of their salaries. Even for the food, electricity bill etc. since they were living with their families, they did not have to bother much. Hence many of them managed to invest in properties, FDs etc. a huge chunk of their salaries. Even if they were extravagant, it did not affect them that much as it was only about 25% of their salaries they were spending on parties, shopping, vacations etc.

43. Most of the people chose ‘’ Secured Future for self and family/ Good health/ Happy Retirement’’ as the main advantage for investing. The next percentage mentioned about ‘’ Increasing Wealth/Good Returns/Hedges inflation/Helps to realize long term goals’’. Long term goals included buying expensive furniture, gadgets like LCD etc. taking vacations in exotic locations etc. Some of them had a long term goal like buying an expensive car, villa, marriage of self or children, education of children etc.

44. We realized that the respondents who had children were very concerned about the future and education of their wards. All of them wanted to invest diligently for their education etc. Most of them had already taken plans for the education and had taken good insurances covering the entire family. Many of the BPO employees were interested in upgrading their skill sets and were constantly taking up programs on six sigma, CCNA, ITIL, MBA, MCA, PMP and many other courses. They believed that spending on education is like an asset which will yield returns later.

45. Many respondents wanted to ‘’Save for the rainy day/ contingency’’ like any major illness to self or family members. A few of the respondents had to leave jobs or take long sabbaticals due to health issues or self or father/ mother/ spouse etc. During those months they had faced difficulties as they did not have any income and the expenses were huge due to hospitalization and the medical insurance only takes care of the hospitalization. Many other expenses have to be borne by the family. During recession many respondents had lost jobs or during Satyam fiasco many had lost jobs and they narrated their bad experiences and now they have become more prudent with savings and investments.

46. Most of the respondents below the age of 30 with the income less than 5 lakhs wanted to invest to get the tax benefits. However many were not aware of the different tax instruments and the process to declare it to their respective finance teams in their companies. However people with higher income group were more interested in creating wealth, safeguarding the future of self and family and children’s education.

47. There were many respondents who wanted to invest money so that they can generate alternate sources of income. During the recession and otherwise in MNCs since the job security is low, the employees had realized that even though they get good salaries and perks, they need to invest aggressively to take care of any contingency in today’s ever changing environment.

48. A few mentioned that they want to invest as ‘’Investing is a good habit’’. A few mentioned that ‘’It increases the knowledge of the market.

49. To the open ended question ‘’ What do you think about the disadvantages of investing money?’’, most of the respondents answered ‘’None’’. Indians as a community give a lot of importance to

savings and investing and the same flair was found in the group of ITES employees irrespective of the fact whether they were able to invest or not. Only a few respondents mentioned that they live for the day and do not believe in saving for tomorrow. We followed that most of them come from very affluent families and many of them want to join their family business at a later stage in life. Now they are just enjoying their lives in Bangalore without the restrictions of their families.

50. Some others mentioned that ‘’Cash in hand/liquidity reduces’’ when they have to invest. And they cannot live a lifestyle which they want and can to take luxurious vacations and spend on the things they want to buy now. They have to invest, wait for the money to grow and then they can buy it. Most of the people were not happy with the wait and sometimes used to fall in the debt trap.

51. Many respondents were unhappy with the market conditions and mentioned that even after investing aggressively, there were no guaranteed returns and there was always a chance to lose money. They were upset with the returns received lesser than expected and were unhappy that the plans they had made were affected. Most of the people wanted to take the risk in the equity market, but looking at the volatility, were not able to take the risk. Many had bitter experiences with investing in ULIPs, MFs and equities. Even property market was not safe as many got into litigations etc. as they could not buy dispute free properties.

52. To the question ‘’ What are the problems you face while investing?’’ most of the respondents said none. Since our data had a huge number of commerce graduates, BBM/BBAs, PGs, CAs, ICWAs, MBAs, MBA (Fin) etc. and the others from other backgrounds also had a good knowledge of the market as they watch NDTV Profit, read newspapers and various financial journals. A few take consultations from investment consultants too. Hence the awareness levels regarding investments were high. However the ones who were spendthrifts, in spite of having knowledge about investments were unable to do so. I spoke with a respondent who was a CA Inter, and had all the requisite knowledge was in a debt trap. He was about to be married shortly and he was mentioning that in the last 2 years he has paid off his credit cards. However he is still paying off his personal loans and for his marriage he will have to take more loans.

53. The next biggest issue was ‘’lack of proper guidance’’ ambiguity in products and the sales exec selling those policies hiding most of the vital information and fooling the respondents. Most of the respondents faced problems in buying MFS and shares and ULIPs. Buying a litigation free property in the budget was the biggest challenge for most of the respondents. And most of them mentioned that property dealers/ developers/ builders too advantage of their lack of knowledge and many of them faced problems as the properties were not ready on time. Hence they had to pay the EMIs and house rents and it was a huge burden on them.

54. Most of the respondents who were married and their wives were not working had mentioned that one person’s earning is not enough to survive comfortably in Bangalore and even though they want to do proper investments, they are unable to do so. Most of the sensible couples had first settled down in Bangalore, got themselves secured in their jobs, and then had bought a property and planned for a kid at late 20s or 30s. Since the salaries are not at par with the IT industry, however the property rates are very high; the ITES couples had to struggle a little more and took longer time to plan their families.

55. Many respondents mentioned that ‘’ Difficult to part away with lump sum amount for good instruments’’. Many mentioned that they are unable to invest in the product/ property of their choice- hence they have to go for the second best option. Maintaining a discipline and investing on a regular basis was also a challenge for many. Many respondents had mentioned that they had broken FDs to take vacations, or buy some expensive gadgets etc. Later they had regretted a bit, however for them at that point of time their family’s happiness was more important.

56. A few respondents mentioned that ‘’ What should be the optimum investment even if we set a realistic ROI’’. Many were unable to set the upper limit for their investments from their salaries. If they were investing too much then they had to curb their day to day desires which was difficult, and if they were investing little, then they were worried about contingencies and future.

57. Some respondents found it difficult to understand the fine prints (The documents for the fin. Products)/ Premium allocation charges. They found the fine prints very ambiguous and lot of ** which mentioned a lot of exclusions which they were not comfortable with.

58. A few respondents mentioned that ‘’ can’t save enough money to invest/ Always end up paying a lot of tax.’’ Most of the respondents below 30, and with single earning household mentioned this.

59. A few women who were from affluent families also did not have the tendency to save/invest as they knew that their fathers and husbands will do the needful. They were spending their money doing shopping, partying, spending lavishly for a good lifestyle. However most of them had realized the importance of investments post recession and had started doing good investments.

60. For the question ‘’ What percentages of your salary you spend for monthly maintenance/Expenses?’’ most of the respondents mentioned between 35-50%. The respondents who spend less than that are mostly either living with their families, or have invested in a property and are paying huge EMIs. We had excluded the property EMI from this calculation. So monthly expenses included food, electricity bill, telephone bill, petrol bill newspaper bills etc. which were their compulsory monthly expenses. It did not include buying any big gadget/ furniture, paying for vacations etc. in that question. This was to assess the monthly budget of ITES employees and to assess their saving and investing patterns. Most of the employees who mentioned above 50% are spending huge amounts on house rent and most of them are single person earning and other dependants on him/her.

61. There were a few respondents who were single mothers (Divorced/ widowed). They were finding it very difficult to manage with the single income and manage the expenses of the child. One of them is not even getting proper alimony from her ex-husband. And two of them had quit their full time jobs and were working from home as they had to take care of their young children. Those mothers sounded very responsible and concerned about the futures of their children in today’s volatile situation. Most of their parents were supporting them emotionally; however they were not comfortable financially.

62. I had one respondent who was visually challenged, Infosys BPO. He mentioned that he finds it very challenging to go to banks and different financial institutions to do his transactions. The websites he accesses for collecting data is not friendly to visually challenged. Also the documents which he has to sign before taking up a policy is not in Braille, hence he has to always depend on his family for his investments. He also mentioned that a large part of his salary goes in his medications and he has separate health insurance and he sounded quite concerned about his future.

63. Most of the respondents who had small kids had a lot of challenges. Most of the women/wives after child birth had to take sabbaticals as in nuclear families they did not have enough support to leave their child and come to work. Also work from home option, which is available in the IT Sector is not available in the ITES sector. Hence the household income reduced after the childbirth as the woman had to take a break and the expenses increased as the childcare in Bangalore is very expensive. I found most of the couples struggling with small children with the expenses and their savings and investments were badly depleted during the initial few years after the child was born, till the woman joins back. Most of the time it is challenging for her to join back after a gap of 2-3 years and they might get again entry level jobs.

Suggestions:

After analyzing the data, checking the ‘’Limitations’’ of the project and checking the ‘’Key Findings’’ of the entire project, here are a few suggestions we would like to make to the employees of the ITES industry:

1. We feel that since the higher education policy is very good in the BPO industry (Please refer to point no. 2 in ‘’Trend Analysis’’), all the employees should avail it. Instead of complaining that the salaries are lower in the ITES industry compared to the IT industry, they should avail the courses of their choice. All the companies give 50-100% concession in the course fees and the management gives full support (like the employee is not engaged in work during the class hours, some companies provide transport if the classes happen in the Univ. Campus, leaves for preparation for the exams etc.). They should look at the cost of these courses in the market and the concession they are getting because of being an employee of such MNCs. Also most of the companies give promotion and progression/ role change to the employees who go for higher education through the company’s HEP/Exec MBA programs. These are all ‘’Learn while you Earn’’.

2. Employees should not only look at vertical growth, but also should look at lateral movements. Many a times vertical growth is not possible But ideally any ITES company has pre-sales/ solution design, operations, HR functions, Training and Development, Finance, Quality and facilities. Within operations- there are so many horizontals like F & A, S & P, HRO, Customer Service etc. And so many verticals like CME, MFG, BFSI etc. Within quality there is Transactional Quality, Six sigma/lean, Quality Control (COPC, CMM etc certifications). Employees should look at learning more and should move to different verticals and horizontals as per their expertise, experience, likings and opportunities. It always helps in a longer run and increases employability in the market.

3. The employees should look at certifications like ITIL, PMP, CCNA, MCSE, S & P specialist etc. Some companies give it in house like Infosys BPO and the rest can be done from outside. These not only increase the knowledge of the employee, but also make him/her more employable. Employees should come out of their comfort zone and follow Steve Jobs principle of ‘’stay hungry stay foolish’’.

4. The employees who are young, and who still do not have the responsibilities of their families, and due to financial constraints had joined the BPO and could not go for further education should even look at the option of full time MBA from good institutes. A few employees whom we had interviewed had quit their ITES jobs for full time MBA/ PGDBA and now are better placed in the ITES industry. Hence along with exec MBA, employees should look at that option. A few employees had gone to the UK/ Australia to do their MBA. A few even had gone to do their MS from the US and had moved to IT and other industries.

5. Employees who joined the different verticals of the ITES industry should look for opportunity to move within the same company to a process where their skill sets match. For e.g. M. SC (Bio-tech/ Bio-medical/ bio-chemistry), B.Tech (Biotech) etc. should move to healthcare vertical of the BPO industry. MBAs should move to business analytics, Pre-sales, Project Management. Lawyers should move to LPOs. Many a times when they join, they are not aware of all these options, however within the company it is lot easier to move than to join as a fresher in that department as recruitments happen as per requirements and it is a possibility that when one has applied as a fresher, there were no vacancies in that process/ vertical.

6. Employees should not look at ITES as a stop gap arrangement and a stepping stone to a better career. ITES is an ever growing pie and in the last 15 years it has grown into many geographies

and the complexity of work has increased year on year. Today we do not do a lift and drop job in the ITES, we give solutions to the clients and help them do better business and have become a profit gainer for them.

7. Women should not leave their jobs completely during child birth. They should look at taking a sabbatical for 1-2 years and join back once the child grows up a bit. They should involve the family support in child care. Some BPOs are opening crèches to take care of this problem which is a positive trend. There are a miniscule percentage of women in the upper echelon. Hence women should grab management positions and should not only stick to workforce. That will help in their personal growth, give them financial stability and dual income families are always more stable than single income ones.

8. Employees should look at buying a separate life insurance the moment they start earning. They can look at tern insurance where the premiums are low, but the returns are very high in case of the unfortunate death of the employee. This gives a huge security to the family, especially if s/he is the only bread earner.

9. Employees should look at health insurance for sure. Many employees shared their unfortunate experience of losing their savings or selling their assets during any major illness of self/ family. Many employees had not added their parents in the health insurance policy and had to pay huge sums during hospitalization. Employees should not depend only on the health insurance through office, but should take separate health insurance for the entire family. During emergencies/ job changes etc. both come handy. And since the premiums are low at young age, employees should look at that option. It saves tax under 80C/CC/CCC.

10. All the employees should save from their first paycheck. They may look at the option of RD or PPF and make small investments there. By the power of compounding, it will grow over the years.

11. Employees should never withdraw the PF amount when they change companies. PF is a forced investment which the Govt. makes an employee to do and every employee should safeguard it. And they should not even look at the option of taking a loan against PF unless there is any emergency.

12. Employees should get into the habit of making small FDs every year and as the income increases should increase the FD amount too. Again FDs give tax benefits. Hence that is a good option.

13. Every employee should submit the medical bills (up to Rs. 15000 is tax exempted) and LTA bills as they are exempted from tax. We observed that most of the young employees are not aware of it and are not depositing it and paying tax unnecessarily.

14. Employees should submit the rent receipt and rent agreement to claim the tax submission on a year on year basis. We found that most of the employees whom we interviewed were doing it.

15. After the first 2-3 years of the job, and after having some savings and investments as FDs and PPF (Which cannot be withdrawn before 15 years), Insurance (Do not break the insurance midway- it does not give good returns and the whole idea of insurance fails if done), the employees can look at other investment options like Govt. Bonds, Bullions, MFs.

16. Employees should look at investing in property at a young age. It is ok if they do not buy a very good flat/ house. It is ok to buy a plot/ house in an upcoming area at a cheaper rate and avail the tax benefit as the property costs go up with time. Also if we do the calculations, we will see that rent+ some more money= EMI. Even if we do not stay in that house, we can put it on rent and

have a second income.

17. Employees, who buy a home, should buy an insurance to protect the home loan. It should cover any natural calamity and damage to the property, job loss, disability etc. so that your loved ones should inherit your property, not your loan in case of death or diability.

18. Employees should do thorough research before buying a property, MFs or exposing themselves to the Equity market. The risks are high and the returns too are high. However incorrect moves can incur a lot of losses. Also when an employee is young (below 35) s/he can do aggressive investment as s/he can make up for the losses. Most of the employees in their 30s mentioned that as of now they are at ‘’Medium Risk Medium Return stage’’, however after a few years they will take lesser risks as they will be nearing retirement.

19. In the 20s, all the employees should concentrate on their careers fully as they can reap the benefits when they grow older. There is no harm in ‘’work hard party harder principle’’ as long as they know their limits. Also they should not get into the debt trap as many of the ITES employees we interviewed had got into. The credit cards are easily given to this young group as the salaries are high and in big cities the avenues of spending money are high. And the culture in the ITES industry is quite westernized, and the young employees easily fall for the partying, movies, shopping mode using credit cards and personal loans. They should avoid taking car/bike loans as all the ITES companies provide transport and vehicle is a depreciating asset. Also the habit of balance transfer in credit cards should be avoided and if one needs to use the CC, then should pay off the entire balance every month. There should be no evolving credit. Using the credit card judiciously and using the 45 day credit period is good. But not otherwise.

20. Families during festivals should buy gold and silver. Gold has given more than 150% return in the last 4 years. Silver too has given more than 160% returns. In fact diamonds and platinum does not have much of resale value. Hence employees should buy it for personal use, and not think that it is an investment. Also ornaments are not exactly an investment as while selling, due to wastage, making charge etc. a lot of money is wasted. Employees should look at bullions or ETFs.

21. Employees should remember than every rupee saved in every rupee earned. Hence should minimize wastage. Every employee should make a budget and document the expenses on a regular basis. They should look at reducing wastages and stick to a budget. We observed that the employees who had saved prudently had managed to save, invest and enjoy all at the same time as the stuck to their budgets.

22. We observed that the employees who did not save in their 20s had to face problems and hence had to save and invest aggressively in their 30s. They had to curb their desires a lot in their 30s as they had to make up for the losses in their 20s. Hence we suggest the employees to save from their first pay check.

23. Every employee should look at a second income source. There are many part-time jobs which they can do over the weekends (Freelance training, web designing, modeling, music or any other vocational training, tuitions etc.). There are a lot of works from home options which employees can do if they have a PC and internet connection at home / cyber café. Every employee should look at such options.

24. Women employees when they take breaks from career during child birth or to take care of old parents or in-laws should look at the option of work from home. They will be in touch with the industry and leverage their knowledge, as well as earn money too. We interviewed a few single mothers who were using this option.

25. We suggest the employees not to spend more than 50% of their salaries in their maintenance and save and invest the rest. In the initial years of the career it is a little difficult specially if one has to pay rent etc., however if one manages by staying in shared accommodation etc. at a young age, then the later years become easy for them. And the ones who live lavishly in their 20s on credit face challenges later. Hence we suggest every employee to think before spending and not spend and then think.

26. Employees who are young should plan before getting married. Because we observed that employees with single income families were struggling in Bangalore with the expenses. The wives can take up some teaching jobs or any other less hectic jobs and contribute to the families. In Bangalore there are ample job opportunities in every field. They can also look at work from home options and contribute to the family income as much as possible. They should also look at curbing their expenses if the income of the husband is less. They should never spend on CCs after marriage just to enjoy life. We observed many respondents doing that mistake.

27. Employees should plan properly before having children. They should have a good corpus, and preferably should buy a house before planning for children. They should stick to one-two children as per their ability as the education and child maintenance is going very high day by day. Also after the child is born they should take a health insurance, education insurance for the child and secure his/her future completely.

28. Employees who are young should save for their weddings and should not put the burden on their families. Also employees in the late 30s and 40s should keep aside some money for their children’s weddings if they have children.

29. Every employee should have at least 6 months maintenance expense in their bank accounts. This is for any contingency like sudden illness, job loss etc. Employees who have regular EMIs should always keep aside 6 months EMI to mitigate any contingency.

30. Every employee should look at tax saving options and invest enough to save tax. Every year minimum 1 lakh should be saved for those employees who fall under the tax bracket. And the young employees who have just joined and their salaries are not taxable should also save prudently.

31. Employees should look at tax saving options like NSC, NSS, Child education, investment under pension scheme, infrastructure bonds. Every employee should check with the finance team of the company and make investments accordingly.

32. After doing a little bit of market research, we found that Mannapuram, ITIL, HDFC, Muthoot Finance etc. give personal loan against gold deposits. The ROI they were charging was between 12-14%. Hence if we need money for any occasion, the employees instead of taking personal loan where the banks charge 16 – 18 % ROI, it is better to go for the first optio.

33. When we checked the tax savings options of our company portal- we found that if we have parents who are disabled/ permanently immobile, then the money spent on their medical expenses are not taxable. The employees who have such situations should avail it.

34. One of the golden rules of investment is ‘’As and when our salary increases, we should increase our investments’’. All the ITES employees should follow that.

35. Another golden rule is , ‘’Never keep all your eggs in one basket’’. Employees should follow that principle and invest in debt and equity. Also they should invest in high risk instruments like property, bullion, equity and MFs and should have safe options like PPF, FD, NSC, Govt Bonds

etc. More the portfolio is diversified; the better it is for any employee.

36. Also the employees should never keep all their money in one bank account. They should have a mix of nationalized banks and private banks and should only invest with banks which have a good reputation. Not with private co-operative banks as the money might be lost if the banks goes in losses.

37. Also while taking insurance, employees should have a mix of Govt. agencies like LIC, and private players like ICICI Prudential, Bajaj Allianz, Bharti AXA, HDFC Life etc.

38. The moment your salary a/c is opened in one bank, you should open another account in another bank preferably nationalized bank, and start transferring money to that account every month. They should forget about that money and should invest in FDs within a short span of time. Now days we have short FDs for 15-45 days. So the liquidity is very high and the money earns good returns. Many of the respondents have opened accounts in Kotak Bank and Yes Bank and are earning good investments. However we do not advise to keep all the money in one bank and again we should scatter and look at tax saving 5 year FDs too which yield lesser returns, but the money is secured for 5 years and is saving tax too.

39. Many ITES employees do the mistake of not including the names of their parents/spouses as nominees for their life insurance. In the situation of an unfortunate death, the company has to go through the hassles of allocating the money to the next of kin. Every employee should do that mandatorily when they join the company and should contact the HR team if there are any changes in the details.

40. Also for their insurance policies, bank accounts, bank lockers and all other financial matters, every employee should either have a joint account holder or a nominee as the situation demands. We interviewed a few ITES employees and found that they faced a lot of issues in an unfortunate situation of the death of their parents. The employees whose families live in other cities face more problems in such situations. We had spoken to one employee whose father has a house in Kolkata. He is the only son who works with HP- Bangalore. His father died in Sep 2010, and till date he has not been able to do a name transfer of the property and put the property on rent as he is unable to take too many leaves and go to Kolkata for all these paper work. We interviewed another employee whose mother did not declare any nominee for her locker and died suddenly in Nov 2008 in Kolkata. Her father who lives in West Bengal since then is trying to take the possession of the locker, however has not been successful. The employee works with Infosys Bangalore and cannot visit Kolkata too often.