Paper Presentation

On
“Emerging Issues & Challenges in
HR Practices”

Sub Theme:
Hr and Service Sector:
“BPO Scenario: Hr Issues and Challenges”

Submitted to:
St. Aloysius College
Mangalore

Submitted by:
Sonali Pai
BBA 5th Semester
K.L.E Society’s
College of Business Administration,
 Emerging Issues and Challenges in HR Practices

Lingaraj College, (CBALC), Belgaum

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 Emerging Issues and Challenges in HR Practices

Business Process Outsourcing

Business Process Outsourcing (BPO) is the process of leveraging technology vendors in
various third worlds or developing nations for doing a job which was once the
responsibility of the enterprise. It can also be defined as the process of shifting an internal
job process to an outside/external company which might have a completely different
geographical location.

Challenges in BPO
• Attrition
• Brand equity: People still consider BPO to be "low brow", thus making it difficult to
attract the best talent.
• Standard pre-job training: Again, due to the wide variety of the jobs, lack of general
clarity on skill sets, etc, there is no standard curriculum, which could be designed and
followed.
• Benchmarks: There are hardly any benchmarks for compensation and benefits,
performance or HR policies. Everyone is charting their own course.
• Customer-companies tend to demand better results from outsourcing partners than
what they could actually expect from their own departments. "When the job is being
done 10,000 miles away, demands on parameters such as quality, turn around
timeliness, information security, business continuity and disaster recovery, etc, are far
higher than at home. So, how to be more efficient than the original.
• Lack of focused training and certifications.

Major HR challenge
Attrition of employees in this sector is difficult to handle and the way it is growing
everyday is havoc for industrialists and the question of survival of the industry is gaining
importance. As India is considered to be the top notch when it comes to BPO delivery
models, the only thing that is stopping India from going to the next level is the high
attrition rate. The attrition rate is hovering around 35-40%. An average Indian all centre
employee works with a company for 11 months where as an average UK call centre
employee stays in a company for three years.

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 Emerging Issues and Challenges in HR Practices

Drivers of high attrition

The challenge while addressing and understanding attrition is that it involves people and
is tenuous and ridden with nuances. Therefore, the reason behind the high turnover rate
cannot be attributed to a single factor, but instead to a combination of workplace
environmental influences and choices that people make.

 Influence on Personal front

• Health strains
• High stress levels (Long working hours, Odd shifts)
• Personal problems (Higher education, No time for personal life)
• Carrier growth and nature of work (Slow growth prospects, Monotony of work,
Repetitive nature of work, Work not challenging)

 Workplace /Environmental Influences

• Compensation policies (Salary not adequate, Salary increments not commensurate to
performance)
• Interpersonal relationship (Uneasy relation with peers /managers, Not provided
periodic performance feed back, No transparency in work related information, No
cooperation among staff members and poaching by competitors)
• Limited or lackluster training
• Benefits and working condition (Long transit time, insufficient leave/holidays,
policies and procedures not conducive, Food facility not adequate, Equipments and
other sources not adequate)

Issues and Results

The main reason of attrition in BPO is that there is lack of comfort with continuous night
shifts. Perceptional problem that BPO has no job enrichment and people find that there is
routine nature of the job with no addition to intellectual or analytical capability. The main
reason for the attrition are health problems, physical strain, no time for personal life, long
working hours, odd shifts, long transit time, insufficient leaves slow growth etc, but at the

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 Emerging Issues and Challenges in HR Practices

same times, besides facing these problems, it seems that they are satisfied with the salary
structure and pick and drop facilities. The other problems are they get frustrated because
other sectors do not consider their work experience. The employees who work on night
shifts lack social interaction and in addition, there are many more reasons of attrition like
slow growth, no career advancement etc. Attrition affects the BPO in many ways like the
cost involved in hiring new employees the cost involved are recruitment cost, selection
cost, training cost, development cost, orientation cost etc.
For retaining employees, BPO have bounded the employees with contracts stating that
they cannot interchange companies and if they want to, they need to give a valid reason.
Get together parties and recreational activities are carried on a regular basis. Since the
employees are being hired for the long term, a better work place has been created. These
things create a productive and satisfying work place and help in reducing the employee
turnover. Opportunities have been created for the employees to learn and grow. BPO is
reimbursing to some extent the costs of the courses taken up by the employees, seminars,
professional meetings etc. Extra training is given which relate to the employees areas of
expertise at work or to an area that needs to be strengthened

Various steps taken by companies to curb the problem of attrition

• Providing excellent infrastructure facilities with ergonomic work stations, spacious
and air conditioned offices.
• Offering industry specific benefits like 24*7 cafeterias and home pick up and drop
facilities, in-house gymnasium, health care facilities, food vouchers, counseling
services apart from regular benefits like retrials and loan at low interest rates.
Arranging special weekend parties and offering like incentives like tickets to
exclusive music shows and dance parties
• Some players are also sponsoring the higher education of their employees.
• Employers are also providing flexible working hours. And job rotation is also
provided
• Bonuses and incentives are also paid after every quarter if the employee sustains in
the organization and is also awarded if his performance exceeds the target assigned to
him.

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 Emerging Issues and Challenges in HR Practices

Suggestions

Below are a few suggestions that will help the BPO industry resolve the issue of attrition.
 The Hr department should be more forthcoming in accepting the capabilities
exhibited by an individual and promote him to a higher level if he is skillful enough
to handle the responsibilities at that level instead of having long gestation period for
promotions. In other words, the organization should be more flexible in their
approach towards industrious employees.
 The industry per se should spread more awareness among youngsters who constitute a
big chunk of BPO sector. Seminars addressing the current trends of BPO should be
held and students should be invited to participate. The industry will get to benefit a lot
by interacting with their prospective employees and in turn the students will get much
needed exposure of the corporate.
 Exit interviews should be conducted to find the reasons for resignation and the
companies should work on it seriously to reduce turnover. Employee satisfaction
surveys should be conducted. Quality circles should be formed exclusively for
knowing the problems pertaining to employees.
 Fair and competitive salaries should be given in accordance with the salary in line
with the industry. Financial and non financial rewards should be bundled.
Combination of both of them has proved to yield better results
 Front-line supervisors, managers and administrators should be trained. A good
employee/manager relationship is critical to employee satisfaction and retention.
They should be trained to develop good supervisory and people-management skills.
 Formal job description for each title or position should be made. Employees should
know what is expected of them every day, what types of decisions they are allowed to
make on their own, and to whom they are supposed to report.
 Provide adequate advancement opportunities. Career ladder should be implemented
and employees should know what they must do to earn a promotion. Regular

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performance review should be conducted to identify employees' strengths and

weaknesses, and help them improve in areas that will lead to job advancement.
 Employee engagement should be carried out. The effectiveness of employee
engagement depends upon the degree to which the employees are a part of the
decision making process and his/her ideas are incorporated in the final plan. It
generates self responsibility. And self ownership.
 Reward employee family. There would be no better motivation to an employee other
than rewarding hi family equilaterally with him/her. Companies need to track
employees’ family and help the employee in satisfying his/her family needs.

 Making the organization transparent. Organization functioning, development and

performance should be freely available to the employees. Effective organizational
communication should be carried out.

 Employees should be empowered. Today’s worker is a skilled worker and needs to be

given appropriate opportunities to express his/her ideas and explore his/her potential
fully. Empowerment gives a feeling of job ownership and enables employee’s to take
decisions making him/her more committed and engaged in the job enhancing his/her
overall performance

 Organizations should find strategies to reduce job stress in the work place. The
managers should rationalize the work load after careful exercise on role analysis of
the employees. Besides extending supervisory care and creating social environment in
the organization, imparting training to learn stress realizing techniques to the
employees would improve commitment in the long run. Introduction of techniques of
yoga and meditation could also prove beneficial.

Conclusion

The present studies and surveys have shown that India is strategically placed in the
industry to exploit the untapped outsourcing market. The hurdle which is largely stopping
India from fulfilling this dream is the ever growing attrition rate. The solutions already

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implemented by the companies and certain suggested could help India to overcome this
obstacle and reach the pinnacle in the BPO industry

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