Rural BPO, Empowering the Villages

Business process outsourcing (BPO) is an industry that people relate with the operation of outsourcing business mostly based in tier-1 and -2 cities of the country. However this thought has been rendered as a mythical view in the recent times.

Rural BPO is not a new phenomenon anymore. From Bihar to Karnataka to Tamil Nadu, we are having enough examples of rural outsourcing initiatives run by different companies and authorities in India now. A growing number of outsourcing companies are shifting simple typing, data mining, or documentation kind of jobs from metros and tech hubs to poor rural areas. This move is creating many jobs at a fraction of the cost of running a business in a big city.

RuralShores, Tata Business Support Services, DesiCrew Solutions, Chida Soft, and Comat Technologies are already operating in different parts of the country to name a few. Some of the organizations that get services from such centers include HDFC Bank, Kotak Mahindra Bank, Axis Bank, and many telecom players.

Recent example of another honcho to enter this domain is Wipro BPO. They recently inaugurated their first rural BPO center at Manjakkudi Village in Tamil Nadu. The Manjakkudi center has a capacity of 120 seats and will open with a 50-seat pilot project for an international client in the retail sector.

Conceptualized on the ‘Back Office to the Back Office’ (BOBO) outsourcing model, the focus of the center is to capitalize on the literate talent pool available in the region and in doing so create employment opportunities in the village and its surrounding areas.

Manjakkudi was selected due to the relatively high levels of investment in education in the region. It benefits from more than 46 colleges within 40 km radius where more than 13,000 students graduate from these colleges annually, thus providing a large talent pool.

Wipro plans to expand its rural BPO operations to 500 seats by March 2013 in Tamil Nadu and to replicate this BPO model across other states in India, in the near future.

Rural BPOs have lower real estate and labor costs along with less attrition rate, resulting in costs savings of nearly 40% over their urban counterparts.

Realizing the employment opportunity that rural BPOs can offer, some state governments too have started providing incentives.

The initiative provided by the Karnataka government, for instance, has led to the setting up of 16 rural BPOs in the state.

The Tamil Nadu Government is in the process of devising a ‘restructured rural BPO policy’ to attract more entrepreneurs from urban areas to invest in rural areas. Under this scheme, around 2,500 students will be trained in 2011-12 at the cost of `5 crore.

This way people in remote villages get jobs and the promise of a better life, and companies can gain hugely in terms of cost advantage.

Posted on December 30, 2011, in Business, Technology and tagged , , , , , . Bookmark the permalink. Leave a comment.

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