1. What does BPO stand for? What does it mean? BPO stands for Business Process Outsourcing.

Major corporations in the US and Europe are outsourcing their back office operations to India to save costs. E.g. employee payroll is maintained in India for their employees worldwide. Although these jobs usually are not directly IT-related, their data-based orientation often means that they require IT departmental support to be successfully outsourced. 2. What does ITES stand for? What does it mean? ITES stands for IT-enabled services. IT-enabled outsourcing can be defined as, o Those outsourcing services that use information technology in the processing and delivery of the service. o Services are typically delivered through a telecommunications or data network, or other electronic media 3. What is nearshoring? The practice of sending outsourced functions of any sort, whether IT-based or business process positions, to a nearby country rather than choosing markets such as India or Malaysia that are thousands of miles away. For e.g. US nearshores the work to Canada and Mexico. The physical proximity of these "nearshore" countries is a big threat to India. 4. What are the reasons for outsourcing? Reason Savings Cost reduction 43% Focus 35% Access to special enterprise 32% Resource related reasons{relieve resource constraints, reduce IT staff and augment IT staff} 51% 5. What exactly does the BPO market comprise of? There is a disagreement as to what exactly constitutes BPO. With the rapid expansion of the BPO industry and the extent of its reach, it is becoming increasingly difficult to define what a BPO exactly means. It encompasses a wide variety of activities such as human resource, accounting, financial research, marketing, sales, legal work, logistics and so on. Software services are also regarded as a part of the BPO market by many firms. 6. What is BPM? BPM stands for Business Process Management, basically this is about outsourcing the business processes. 7. Now what is BTO!! ? o BTO stands for Business Transformation Outsourcing. Accenture defines BTO as a strategic partnership between the customer and the outsourcer with the advantage of sophisticated financing mechanisms. It would involve the firm acquiring strategic stakes in the BPO operations that companies have outsourced. BTO involves sharing risks and gains with an outsource business partner, measuring the performance improvement in dramatic gains in the share price, market position and return on capital. A BTO provides a comprehensive set of services across the entire organisation resulting in a pre-decided output, whereas a BPO is just a contract for outsourcing services/ functions to be done in a specified way. BTOs are more profitable and higher up in the value chain.

BTO also stands for Business Technology Transformation. It is a fast growing nice in BPO and is expected to become a $7 billion industry by 2007 from the current $2.5 million [2004]. BTO can reduce the overhead cost of enterprises by 20%. BTO is about governing the priorities, people and processes of organizations. It aligns IT and business strategy of a company while optimising quality, performance and business availability. According to Yankee Group, BTO enables companies measure and maximise business value across its IT investments.

o 8. What is BPO2? BPO2 stands for Business Process Optimization and Outsourcing. 9. What is KPO? KPO stands for Knowledge Process Outsourcing. KPO involves offshoring of knowledge intensive business processes that require specialised domain expertise, thus delivering high value to organisations by providing business expertise rather than just process expertise. 10. What is MBPO? MBPO stands for Medical Business Process Outsourcing. Apollo Hospitals is the first major hospital to be getting into this. 11. Can medical transcriptions be considered as BPO? Yes. 12. What is HRO? HRO stands for Human Resource Outsourcing. HR is getting outsourced to third party providers who can bring in the benefits of knowing the domain. HR as an activity, it comprises of a group of activities, which include payroll management, training, staffing, benefits administration, travel and expenses management, retirement and benefits planning, risk management, compensation consulting, etc. These activities are outsourced by which the client can concentrate on their core competency. In the US context, HR outsourcing is a huge area. For instance, nearly about 29-30 per cent of the outsourcing space is HR. 13. What is RPO? RPO stands for Research Process Outsourcing. This is popular in the biotech industry. Clients outsource their R&D work. This was termed reportedly by India's biotech queen Kiran Mazumdar-Shaw. RPO also stands for Recruitment Process Outsourcing. RPO is a key component of Human Resource Outsourcing (HRO). The RPO team basically handles all the recruitment work for their clients. 14. What is EPO? EPO stands for Engineering Process Outsourcing. India's engineering process outsourcing (EPO) business would grow 10-fold by 2014 to touch USD 30 billion and make the country a major hub in this area. The global EPO market, on the other hand, will grow to around USD 110-USD 140 billion by 2015, taking India's share to 20-27 percent, said the study conducted by the state-run Engineering Export Promotion Council.

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What is ESO? ESO stands for Engineering Services Outsourcing. Engineering Services Outsourcing (ESO) includes product design, research and development and other technical services across sectors like automotive, aerospace, hi-tech/telecom, utilities and construction/industrial machinery. Spending on engineering services was $750 billion in 2004 and is projected to grow to $1.1 trillion globally by 2020, according to a recent Nasscom and Booz Allen Hamilton study - Globalisation Of Engineering Services - the next frontier for India. ESO also stands for Educational Services Outsourcing. Education is a growing sector and the demand for Indian educators is on the rise. ESO market is estimated to be USD eight billion dollars and Indian teachers are currently offering services to countries like US, UK , Canada , and the Middle East. Though the main demand is from USA, newer markets of Netherlands and Europe too are fast opening up for Indian teachers.

16. What is defect density? It is defined as the number of errors per 1000 lines of code. Accroding to Meta Group it has grown from 0.53 (2002) to 0.6 (2003) and is expected to further rise to 0.87 (2005). 17. What are the 4Es? Engagement, education, enactment and enforcement framework is expected to ease the concerns of security and data privacy issue. 18. What is Procurement BPO? Procurement BPO is transfer of management and execution of one of more procurement activities, transfer of the entire procurement sub-segments or transfer of the entire procurement business functions to an external provider. It offers increased productivity, cost reduction and business transformation to the client. It has a market potential of $10 billion by 2006. 19. What does BOT mean? BOT stands for build, operate and transfer. BOT is not applicable only to BPO. Generally clients who wish to have their captive centre partner with a local company which builds and operates the centre for 2-3 years and then transfers it completely to the client. 20. What is HIPAA? HIPAA stands for Health Insurance Portability and Accountability Act. The US healthcare industry has been interested in simplifying administrative processes and improving efficiency for several decades. The industry leaders concluded that greater standardization of data and transactions was necessary to improve efficiencies. This conclusion was subsequently memorialized by specific administrative simplification language included in the healthcare legislation called the HIPAA. See the official site for more details. 21. What is DNC [Do Not Call] list? US Federal Trade Commission (FTC) Telemarketing Sales Rule bars companies from calling individuals who have registered themselves on DNC list. This hurts call centres that make outbound calls [cold calling]. This rule comes into effect from October 1, 2003. As of Sept 1, 2003 about 48 million individuals have registered on the DNC registry. If a company calls an individual on the DNC list, the fine can be

approximately $11,000. Call centres have bought insurance to protect themselves from being fined. 22. What is Call Blasting? Call center's sell by first playing a recorded message in American English. Then the real CSR speaks in neutral/American accent. 23. What does BFSI stand for? Banking, Financial Services and Insurance. 24. Is there any restriction about women working in call centers at night? In Karnataka, the Legislative Assembly passed a bill in August 2002 which provides for the use of services of women employees during night. Section 25 of the Act was modified to accommodate this change. It is likely that all other states have a similar law. 25. What is BOSS? BOSS stands for Burn-Out Stress Syndrome. BOSS syndrome is seen very commonly among young people working in call centres. The symptoms of this syndrome include chronic fatigue, insomnia and complete alteration of 24-hour biological rhythm of the body. Gastrointestinal problems are inevitable for those working at nights as the body is put under chronic stress. A potentially fatal increase in heart rhythm can result in severe chronic gynaecological problems in women and sleep disorders in both men and women. Guidance about physical and mental coordination to meet the demands of a call centre job is necessary. 26. Is it true that one needs very low skilled labor for a BPO operation? Not true. It really depends upon what is the kind of job you are doing for your client. There are companies in India who are doing the R&D work for their clients. Is that low skilled labor? 27. What does captive operation mean? The multinational company sets up its own BPO operation instead of outsourcing to a third party. E.g. GE Capital has its operations in Hyderabad and Gurgaon, Dell has an operation in Bangalore. 28. What is OTTS? OTTS stands for Outsourcing Through Six Sigma 29. What does "follow the sun" model mean? India is situated 5 hours ahead of UK, 10 hours ahead of New York and 13 hours ahead of Los Angeles. US and UK companies can claim overnight response capability because during their night time, it is day time in India and agents in India can respond to emails during Indian business hours. This is known as follow the sun model. 30. Are there any setup guidelines from the govt of India? See guidelines. This is basically to get the DoT [Department of Telecom] clearance to operate a call centre. There is no prescribed application form, but you need to submit a set of documents. From what we have heard this office is very helpful and they don't harass you.

31. Can ITES companies share bandwidth? As of Oct 22, 2002 the Govt of India has decided that ITES can use the bandwidth on a time-sharing mode. It would not be treated as resale of bandwidth, which was banned in India. The move will allow firms to use the same facility and bandwidth to service Indian and international clients, which is not permitted under the present norms. BPOIndia.org would like to thank Confederation of Indian Industry (CII), which mooted the idea. 32. Why is it important to have the call centre in multi-locations? o BPO clients would not like their work to be disrupted. To ensure continuity it is essential to be multi-locational, at times this could mean in different countries also. o BPO companies need to constantly evaluate where they can get the best value for their money. Low-skill jobs like data entry could be outsourced to countries where labor is cheaper than in India. o Few countries have data access legislation that prevents databases and information from crossing geographical boundaries. The best way to solve this problem is to have a BPO centre in that country itself. At times BPO client can take permission from the appropriate authorities and move the database outside the country. For e.g. in the case of EDS [Enhanced Directory Service] the operator needs to access a database which has the information of the residents/businesses of the client country. Usually you are not allowed to ship this database outside that country, however clients have taken special permission to ship this database to countries like Philippines. o 33. What is IVR? IVR stands for Integrated Voice Response. IVR systems are automated systems installed in customer contact/service centers that help automate routine tasks such as account information, product information, schedule etc. IVR systems help automate many transactions that free employees tedious repetitive tasks. Customers can input their query using touch tone phones and these days advanced IVRs support speech recognition. 34. What is the bandwidth advantage talk about at Kochi (Kerala)? Kochi has some of the cheapest available bandwidth in the country. It has the advantage of being located at the landing points of both satellite and submarine cable links. Both Sea-Me-We 3 and SAFE international submarine cables land at Kochi. Not only is bandwidth abundant, it is cheaper than at other locations. VSNL offers a 2 Mbps Internet leased line for Rs 12.5 lakh at Kochi. A 2 Mbps IPLC link costs Rs 40 lakh here. Nasscom has rated Kochi as one of the top two destinations in India for bandwidth intensive IT-enabled services. VSNL's International Gateway Exchange with 15 Gbps capacity is located next to the Cochin Special Economic Zone. Recently VSNL unveiled the SAT-3/WASC/SAFE submarine cable station in Kochi. With this, Kochi is one of the 16 landing points across the world for the submarine cable. The cable system has an ultimate capacity of 120 Gbps that enables it to convey a total of 5.8 million simultaneous telephone channels. VSNL operates a facility in the zone under the co-location scheme, offering global connectivity support to zone units at low-entry costs. (Source: Express Computer) 35. What is the talk about BPO companies being taxed? The Indian government wants to examine whether a non-resident company, which has outsourcing deals with a BPO outfit in India, is subject to tax in India. Tax implications for the BPO sector (source Express Computer)

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Taxing BPO clients will increase the cost of transacting in India. This will make India less cost-effective. Companies will be discouraged from outsourcing their processes to India, this will slow down the growth rate of the Indian BPO sector. Indian BPO sector will lose out vis--vis its competitors like Philippines, China, Ireland, Hong Kong, etc, if government adopts tough tax regimes. The employment generated by the BPO sector might take a beating and the country will lose out significantly on the income tax charged on individual employees. Overseas clients might perceive India as a country where taxation policies are not stable. India needs to project itself as a stable destination.

o 36. What is repetitive voice injury (call centre-itis)? Call centre workers are suffering from a new industrial disease: repetitive voice injury, also dubbed as call centre-itis. Long hours and little opportunity for even a drink of water are behind the 'disease'. 37. What is glocalization? Glocalization is basically globalization plus localization, your ability to take the best from the world's systems, best practices, best ideas, best brands, and meld them with your own culture in a balanced way so that you don't feel overwhelmed by them. 38. What are key performance measurements (KPIs) in a call center? A significant amount of information is required to effectively manage a call center. We need, for example, data on caller needs and expectations, the queue and caller tolerance, the load on the system, agent activities and performance, call patterns, cost components, the activities of other parts of the organization and conditions in the external environment. But we must also be able climb above the detail and assess overall performance, without the need to review dozens of reports. The question is, what measures can adequately summarize the numerous activities of a call center? While any measure by itself has the potential to mislead, the ten reports summarized below generally give a good synopsis of the call center's performance when they are interpreted together. A. Average Call Value (Sales and Reservations Only) This measure is generally calculated by dividing total revenue generated by number of calls. This has historically been, and continues to be, a top priority in sales and reservations environments. B. Customer Satisfaction Customer satisfaction is, without doubt, a top priority. Most call centers conduct surveys via either outbound calls or mail to randomly selected callers. Some call centers contract with outside firms to conduct surveys and prepare the results, while others do the surveys themselves. And a growing number of call centers are automating some surveys; callers are transferred into a VRU that guides them through a series of questions and allows them to respond via touch-tone.

C. Service Level Service level takes the form of X percent answer in Y seconds (such as 80 percent of calls answered in 20 seconds), and is a high level measure of how fast callers get through to reps. The best managed call centers take service level seriously, and strive to meet it as consistently as possible. An appropriately selected service level objective should mean that answering calls less quickly (or a lot more quickly) would actually cost money, not save it. D. Percent Abandoned Abandonment is an ongoing concern in incoming call centers. If callers hang up before we get a chance to talk to them, we are missing the opportunity to make them happy, sell to them and solve their customer service problems. However, abandonment is difficult to accurately forecast (and, therefore, staff around) and is often a misleading indication of the queue callers experienced. In the final analysis, we can control how accessible we are -- how many trunks we have, how many skilled reps are plugged in. But we can't control how callers will react or the myriad of circumstances that influence their behavior. Accordingly, be sure to view abandonment in light of the other measures, and in consideration of the callers' circumstances. E. Cost Per Call There are various ways to calculate cost per call (i.e. what factors to include in staff costs, how to allocate equipment, how to value the building) but the basic formula is to divide total costs by total calls received for a given period of time (usually a month). The potential in following cost per call is to identify the variables that are driving it upwards or downwards, and the impact they have. A climbing cost per call can be a good sign, depending on the variables driving it up. For example, process improvements may result in fewer calls than would otherwise be necessary (e.g. eliminating the need for customer callbacks, improving the VRU and coordinating with other departments to eliminate problems that generate calls). As a result, the fixed costs (in the numerator) get spread over fewer calls (in the denominator), driving cost per call up. But, of course, total costs will go down over time, because the elimination of waste and rework will drive down variable costs. (Similarly, cost per call usually goes down during the busy times of the year, and up during the slower times of year). F. Errors and Rework A major theme of the quality movement is that good service pays for itself because of the elimination of things that come with a lack of quality: doing work over, correcting mistakes, handling complaints, increased public relations costs, canceled orders or subscriptions, costs of closing accounts, costs of inspection, and others. Errors and rework are often part of a cycle. For example, errors and rework consume valuable staff time, which can lead to insufficient staffing to handle the incoming workload; insufficient staffing tends to lead to high occupancy, unhappy callers and increased stress on the

staff -- which contributes to errors and rework. So, reducing errors and rework has a positive impact on service level, morale, customer satisfaction and costs. A variation on errors and rework is a measure of the percent of calls completed on the first attempt, which has become an increasingly important measure in many call centers. Errors and rework can be measured in a number of ways. For example, the database may allow you to track repeat calls, unresolved issues and errors in data entry. Monitoring or side-by-side coaching should detect and track specific problems that are occurring during call handling. Call coding in the ACD (where reps use codes to track specific types of calls and issues) can trace problems. And transferred calls, escalated calls, customer complaints and correspondence (both to and from customers) can be additional sources of information. G. Forecast Call-load to Actual Underestimating calling demand will mask and defeat all other efforts to provide good service, and overestimating demand results in waste. Good forecasting comes from constantly tracking results and making improvements to the forecasting process. Common practice is to blend quantitative "time series" forecasting (projecting out existing call patterns) with judgmental forecasting (for example, what is marketing about to do? new terms and procedures? process changes? interest rates? the weather?). If the forecast is off by much, we need to identify which variables caused the problems, and factor them in (or out) in the future. H. Scheduled Staff to Actual This measure is independent of whether we actually have the staff necessary to acheive a targeted service level. How well do the staffs we have adhered to schedule? I. Adherence To Schedule Adherence factor is a measure of how much time an individual is on the phone, available to take calls, and generally consists of all plugged-in time, including talk time, wrap-up time, waiting to receive calls, and necessary outgoing calls. Generally, when adherence factor improves (goes up), service level goes up and occupancy goes down. Adherence factor is not just an issue of how much, but also an issue of when -- when during the course of the day, are reps is plugged in and available to take calls? J. Average Handling Time Average handling time brings together two components: talk time and after call work (wrap up). Talk time is everything between "hello" and "good-bye." After call work is that work that must immediately follow the inbound call. The ratio of talk time to after call work varies significantly from one call center to another. An erratic average handling time often points to the need for more training, especially on how to use the after call work mode. To be true after call work,

three criteria must be met- 1) The work is related to an inbound call, 2) It follows the call, 3) Immediately or shortly thereafter. In other words, the work is an important component of the randomly arriving call load. 2 What could be Service level objective being? The Quick Version of Choosing a Service Level Objective Sometimes we hear, "Okay, the analysis is fine, but let's get to the point. What should our service level objective be?" Fair enough. If you are in a competitive industry (e.g. shipping, catalog and mutual funds) and want to be on the high-end scale, 90/20 is fairly common. Others go for 85/15 or 90/15. Engineer for no more than one percent blockage on the trunks. If you hit these targets reasonably well, your abandonment rate will probably be around one or two percent. Going for the middle of the road? 80/20 is common. That's what a lot of banks, insurance companies and travel reservation centers shoot for. 80/30 and 90/60 are other popular mid-range service levels. Don't allow more than one to five percent blockage on the trunks. Hit these objectives and you'll probably see abandonment at three or four percent. Want a service level that is more modest? 80/60, or 90/120, or even 80/300, with five to 15 percent blockages, is a target common with software support centers and some government organizations. Abandonment can range up to 10 percent, 15 percent or higher. Hold your judgment - some of these organizations do a darn good job of hitting these objectives consistently, a lesson many with more lofty goals could use. Of course, just throwing out numbers like this can be dangerous. There are exceptions to the norm in any industry. Also, interpret these numbers with common sense. If you are an emergency services center, you will target 100/0. On the other end of the scale, there are centers for which 80/300 is a dream. Remember, it's not just how high your objectives are, but how consistently you hit them. What is PTP? PTP stands for Per-transaction price. A norm in the US and the concept is fast gaining popularity among top Indian BPOs, the chances of PTP becoming a norm in industry are very dim. PTP for the uninitiated is a form of pricing where a BPO company is paid only on the basis of completed transactions. The client pays a portion of the value that he gains from outsourcing rather than a fixed cost based on the number of seats or hours of effort that a service provider uses to deliver the solution. This ensures that the client pays only for the benefits that he derives and not for inefficiencies of the service provider. Transaction-based pricing requires high degree of domain specialisation especially for high end BPO work - a BPO credibility and proven track record that today is not widespread. What is TCV? TCV stands for total contract value.