Thursday, January 27, 2011

Consolidation is the buzz in BPO sector

Indian BPO sector is swirling in consolidation waves as a result of fast changing industry dynamics. According to research analysts, consolidation will likely hit the business process outsourcing sector in the coming months. Some of the companies are already planning to move to different business lines since they face some bottlenecks to cope with changing dynamics. The $12 billion Indian BPO industry has been facing stiff competition from countries like Philippines, say analysts.

Recently, many of the domestic BPO companies have been broadening their service portfolios as part of their competitive strategies. Report suggests that BPO providers are aiming to differentiate services via broadening their service portfolios to provide end to end services. Also they are utilizing investments in technology for point solutions automation and business process utility services.

The process management sector is expected to see high growth as it offer good business opportunities along with cross selling scopes for domestic BPO entities. Moreover the sector is expected to be worth over a billion dollar in the coming years. According to analysts, the process management segment is expected to be worth about $1.7 billion by 2014. However, challenges like rising wages and increasing IT costs have been choking the BPO sector lately.

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