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Bangalore loses its charm as BPO destination
By siliconindia
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Wednesday, 09 July 2008, 01:32 IST
Bangalore: Bangalore, a home to many BPO companies, seems to be losing its attraction in luring new companies in the sector, reported Business Standard.
A source in a real estate consulting firm said "from January 2008,only a handful of BPO companies have set up shop in Bangalore, as against an average two or three companies beginning operations every month in 2007."
Experts point to the lack of infrastructure, high cost of operations in the city and economic crisis in foreign countries as the reasons for the decline of investment in BPO sector.
S Nagarajan, founder and chief people officer, 24/7 Customer, a Bangalore based BPO firm said "We don't hear of too many companies coming to Bangalore, whereas we have seen many BPO companies starting operations in cities like Chennai, Noida, Kolkata and Cochin. I feel Karnataka is losing its advantage as a BPO destination." The experts believe that the other states like Tamilnadu and Andhra Pradesh give priority to improve the infrastructure than Karnataka. "Tamilnadu has planned the city's infrastructure with the long term interest of the industry in mind, Karnataka is no more the industry friendly state it was in 2000," added Nagarajan.
Large BPO firms which already have 10,000 more staff in Bangalore are now looking elsewhere for expansion.
The rate of hiring in the BPO sector is also coming down. Madan Padaki, co-founder and Director, MeritTrac, a talent assessment firm said "Most of the hiring is for attrition backfill and project positions. Bulk hiring today is few and far between." The number of hiring by the growth of the company is low, he added.
