India was the birthplace of the modern offshore IT and Business Process Outsourcing (BPO) industry. Although outsourcing, of a sort, had always taken place — from the purchase of components to the use of consultants — it was not until the 1980s that the use of call centers in India showed how large-scale offshore outsourcing could work. “The development of the industry was not entirely smooth. Some early operations were not renowned for their quality, and to this day, many, both businesses and consumers, assume that offshore call centers are inevitably low-quality,” says Ralf Ellspermann, CEO of PITON-Global , an award-winning call center outsourcing provider. While this was down to a mix of technical and personnel difficulties, early operators did not have the same level of communications infrastructure. They often made mistakes when it came to staffing and technology. It provided a rapid learning experience. It was not long before those involved in the sector improved the quality. These quality improvements encouraged more businesses to take advantage of the lower costs that call centers in India could offer. India had the distinct advantage of being the first mover.
“India remains the world's largest IT and BPO destination. The advantage of being the first significant player in a sector is hard for rivals to overcome,” says Ellspermann. But India boasts other benefits too. A key one is the sheer size of the nation. With a population of over 1.4 billion, a vast workforce is available. Even though the nation's literacy rates are relatively low by western standards — only around three-quarters of the population are considered literate — it still leaves plenty of people capable of staffing call centres in India. And, with a seemingly ever-growing global services sector, there is sufficient demand to fuel continued growth. However, other nations are now starting to compete for that business.
The Philippines is likely the strongest competitor India faces. The nation's outsourcing industry started nearly twenty years after India was already fielding calls from around the world. However, it quickly caught up, and in relative terms, the two countries have call center outsourcing sectors that are similar in size. “The Philippines has a particular advantage when it comes to serving US clients, where its history has resulted in an exceptionally high level of English proficiency and a close cultural affinity to the West. Although it is some way from the overall size of India's BPO industry, it has become the world leader for offshore call center services, in large part because of the high-quality English providers can offer,” says Ellspermann. But such competition can still benefit India, with Indian BPOs opening their own call centers in the Philippines. Indeed, more than 100,000 Filipinos are now working for Indian BPOs. It seems innovative operators are finding there are still opportunities for call centers in India, even if those opportunities are placed in the Philippines!
