Recent HR trends in BPO/ITESKPO

1. HR TRENDS IN BPO

2. HR trends in BPO Page 1

3. HR trends in BPO Page 2
What is Business Process Outsourcing?
Business process outsourcing (BPO) is a subset of outsourcing that involves the contracting of the
operations and responsibilities of a specific business process to a third-party service provider. BPO is
typically categorized into back office outsourcing, which includes internal business functions such
as human resources or finance and accounting, and front office outsourcing, which
includes customer-related services such as contact center services.
BPO that is contracted outside a company's country is called offshore outsourcing. BPO that is
contracted to a company's neighboring (or nearby) country is called near shore outsourcing.
Sub-segments of BPO:
 ITES-BPO (Information Technology Enabled Service)
 KPO (Knowledge process outsourcing)
 LPO (Legal process outsourcing)
Talent Acquisition
The HR Functions in a BPO starts with recruitment. There are two different kinds of hiring in this
vertical, which includes fresher and laterals. Any talent joining this sector for the first time are
usually treated as a fresher. Laterals are talents who have worked in other companies in similar
roles. It is done for the new positions and the back-fills. Here the volume hiring is done through
walk-in where a large number of talents attend the interview as announced in the newspaper.
Recruitment drives are arranged to hire in large numbers. This is promoted through print media and
recruitment consultants. There are off-location and outstation drives. Business requirement may
weave ‘Every Monday – Induction’. This implies that a batch of employees would be inducted every
Monday. Background verification and medical check-up is completed before the Induction begins.
Functions of HR in BPO sector
 Human resource planning.
 Recruitment & Selection.
 Training & Development.
 Motivation
 Employee engagement
 Grievance Handling.
 Employees Satisfaction.
 Performance appraisal system.
 Compensation management
 Organizational Development.
Talent Management
The Employee Life cycle management which includes all activities strategizes to optimize the
talent’s capability as part of the Talent Management. The Entry-to-Exit HR Processes, leadership
development, succession planning, Compensation and benefit would all be clubbed under this area.

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Managing the Employee Lifecycle
Entry to Exit:
If we take each of these activities in turn, we find that hiring is done in conjunction with the line
managers who put out their requirements periodically on the kind of recruits they want and the
number of recruits they want. Once the request reaches the HR manager, he or she has to scour the
market for potential recruits. Usually, the HR manager does not personally do this and outsources
this function to a placement consultancy. The next step is the interview stage after the shortlists are
done and this is an activity where the HR manager either delegates the task of assessing the
potential recruits to the staffing team or does the job personally.
After the interview stage is over, the important task of fixing the salary and benefits of the successful
candidates has to be done. This is usually the time when the HR manager plays a critical role as he or
she has to determine the fit between the role and the candidate and decide on the quantum of
salary and benefits that is appropriate to the role and after examining the budgets for the same.
The Appraisal Process and the Exit Interviews
After these activities, the HR manager is also involved in conducting the last stage of appraisals or
evaluating the appraisals. In recent years, the trend is more towards the latter where the HR
manager in charge of the business unit evaluates the appraisals instead of participating in the
process directly. This is done in a manner to determine the quantum of pay hike or bonuses keeping
in mind the same principles that were discussed in the hiring activity. What this means is that the HR
manager has to work closely with the line managers to get this done.
The last activity that the HR manager is involved in is conducting the exit interviews when employees
leave the organizations. This is usually done on the last day of the employee’s stay in the
organization and this process consist of a free and frank discussion on what the employee feels
about the organization and why he or she is leaving the organization. The exit interviews offer
valuable sources of insights into organizational behavior as the employees can vent their feelings on
what works and what does not work in organizations.
HR Process
 Human resource planning (Recruitment, Selecting, Hiring, Training, Induction, Orientation,
Evaluation, Promotion and Layoff).
 Employee remuneration and Benefits Administration
 Performance Management.
 Employee Relations
Recruitment
It is the process of locating, identifying, and attracting capable applicants. The development of a pool
of job candidates in accordance with a human resource plan.

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Steps in recruiting process:
 Internal search
 Advertisement of a job vacancy
 Web based advertising
 Preliminary contact with potential job candidates
 Initial screening to create a pool of qualified applicants
Methods
External Recruitment & Internal Recruitment
Selection
The process of assessing candidates and appointing a post holder to ensure that the most
appropriate candidates are hired.
Selection Criteria
 Completed job applications
 Interviews
 Background checks
 Physical examination
 Job offer
Orientation
Introduction of a new employee to his/her job and the organization. It is designed to provide new
employees with the information needed to function comfortably and effectively in the organization.
Three types of Orientations:
 General information about daily work routine
 Review of organizations history, purpose operations, and products of services and
contribution of employee’s job to the organization’s needs.
 Presentation of organization’s policies, work rules, and employee’s benefits.
Training
A process designed to maintain or improve current job performance. Most training is directed at
upgrading and improving an employee’s abilities or skills.

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Training methods
 Most training takes place on the job because this approach is simple and inexpensive
 Some skill training is too complex to learn on the job, in such cases it should take place
outside the work setting.
 Professionalism
 Corporate Etiquette
 Assertive Communication at work
 Business writing skills
 Telephone Management skills
 Personal Effectiveness
 Self-Management-Basic skills
 Personal Health
 Achievement Motivation
 Task execution excellence
 Team working
Professionalism: It includes understanding about the term, standards of a professional, Knowledge,
skills and attitude requirements and understanding about the role and responsibility of a
professional.
Corporate Etiquette: It includes learning about corporate dress sense, Core corporate attitude,
accountability, reactiveness, Expectation and perception management and inculcating discipline.
Assertive communication at work: It includes learning communication at the workplace, benefits of
assertiveness, verbal and nonverbal indicators and applications.
Business writing skills: It includes basic e-mail etiquette, appropriate use of active and passive
voice, about the email dominated business world, sentence combining and paragraphs and being
consistent in writing. Telephone etiquette: It includes basic telephone etiquette, answering incoming
calls, effective listening and speaking skills.
Personal Effectiveness: It includes learning about various leadership styles, health & stress,
emotions, people and dimensions of personal effectiveness.
Self-Management-Basic skills: It includes about aspects of emotional health (EQ), stress
management, motivation, mental agility, prioritization of tasks and task execution. Team working: It
includes managing internal customer relationships, rapport building, conversation building,
differences between a group and a team, team communication, conflict management skills, team
meeting etiquette. The program is a four day transition workshop which ends with a ‘Team player
style survey’ which identifies each trainee’s style as a team player. The trainee is also given a
“learning summary and action plan format” which is a means of feedback mechanism. It collects
information as to what the trainee learned during the program and how he proposes to implement it
at the workplace. All the employees have to complete all the mandatory courses within one month
from the date of joining. Some of the important elements are:

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 Ethical Leadership
 Total customer experience
 Environmental, Health, Safety and security
 Customer experience standards
 Standards of personal conduct
Business writing skills: It includes learning to write a standard business letter, to give a professional
tone to the letter, use of phrases, use of correct words and language. Customer Orientation: It
includes learning about customer expectations and experience. The critical deliverables are
responsiveness, Turnaround time and acknowledgement. The keys to achieving critical deliverables
are: v First impression v Empathy v Apology v Probe v Personalization
Communication skills: It includes learning about process of communication and comprehension,
types, mediums of communication and the impact of effective communication. E-mail Etiquette: It
includes learning about composition of an e-mail, writing a salutation, opening and closing of letters,
using of positive tone and positive phrasing.
Leadership & Managerial programs: It is developed through Centre’s of Excellence, in consultation
with expert trainers which drives home the point that an overall development of personality coupled
with technical skills is a winning combination for the employees.
Employee Performance Management
Performance management is a process used within organizations to establish and evaluate an
individual’s job performance to achieve goals and objectives. It is meant to help the organization
train, motivate and reward workers. It is also meant to ensure that the organizational goals are met
with efficiency. The process not only includes the employees but can also be for a department,
product, and service or customer process; all towards enhancing or adding value to them.
Performance Appraisal
A process of systematically evaluating performance and providing feedback upon which
performance adjustments can be made.
Performance appraisal should be based on job analysis, job description and job specifications.

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Compensation & Benefits
Employee benefits are optional, non-wage compensation provided to employees in addition to their
normal wages or salaries. These types of benefits may include group insurance (health, dental,
vision, life etc.), disability income protection, retirement benefits, day-care, tuition reimbursement,
sick leave, vacation (paid and non-paid), funding of education, as well as flexible and alternative
work arrangements.
 Benefits of a fair, effective and appropriate compensation system.
 Helps attracts and retain high performance employees
 Impacts on the strategies performance of the firm.
 The process involves deciding upon salaries and wages, Incentives, Fringe Benefits and
Perquisites etc. Money is the prime motivator in any job and therefore the importance of
this process. Performing employees seek raises, better salaries and bonuses.

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Examples of different type of remuneration and benefits,
 Basic Salary
 Bonus payments and pay for performance
 Allowances like representation allowance, child allowance, housing allowance, COLA (cost of
living adjustment) allowance, lunch allowance, …
 Different types of sales commission payments
 Company Car, Company Mobile Phone, Company Laptop
 Mobile phone credits
 Holiday pay and holiday credit administration
 Retirement and pre-retirement benefits
Payroll and MIS (Management Information System):
This is similar to the processes that are being run at any sector. The difference might lie in the way
incentives are drawn. Most of the BPO have different structures for monthly and quarterly payments
compared to other knowledge sectors where reimbursement would be higher and the incentives are
rolled at the end of the year with bonus and hikes. The MIS system is required to be robust as the
data provided would be upgraded at a very short interval.
Managing attrition:
The attrition remains the greatest concern. The employee turnover ratio remains highest in this
sector. The employee life-cycle runs shorter as the talent either fails to see a career path within the
company or fails to adjust with the organization culture. Often the job opportunities are marketed
so well that a new job is preferred over an existing job.

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A minor discrepancy in the behavior with the leaders or the change in alignment of the career path
drawn with respect to the individual’s ambition can prompt a talent to change their jobs. Creating
better career path within the company, offering a compensation package relevant to the job-
profiles, more importantly hiring talents who are better inclined to the job and aligned with the
organizational goals are the chief way to manage attrition. Identifying the early-warning signs and
keeping a realistic view to the employee life cycle would help HR to pre-wire attrition.
Employee Relations - HR
Employee relations may be defined as those policies and practices which are concerned with the
management and regulation of relationships between the organization, the individual staff member,
and groups of staff within the working environment.
Functions:
a. Independent counselling to resolve work related problems.
b. Coordinate services provided by the Employee Assistance Program
c. Facilitate regular employee feedback, organize meetings, counselling & ensure problem
resolution.
d. Facilitate rewards & recognition.
e. HR initiatives by working closely with Delivery Managers and Project Leads.
f. Managing the overall HR processes ensuring both internal customer and higher employee
satisfaction.
g. Active involvement in employee retention especially excellent performers.
h. Employee profile management.
i. Conduct training on a variety of Human Resources and Employment Topics
j. Administer Employee Recognition Programs and Service Award
Other HR Initiatives:
Mostly the HR Initiatives are centered on increasing employability and employee engagement. The
events are planned, they are tactic and strategic. A monthly event is planned with fun activities.
These initiatives are on the transactional level. Whereas preparing the employee for career
progression through cross vertical roles and horizontal shifts are on the transformation level. This
increases the employability and builds a longer career path within the company. Few initiatives
remain perpetual such as building trust through open communication including intranet,
monthly magazines, focus group meetings, brown-bags and town halls. The employees are
encouraged to use open-door policy to get their questions answered. It further offers
them visibility to the top management in the firm.
The difference between the HR in a BPO and in any other sector will remain in its alignment towards
the robust talent base and dynamic business models. Managing ramp-up and ramp-down at a
shorter notice with minimum deviations to the balance within the company, makes HR unique.