Background checks in BPO firms

February 27, 2007

Before you get absorbed into a BPO firm today you might already have had a detective check out your precedents. They have little choice.

With the Indian software and information technology enabled services (ITES) exports heading towards $60 billion by 2010, it is becoming necessary for BPO firms to secure sensitive data and conduct background checks of potential employees.

Almost all the top BPO firms today rely on the services of forensic and fraud experts to conduct investigations and background checks on potential recruits.

Experts say since the BPO industry is gradually attaining maturity due to growth of business and transition of critical processes that demand utmost security for client-sensitive data, it has become very important to appease the client and help the industry attain the desired output.

‘Security awareness was always there but now that the industry is maturing, one needs to be more cautious,’ Kiran Karnik, president, National Association of Software and Service Companies (Nasscom), told IANS.

The BPO industry in India has received tremendous interest in the past several years due to its strategic socio-economic impact.

‘There was a case where an employee was electronically transferring data out of the company. We had to check his e-mails and interrogate his colleagues and after many such investigative procedures we finally managed to crack the case,’ said Sumit Makhija, associate director, dispute analysis and investigation services, PriceWaterHouseCoopers (PwC).

India’s considerable rise in the BPO space has been due to its skilled and low-cost manpower coupled with its English-speaking ability.

Last year, Britain’s popular Channel 4 carried out a sting operation that showed Indian call-centre employees selling client-confidential data for cash. This created a tremendous furore among the industry, making Nasscom send out reassuring statements in the media.

In another case, in July 2005, a reporter of one of Britain’s leading dailies, ‘The Sun’, managed to secure sensitive information from an employee of EDS (formerly Mphasis), a Delhi-based BPO.

The IT industry, despite its exponential growth, is also witnessing increasing cases of data theft, money laundering and leakage of confidential information about customers among others. The IT industry is growing at a rate of 31 percent in exports and employs over 1.6 million people annually. But the firms are gradually realising the disastrous impact of data theft and taking the required steps by hiring experts.

‘The whole issue of data security has heightened now. Today more and more IT/BPO companies are assigning us to investigate matters concerning fraudulent activities,’ said Deepankar Sanwalka, executive director, KPMG India.

‘With processes such as equity research gradually coming into India, this will require a level of preparedness on the part of the BPOs,’ Milan Sheth, associate director (outsourcing advisory centre), Ernst and Young, told IANS.

The specialised investigative teams, which consist of former Central Bureau of Investigation (CBJ) and Intelligence Bureau (IB) officials, are equipped with the most sophisticated technology and assigned by companies for a specific period to solve cases.

They carry out background checks on new recruits to prevent those with fake educational certificates from getting in. In some cases, they have even found the institutions named on the certificates to be non-existent.

‘There have been cases where people have produced fake certificates or scanned copies of false mark-sheets, etc.,’ said Yash Maroli, vice-president recruitment, EXL Service, one of the leading Noida-based BPO firms.

In order to conduct a background check, these experts contact the universities or colleges to verify the credentials of the applicants and in some cases even do referral check of their schools.

However, these are all done with the consent of the candidate concerned.

‘The volume of hiring in this sector is higher than in any other industry. And I believe these procedures make recruitment more organised, considering the quantum of business that comes in,’ Maroli said.

‘This is all about being ahead of the curve,’ said Karnik of Nasscom.

According to industry experts, the companies are gradually waking up to the need of compliance and security.

And, with Prime Minister Manmohan Singh setting a target of reaching $80 billion in exports by 2010 during a recent Nasscom summit, the industry is all geared up to face the challenge.

Source : www.offshoringtimes.com

Tags: BPO Services | Freelance Projects | Multimedia Outsourcing | Bookkeeping Outsourcing | Business Consulting | CAD Outsourcing | Call Center Outsourcing | Data Entry Outsourcing | Internet Marketing Outsourcing | Software Development Outsourcing | Web Development Outsourcing | Translation Outsourcing | Handwriting Services | Legal Outsourcing | HR Outsourcing

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Report: Offshoring to Have No Sudden Bad Effects

While offshore outsourcing is expected to affect wages and employment in developing countries, it won’t have any sudden negative impact on developed countries’ economies, according to a report released Feb. 22 by the McKinsey Quarterly, the business journal of the global management-consulting firm McKinsey & Company.

The report “Sizing the Emerging Global Labor Market” attempts to find a middle ground between those who argue that nearly all service jobs will eventually move from developed countries to low-wage ones, and those who feel that rising wages in cities such as Bangladore and Prague indicate that supply of offshore talent is already running thin. It attributes these rifts to a confusion surrounding the relatively new global labor market.

In analyzing the potential availability of offshore talent in 28 low-wage nations as well as the likely demand for it in service jobs across eight of the develop world’s sectors–IT services, packaged software, retailing, financial services, health care, insurance and pharmaceuticals–the report found that these sectors provided about 23 percent of the nonagricultural jobs in developed country.

Demand for Offshore

The report estimates that 11 percent of these services jobs around the world could be carried out remotely. However, this number can be higher or lower depending on the sector.

The retailing sector, for example, with its large number of customer-facing jobs, only stands to be able to offshore 3 percent of its jobs by 2008, but being such a huge employer, this would be equivalent to 4.9 million positions. The packaged software industry, however, stands to remotely undertake almost half of its jobs in the same time frame, but being a smaller industry, this would be only 340,000 positions.

The engineering occupation was deemed the most amenable to remote employment (52 percent), followed by finance and accounting (31 percent). Generalist and support staff work were determined the least amenable (9 percent and 3 percent, respectively). Yet again, however, though a small percentage, the vast number of workers in this category across each industry brings the number of jobs to 26 million.

In practice, the report expects that just a small fraction of the jobs that can be offshored will be. While 565,000 service jobs in the eight sectors have been offshored to low-wage countries today, the number is expected to grow to 1.2 million by 2008.

Total offshore employment was at 1.5 million jobs in 2003 but is expected to grow to only 4.1 million in 2008, or just 1 percent of the total number of service jobs in developed countries.

Offshore Talent Supply

The report argues the developing countries produce far fewer graduates suitable for employment by multinational countries than the raw numbers suggest, though it is quickly growing. The report found 33 million experienced young professionals in developing countries, versus 15 million in developed nations, and 7.7 million in the United States alone. Language gaps, an emphasis on theory versus practical knowledge and a lack of cultural fit are considered hindrances to actually employing much of this offshore talent.

Market Limitations

Though the report finds that the potential supply of offshore talent suitable for employment exceeds the demand in the eight categories they analyzed, this view wrongly “creates an illusion of abundance,” since companies tend to hire offshore talent in locations where others have had success.

This can often create local supply and demand imbalances, wage inflation and raise levels of attrition among workers. The Czech Republic, India and Russia are given as examples, with bigger squeezes expected from Prague and Hyderabad by 2008.

Implications for Countries

The report advises companies that rather than being sidetracked by the absolute number of graduates in a given country to instead consider the supply of suitable labor and the demand for it.

On the flipside, it advises supply-side countries to improve the quality of their talent, and not just its quantity, and for their governments to reduce the number of bureaucratic hassles involved in created these relationships.

Source : www.offshoringtimes.com

Tags: BPO Services | Freelance Projects | Multimedia Outsourcing | Bookkeeping Outsourcing | Business Consulting | CAD Outsourcing | Call Center Outsourcing | Data Entry Outsourcing | Internet Marketing Outsourcing | Software Development Outsourcing | Web Development Outsourcing | Translation Outsourcing | Handwriting Services | Legal Outsourcing | HR Outsourcing
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