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KPO Industry to Provide 255,000 Jobs in India by 2011.
Evalueserve estimates the industry to grow to US $11.2 billion by 2011 and offer immense career opportunities Attrition and insufficient domain expertise may impede growth.
Gurgaon, 13 September 2007: A study conducted by the Research and Analytics Firm,
Evalueserve, indicates that the Knowledge Process Offshoring (KPO) industry in
India is likely to grow to US $11.2 billion in revenue by 2010–11 and is expected
to employ approximately 2,55,000 professionals by March 2011. Among low-cost destinations,
India will become the hub for providing Research and Analytics services.
Almost two-thirds of professionals working in the KPO industry worldwide will be based in India,
especially because this industry requires substantial domain expertise among professionals who are Doctors,
Engineers, MBAs, Graduates in Science and Technology, Certified Financial Analysts, Accountants, Statisticians,
Lawyers, Economists and Chartered Accountants.
KPO includes domains, such as Business Research, Intellectual Property & Legal Research, Investment Research,
Market Research and Data Mining. Currently, at least 12 firms provide KPO services and have KPO as part of their name.
Moreover, there are at least five annual conferences worldwide that are solely about KPO (and some even have “KPO” as part of their names).
About 120 captive units of large multinational companies are providing KPO services to their offices in North America and Europe;
and there are more than 280 “niche” companies in India providing third-party KPO services.
Furthermore, according to Evalueserve’s research, although this industry had only 9,000 billable professionals in India during 2000–01
(who generated total revenue of US $260 million during the period), this number had already grown to 75,400 by March 2007 (who generated US $3.05 billion in revenue).
This implies a cumulative annual growth of 51 percent with respect to revenue and 43 percent with respect to the number of billable professionals during the last 6 years.
The Evalueserve study also predicts the fastest growth (with respect to the number of professionals) in the Data Management,
Searching and Analytics sector, which is expected to generate revenues worth US $2,500 million and employ about 60,000 professionals in 2010–11.
This would be closely followed by the Contract Research, Biotech and Pharmaceutical Services sector, which is expected to generate US $2,500 million in revenue and employ 50,000 people by 2010–11.
Finally, although the KPO sector is one of the hottest sectors in India and has created substantial job opportunities for professionals,
it is also facing the challenge of high attrition rates. This can be attributed to excessive job-hopping by young professionals who want
to earn quick money within a short span of time. Unlike in BPOs, where skills are taught in a few days or weeks and the work is very process oriented,
repeatable, scalable and does not require the worker to be near the client, KPOs require professionals who have an in-depth knowledge, experience and
judgement skills in their domains. According to Evalueserve’s estimates, job-hopping not only leads to reduced productivity,
but also has an effect on the overall growth of a professional, leaving very little room for new learning and acquiring domain expertise;
this leads to lower compensation (for such professionals) in the long run. If attrition continues unabated, it will be the sole factor
responsible for a decline of US $9.9 billion (or even more) in the revenues of the Indian KPO sector by 2010–11.
Such a scenario would ensure that some other competing countries (e.g., China, the Philippines, Poland and Russia) get a larger share of the global KPO market.
According to Dr. Alok Aggarwal, Chairman and Co-founder of Evalueserve, “Professionals who joined us after graduating in various disciplines 3 years ago and
stared with an annual salary of 4 lac rupees have now grown up to manage significantly large teams of around 30 or more professionals and may be easily earning twice as much.
Furthermore, some of them have even visited clients in other countries while conducting projects, and there are several instances where some of them have even moved to our
research centres in China and Chile for one to three years. This speaks volumes with respect to the tremendous growth opportunities offered by the KPO industry but only as
long as professionals continue to grow with the same company rather than hopping from one job to another.“
About Evalueserve
Evalueserve provides custom research and analytics services to companies worldwide including Business Research, Market Research, Data & Financial Analytics, Investment Research, Intellectual Property Research, and access to a global network of domain experts through Evalueserve Circle of Experts. The firm was founded by IBM and McKinsey alumni, and has completed over 12,000 client engagements. The firm currently has over 2,100 professionals located in research centres in Chile, India, China and New York. Evalueserve’s “in-country” Client Executives are located in most major business and financial centres globally – from Silicon Valley to Sydney. For more details visit www.evalueserve.com .
Disclaimer
Although the information contained in this article has been obtained from sources believed to be reliable, the author and Evalueserve disclaim all warranties as to the accuracy, completeness or adequacy of such information. Evalueserve shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.
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