Professional Documents
Culture Documents
“ENTERPRENEURSHIP
DEVELOPMENT
PROJECT”
Page 1
RURAL BPO- Beginning A New Era of Freedom
“RURAL BPO”
ACADEMIC SESSION
(2009-2011)
Page 2
RURAL BPO- Beginning A New Era of Freedom
DECLARATION
I hereby declare that the project work entitled “Rural BPO GAAMZAN- Beginning A
Team SKYE , MERCY CORPS and this project work has not performed the basis for the
award of any Degree or diploma/ associate ship/fellowship and similar project if any.
Page 3
RURAL BPO- Beginning A New Era of Freedom
CERTIFICATE
This is to certify that the Project Work titled “RURAL BPO - GAAMZAN” is a
bonafide work of SHABIR MUZAFAR BHAT Enroll No: 51 an intern at MERCY CORPS
carried out in partial fulfillment for the award of degree of Masters In Business
guidance. This project work is original and not submitted earlier for the award of any
Signature:
Team SKYE
Project Coordinator
Mercy Corps
Place : __________
Date : __________
Page 4
RURAL BPO- Beginning A New Era of Freedom
ACKNOWLEDGEMENT
“It is not possible to prepare a project report without the assistance & encouragement of other
On the very outset of this report, I would like to extend my sincere & heartfelt obligation
towards all the personages who have helped me in this endeavor. Without their active guidance,
help, cooperation & encouragement, I would not have made headway in the project. First and
foremost, I would like to express my sincere gratitude to my project guide/mentor, Team SKYE. I
was privileged to experience a sustained enthusiastic and involved interest from their side. This
fuelled my enthusiasm even further and encouraged me to boldly step into what was a totally dark
We also owe deep sense of gratitude to our HOD, Dr. Mir Parvez and our beloved School of
Business Studies, Islamic University of Science and Technology for molding us into real
management students.
Last but not least, I would like to thank Ms. Afshan Gazi (Research Associate) for helping
me in every sphere of research during the project. I extend my gratitude to MERCY CORPS & my
University- Islamic University of Science & Technology for giving me this opportunity.
Any omission in this brief acknowledgement does not mean lack of gratitude.
Thanking You
SKYE Team
Page 5
RURAL BPO- Beginning A New Era of Freedom
TABLE OF CONTENTS
PREFACE 8
EXECUTIVE SUMMARY 10
CHAPTER 1: INTRODUCTION
1.1 Business Process Outsourcing 12
1.2 Rural Telecenters 14
1.3 Khidmat Centers – Movement in J&K 15
1.4 Rural BPO: a viable option? 16
1.5 AEGIS- A Gaint Leap in Kashmir 17
1.6 Project Overview 18
Page 6
RURAL BPO- Beginning A New Era of Freedom
CONCLUSION
LIMITATIONS
BOOKS 54
WEBSITES 54
ANNEXURE
Page 7
RURAL BPO- Beginning A New Era of Freedom
PREFACE
Services globalization has turned the world into a global village, enabling the seamless delivery of
IT and Business Processes across time zone. As a result, India has become the most favored
destination for outsourcing operations and more so due to its skilled manpower, cost advantage and
appropriate infrastructure. These ITO/BPO centers are located mostly in urban India and they
epitomize the best of the four core evaluation criteria that companies look to optimize: cost, control,
quality and risk.
In rural India, the entrepreneurship scenario is slowly changing. With the penetration of networks of
Telecenters/Service Center Agency have started to pop up; some focusing on information sharing
among community, and others into learning, training, knowledge sharing and commercial services
for rural community.
Today, with urban BPO players looking for alternatives to cut their operations cost to sustain
operations in stiff competition, and on other side with the growing numbers of educated/computer
literates coming up in rural areas, it provides opportunities to leverage ITES for creating BPO jobs at
rural level; thus enhancing livelihood opportunities for community members and help reversing the
trend of migration to villages. Whether such BPO initiative is feasible in Kashmir?
It is in this light that, I, the student of Islamic University of Science & Technology (IUST) with
Mercy Corps has taken up the current research work for SKYE (Startup Kashmir Youth
Entrepreneurship) to study and explore the feasibility and challenges for rural BPO “GAAMZAN”
for undertaking outsourcing business. The objective of this study is to understand, analyze and scope
Page 8
RURAL BPO- Beginning A New Era of Freedom
the feasibility parameters for providing BPO Services in terms of social, economic and institutional
factors. Also the report explores the type of BPO activities suitable for rural BPO. This report, with
the feasibility parameters identified and scoped, and type of rural BPO activities that can be taken up
- will go a long way to serve as a guideline as-well-as in taking informed decisions by those
organizations/entrepreneurs, who wish to commence BPO initiatives in rural locations. The report
also suggests the future research work that can be taken up on rural BPO services.
We thank all the participants who took time from their schedules and shared their perspectives on the
industry as-well-as the respondents on their views and valuable inputs, and also the research team
who persistently worked to bring out this report. We are confident that this report will help growing
entrepreneurs, who are looking forward for such rural BPO initiatives to help enhance income
generation and livelihood opportunities for community members and village entrepreneurs as-well-
as impact the rural economy and hence well-being of the community.
Shabir Muzafar
MBA (SBS, IUST)
Page 9
RURAL BPO- Beginning A New Era of Freedom
EXECUTIVE SUMMARY
Kashmir, at urban level had remained untapped in BPO sector till 2008. It got its first urban
BPO Aegis, a part of Essar Group with most of its activities based on local & domestic clients . And
the rural Kashmir has not yet been tapped or involved in the outsourcing business, which can help
leverage the cost benefit due to the availability of low-cost talent pool (computer literates and
graduates) and cheap real estate/rentals in rural areas as compared to cities.
Page 10
RURAL BPO- Beginning A New Era of Freedom
I, the student of Islamic University of Science & Technology (IUST) with Mercy Corps has
taken up the current research work for SKYE (Startup Kashmir Youth Entrepreneurship) to study
and explore the feasibility and challenges for rural BPO “GAAMZAN” for undertaking outsourcing
business. The objective of this study is to understand, analyze and scope the feasibility parameters
for providing BPO Services in terms of social, economic and institutional factors. Also the report
explores the type of BPO activities suitable for rural BPO. As per the scope of the study and taking
into consideration capabilities in rural Kashmir, it needed a detailed study comprising of literature
review, comprehensive primary research/survey on urban BPO, rural Telecenters/ Khidmat Centers,
General Population, skill-set availability at village level, jobs suitable for rural BPOs, challenges and
opportunities for rural BPO, and on other relevant areas. As per the research methodology drawn, the
planned activities were carried out for the above to meet the research objectives defined. Based on
the above mentioned survey/research, the findings and learning helped to identify and scope the
feasibility parameters for providing BPO services in terms of social, economic and institutional
factors. The feasibility parameters identified for rural BPO were grouped under – rural dynamics,
rural talent pool, rural infrastructure, and government policies.
Shabir Muzafar
MBA III Semester
Page 11
RURAL BPO- Beginning A New Era of Freedom
CHAPTER -1 INTRODUCTION
Gartner defines BPO as “the delegation of one or more IT-intensive business processes to
external provider that, in turn, owns, administrates and manages the selected processes based
on defined and measurable performance metrics”.
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 nearshore outsourcing.
Outsourcing is now considered as a strategic tool that helps companies concentrate on their
core competence and delegate other peripheral activities to an external agency that specializes in that
task. Delegating responsibilities to people who are specialists or to the region which can do it at a
„comparative cost advantage‟ is the logic of outsourcing business.
Page 12
RURAL BPO- Beginning A New Era of Freedom
Benefits of BPO
Increase productivity
Cut operational costs
Provide better service
Save costs
Improved accountability
The BPO boom seems to be increasing everyday with more and more companies deciding to
follow the race, making conditions really viable for a positive growth in the BPO industry, by
moving to rural areas initiating the concept of Rural BPO, to cater the needs of rural people viz-a-viz
catering the needs of their clients domestic as well as overseas.
Metros in India, Delhi, Mumbai are basically regarded as TIER-I cities, whereas relatively
smaller ones are TIER-II cities like Gurgaon, Pune etc. and the smaller ones are considered to be
TIER-III cities. J&K, Srinagar can be considered as Tier III city.
Page 13
RURAL BPO- Beginning A New Era of Freedom
variety of services using the convergence of computing, telecom and media. Designing
telecenters/khidmat centers as delivery points using the concept of „shared services‟ brings down the
cost; khidmat centers become delivery points for multiple services at a location. At the most basic
level, telecenters/khidmat centers focus on improving the livelihood of individuals. Slowly, networks
of telecenters have started to crop up all over rural India. Some are focused on information sharing
among community, and others into learning, training, knowledge sharing and commercial services
for rural community. There are some who have bundled up community services – like telemedicine,
development.
Page 14
RURAL BPO- Beginning A New Era of Freedom
A Dream project launched in J&K State, few years back, J&K Bank has entered into a
„Service Center Agency‟ (SCA) tie-up with J&K government for setting up 1109 IT Kiosks in the
state. The Kiosks, set up on a Franchiser-Franchisee basis, acts as Common Service Centers (CSC)
for delivery of G2C (Government to Customer) and B2C (Business to Customer) services including
financial services in all the rural areas of the state. The centers are set here in J&K under name
“KHIDMAT CENTRE” and run by Village Level Entrepreneurs (VLEs) identified through a
comprehensive selection process made by J&K Bank.
Page 15
RURAL BPO- Beginning A New Era of Freedom
Rural BPO carry out BPO services at rural end to add value to the outsourcing business as
well as to the community. In order to beat the competition, industry majors are shifting their base to
tier II and tier III cities. These cities provide substantial gains on infrastructure, transport and real
estate availability. Similarly, on the parallel grounds organizations can extend operational flexibility
by relocating the BPO services to rural locations. The setting up of rural BPO in villages can result
in the development of rural infrastructure, employment and livelihood opportunities, increase in
standard of living and enhancement of rural economy at the village level. Transfer of BPO units to
rural areas make tremendous business sense and has significant social connotations involved with it.
Kashmir is struggling to have its own private sector developed. Seeing the sensitivity of the state the
rural BPO is a bold initiative to start from somewhere to reach somewhere. It will be of great interest
to eradicate unemployment and viz-a-viz create great opportunity for entrepreneurship.
Page 16
RURAL BPO- Beginning A New Era of Freedom
Aegis, a business process outsourcing (BPO) company under the Essar Group umbrella,
commenced its operations in Kashmir recently. Post-militancy, this is the first time that a venture of
such magnitude has been undertaken in the Valley.
Set up at the Rangrate IT Park near Srinagar, the BPO centre boasts of the latest technology
and offers world-class facilities in line with other Aegis centres across the globe, company president
Sudhir Agarwal said.
He said that the company has recruited 200 employees from the Valley to fulfill its
commitment of providing employment to the local youth.
Agarwal said that Aegis Srinagar has already tied up with Vodafone. "The Srinagar office
will serve domestic clients, including telecom service providers and financial institutions," said the
Aegis president, who provides strategic advice and guidance to teams across centres in India,
Philippines, South Africa, Australia and Sri Lanka.
He said that Aegis Srinagar will offer direct and indirect employment opportunities to over
2,000 youths from the Valley once it becomes fully operational. Lauding Aegis state president
Zahoor Malik, Agarwal said that he had ensured the "seamless introduction" of Essar Group's
ventures in Jammu and Kashmir.
Malik, in turn, praised the state government for helping Essar establish the centre. "The
government provided Aegis Limited with the space it required. From the foundation stone-laying by
Chief Minister Omar Abdullah to helping us commence operations, the state government has always
been by our side," he said.
Noting that the state-of-the-art Aegis BPO centre was spread over an area of 22,000 sq ft, he
said that local youths were recruited not only for the BPO centre but also departments pertaining to
housekeeping, transport, centre development and maintenance.
Elaborating on the technical aspects of the BPO, Aegis senior vice-president Faisal Durani
said that the capacity of the Srinagar centre is being enhanced from 250 to 500 seats.
Customer service executives and call centre agents are inducted into the BPO centre only
after being trained extensively for a month, he added.
http://www.business-standard.com/india/news/aegis-launches-bpo-operations-in-valley
Page 17
RURAL BPO- Beginning A New Era of Freedom
So far KASHMIR has got only one BPO Centre by the name AEGIS which is a multinational
company. Kashmir also has got KHIDMAT CENTRES – a J&K Bank Initiative. Thus the
opportunity for setting up a single or multiple rural BPO units is eminent. This provides a huge
entrepreneurship opportunity both in terms of investment, profit and growth.
Page 18
RURAL BPO- Beginning A New Era of Freedom
Considering Kashmir, the above facilities are already available. The most important aspects
to develop would be the connectivity and local manpower capabilities. Though connectivity can be
established with the help of telecom service providers in short time, the capacity building of the
manpower is a development process and would take some time. Considering that language skills are
also to be developed, a reasonable estimate of 9 months to 12 months should be taken for
development of manpower to be ready to work as process agents in the BPO unit.
Considering the above, it is proposed to set-up a “GAAMZAN” BPO unit in above
mentioned areas on the basis of a properly designed Project Implementation Plan. As a public-
private partnership model, Department of Commerce and Industries will be approached.
1. Identifying problem areas and bottlenecks in implementation, management of rural BPO unit,
4. Creating job opportunities for rural educated youths and help develop their potentiality for
Page 19
RURAL BPO- Beginning A New Era of Freedom
locations present a very strong case for establishing BPO centers. Though these parameters place a
convincing scenario but the absence of adequate faith amongst entrepreneurs to invest in rural
Kashmir remains the main concern because of the various prominent reasons, sensitivity of Political
Status remains prominent. This has led rural youth‟s large-scale migration to outside state for better
opportunities, causing substantial brain-drain in the Kashmir Valley. Result – the villages have not
been able to keep pace with the urban development and continue to remain backward. I, with, Mercy
Corps have taken up the current study to understand, analyze and help scoping the feasibility
parameters for setting up a Rural BPO “GAAMZAN” providing Rural BPO Services.
Page 20
RURAL BPO- Beginning A New Era of Freedom
As per the scope of the study and taking into consideration the telecenters capabilities in rural
India, the Rural BPO Research project needed a detailed study comprising of literature review,
comprehensive primary and secondary research on BPOs, Rural Telecenters, Village households and
statistics, Skill-set availability at village level, Jobs suitable for rural BPOs, challenges and
opportunities for rural BPO, and other relevant areas.
Following research methodology was adopted for the above study and to meet the research
objectives, which consisted of ten major stages.
1) Plan the research/survey activities
2) Schedule the survey activities
3) Design Questionnaire(s) for each survey
4) Execution of research/survey activities
(a) Secondary Research
(b) Primary Research
- General Population Survey
- Telecenter/ Khidmat Center Owners Survey
- Govt./ Private Organisations Survey
- Urban BPO Survey
(Questionnaires designed for each survey & Administered on target groups using sampling plan to
collect responses)
5) Survey Data Entry for analysis
6) Summarize the Findings - for rural BPO “GAAMZAN”
7) Analyze the Research/Survey Data
8) Report Preparation based on the analyzed data
Page 21
RURAL BPO- Beginning A New Era of Freedom
For the above study, a strategic plan including detailed project schedule was prepared for
timely deployment of necessary resources to complete the study properly. This includes primary
research, secondary research, data entry and analysis, dummy model and scoping the feasibility
parameters - for providing rural BPO services.
Survey Location:
Page 22
RURAL BPO- Beginning A New Era of Freedom
A brief on the research/survey activities carried out for the project work is as presented
below.
Secondary research was carried out comprising of profound understanding of the past work
done in the field of Business outsourcing to figure out the issues related to BPO. Secondary research
sources included various research papers, study reports, periodicals and articles available on the
internet and libraries. Though there was hardly any reference to rural BPO feasibility, but the search
has helped in generating an overview of the prospective strengths and opportunities in the filed of
BPO business, in general, and to identify certain governing factors which promote the BPO activities
and the fundamentals of BPO business dynamics. Following are the secondary sources that were
referred for the study:
Research studies on BPO sector by
Page 23
RURAL BPO- Beginning A New Era of Freedom
The primary research was carried out for the study purpose in following target segments to
collect the desired data and facts, by a team of students who administered the semi-structured
questionnaires (designed) on the following target groups, as per the sampling plan that was defined:
Rural & Urban Households
Telecenter/ Khidmat Centre Owners
Urban BPO organizations
The surveys were aimed for necessary data collection from different groups to understand
their perspective and views on rural BPO feasibility and on current status and problems.
The surveys were supplemented with the information acquired through personal interviews
with the employees of urban BPO units and rural telecenter owners.
Data collected was entered into the statistical software (MS-Excel) for further analysis.
Page 24
RURAL BPO- Beginning A New Era of Freedom
A brief on the above mentioned four surveys that were conducted for the project (9 rural
districts and one in urban location) is as follows:-
Target group Mainly Rural people from 9 districts and urban from 1 district
Page 25
RURAL BPO- Beginning A New Era of Freedom
COMPUTER SKILLS
BPO EMPLOYMENT
N/A
NO 18% N/A YES
7% 18% 58%
YES
75%
NO
24%
HELPLINE ?
DATA WORK
6% RURAL ISSUES
ALL 13%
24%
B- PRACTICES
21% EDUCATION
36%
VISIT KC/BPO
FREQUENTLY
12%
NEVER
33% OCCASIONALY
22%
RARELY
33%
Page 26
RURAL BPO- Beginning A New Era of Freedom
Ten Khidmat Centres located in the vicinity of Kashmir and networked to the JK Bank SCA
(Service Centre Agency) under National E-governance programme were randomly selected for the
study.
Survey questionnaires were administered on Khidmat/Telecenter owners for understanding:
Their willingness quotient to become part of Khidmat Centre.
Their present level of business.
Availability of Skill Set.
Problems faced in dispensing telecenter services
3) Urban BPO survey
Urban BPO questionnaire was targeted at 1 BPO organization (AEGIS), the only BPO in the
Kashmir Valley located at Rangreth Srinagar, for the following purpose:
To map the BPO jobs and related activities/processes.
To understand the overall BPO business dynamics.
BPO jobs and Skills-set/Training requirements.
Opinion/views on rural BPO and challenges
4) Govt./Private Departments Survey
The survey was aimed on members of various government departments like Non-
digitized Banks and Telecom, to collect data/information on:
Page 27
RURAL BPO- Beginning A New Era of Freedom
1) During field survey period, the Survey Team had to face the following major challenges.
Some major constraints/obstacles that were faced have been mentioned below:
Bad Weather condition.
Political Conditions in the Valley.
Transportation problem faced to reach distant Telecenters.
Took time to locate/contact the computer literates for their valuable responses.
2) During the survey period for Govt. Departments, the survey team had to wait for days to
get their permission based on the designed questionnaire. However, once the contact was established
it helped the team on valuable inputs for the research.
Due to above problems the survey period got extended to some extent, but it did not affect
much on other dependent activities which had to be rescheduled to complete the project almost on
time.
Page 28
RURAL BPO- Beginning A New Era of Freedom
This chapter contains the outcome of literature reviews and the findings of the surveys
carried out. The findings are based on discussions with people in the BPO industry, an appraisal of
research studies on the BPO sector and the results of a primary survey conducted in various districts
of Kashmir Valley. From the efforts made to understand the BPO activities and business dynamics,
in urban BPO and Khidmat Centers, an attempt is made to identify feasibility of rural BPO viz-a-viz
jobs that match the skill-sets of rural manpower. The study also deals availability of
infrastructure/awareness at rural level and the employability of rural youth for BPO work. The study
has helped to identify the feasibility parameters for scoping, which is discussed in next chapter.
The findings based on secondary research on BPO sector and primary surveys conducted in various
districts (Govt. Departments, General Population, & Khidmat Centers) and on urban BPO have been
summarized below. It starts with the research findings based on literature reviews followed by
findings from primary surveys. At the end of the chapter, the knowledge and information gathered
from above sources is employed to identify the feasibility parameters controlling rural BPO business
viability.
Page 29
RURAL BPO- Beginning A New Era of Freedom
India has emerged as a strong contender as most favored location for setting up of BPO business.
There are various drivers, which favor India and help achieve the top position on worldwide BPO
platform. The major drivers for BPO business have been summarized and presented below.
Talent Pool
Kashmir Valley houses a large pool of talented people; hundreds of graduates, postgraduates and
engineers produced every year which can act as talent pool for BPO centers. Kashmir has got over
60% of youth aged 18-25 Computer skills. Outsourcing is driven by the cost competitiveness offered
by the low cost talent pool and infrastructure.
Infrastructure and Policies
The infrastructure and telecom facilities offered in various districts of Kashmir are comparative
to national standards. JK with its new IT policy can fuel the spread of IT based service providers.
Linguistic advantage
Kashmir hosts a large pool of skilled workers who are proficient in Hindi and English language
as found in survey on Urban BPO and the JK Bank CSE. Language proficiency is one of the factors
that attract Tier I & Tier II companies to look for outsourcing their business activities/operations to
Rural BPO in Valley.
Page 30
RURAL BPO- Beginning A New Era of Freedom
industry people and extensive secondary research and surveys were undertaken for urban BPO and
rural location having telecenter units.
Page 31
RURAL BPO- Beginning A New Era of Freedom
The quality of service depends on the type of training the employee receives and subsequently
how he implements his knowledge while working. Training is the integral part of the BPO
organizations and Telecenters. Following are the salient findings related to BPO training viz-a-viz
Telecenter Training. Most of the big companies have training department as a part of the human
resource department and onsite training is preferred than sending their agents to an external center.
Some companies prefer to outsource training to coaching/training companies.
Outsourced training is conducted in two ways:
Outsourced-onsite Training: In this the trainers are provided by the training companies but
the training sessions are conducted within the premises of the call center.
Complete Outsourcing: Outsourcing training completely means that a training agency is
hired and either the recruited agents would be sent to the agency for further grooming or the
agency trains and then company hires the candidates.
The nature and kind of training depends on the BPO activities undertaken by the organisation. For
example, the training given by voice based BPO units is different from the training imparted by non-
voice outsourcing unit. During survey it was observed that call center & domestic training could be
divided into two types.
Page 32
RURAL BPO- Beginning A New Era of Freedom
In case of Telecenters or Khidmat Center, again two types of training are given to the potential
owners:
b) Specific Training
- Related to E-governance
- Related to Services
- Bank Documentation
Following are the challenges that are being experienced by the surveyed BPO/ Telecenter
organizations and are the possible threats for the outsourcing industry.
Page 33
RURAL BPO- Beginning A New Era of Freedom
2. Call Centers
A typical call center is a service center (for customers), which has adequate telecom
facilities, trained counselors, access to wide databases, internet and other on-line information
support system. It operates to provide services to customers, round the clock and year round. The
dedicated telecommunication links connect a remote call center to the parent organization through
voice links and on line computer database access. Amongst others, the service application areas,
which may be addressed by call center include:
Sales support
Lead generation and follow-up
Tele-Marketing
Complaint handling
Page 34
RURAL BPO- Beginning A New Era of Freedom
- Land Records
Page 35
RURAL BPO- Beginning A New Era of Freedom
The understanding of available literature, Desk work and discussions with BPO and Khidmat
Center owners helped us understand that there is no single model which could lead to rural BPO
success. Different rural BPO organizations have tried to develop their own business models based on
their requirements and ability. Also some have succeeded in rendering outsourcing services by
locating in rural suburbs. Therefore it is necessary to have an inspired thinking which could lead to
sustainable rural BPO operations.
The main four inputs for BPO business have been summarized earlier as; Infrastructure,
Manpower, Technology and Investment. The cost of technology (hardware and communication) is
not location sensitive; however the availability of technology could be important. The extensive
research through secondary sources and in-depth surveys helped us to identify and select key factors
which could affect the location suitability for BPO business.
A computer with software and Internet connectivity is a sufficient and necessary condition to
access and deliver desired services for BPO. But in the context of outsourcing as a business and
investment opportunity that would transform rural economy and its possible contribution to long-
term growth and development; the factors and variables that are relevant for any other sector would
be relevant to outsourcing business in rural areas as well.
Hence parameters are viewed on a larger context of maximum contribution to rural
community, livelihood opportunities, rural economy, institutional factors and in general to rural
transformation. After having examined all the possible factors influencing rural BPO feasibility,
from the study, the necessary ones were identified for scoping feasibility for providing BPO services
involving rural telecenters and have been grouped into five broad parameter heads, as mentioned
below:-
Page 36
RURAL BPO- Beginning A New Era of Freedom
Rural Dynamics:
Rural Youth Population
Entrepreneurship in community
Telecenters/Cyber-cafes existence
Rural Infrastructure:
Rural Electrification
Rural Telephone Connection
Electricity Availability Hours
Road Condition & Transportation facility
Rural Orderliness:
Bandh/Strike prone
Natural Disaster (Type & Severity)
Govt. Policies:
Incentives and subsidies specific to IT sector
Page 37
RURAL BPO- Beginning A New Era of Freedom
RURAL KASHMIR
ISSUES
DATA WORK
BUSINESS
EDUCATION
Call Center
RURAL BPO
DOMESTIC CLIENTS
Page 38
RURAL BPO- Beginning A New Era of Freedom
The whole project would start in phases and will cover Two phases initially:
Low skill Jobs (LSJ) Medium Skill Jobs (MSJ) High Skill Jobs (HSJ)
Page 39
RURAL BPO- Beginning A New Era of Freedom
Page 40
RURAL BPO- Beginning A New Era of Freedom
The rural BPO model should be designed in a manner that it should be able to generate
enough revenues for the entrepreneur and thus manage its operational cost. Thus to test the business
possibility of a BPO centre a break even analysis is undertaken, considering a 20 heads rural BPO
facility involved in low skilled jobs like conversion of content from paper to digital or even pure
data entry (PHASE I).
The initial investment would include cost of hardware, software and other infrastructural
cost; Apart from these, there are recurring costs, such as manpower, electricity and telecom. During
the analysis it has been assumed that there is sufficient supply of jobs at any point of time.
An initial investment of Rs. 7,00,000 (Rupees: Seven Lac only) is required to set up the
above “GAAMZAN” with 20 seats and necessary hardware. The calculations featuring operational
costs shows that total manpower cost for the BPO center would be Rs.89,000 per month, hence the
total operational cost would amount to Rs. 1, 07, 812 per month. In order to demonstrate the
commercial feasibility, the rural BPO must be able to generate revenues of the order that are at least
sufficient for managing the operational cost. Secondary Research Analysis shows that an average
income of Rs.27 per employee per hour will make the unit break even and any penny above this will
result in profit.
Page 41
RURAL BPO- Beginning A New Era of Freedom
Seeing the statistics of urban BPO centers elsewhere involved in low skill jobs like data entry it is
observed that trained operators are able to earn anywhere between Rs.30 to Rs.35 per hour and in
some cases it goes up to Rs. 45 per hour for the operators who continue working on a single
assignment for long duration which leads to improvement in their efficiency.
1. Revenue per month at earnings of Rs 30 per per Hr. per Rs. 1, 20,000
operator
2. Profit per month Rs. 12, 188
Time to return the investment 38 Months approx.
1. Revenue per month at earnings of Rs 35 per Hr. per operator Rs. 1, 40, 000
2. Profit Per month Rs. 32, 188
Time to return the investment 16 Months approx.
Based on the above analysis, it is now imperative that revenue of Rs.250 to 300 per day per operator
will be enough to meet the operational cost as well as to help repay the initial investment in a short
or mid term span.
Page 42
RURAL BPO- Beginning A New Era of Freedom
Page 43
RURAL BPO- Beginning A New Era of Freedom
Assumptions A 20 executive BPO facility executing low skilled back office jobs like data entry or
other transaction based jobs.
(Approx. figures in Rs.)
Nos Rate/month (Rs) Total Salary (Rs)
Page 44
RURAL BPO- Beginning A New Era of Freedom
4.5.3 FUNDING:
ii. Loan from DCI @ 18% Subsidy under ED Scheme = Rs. 2, 00,000
Page 45
RURAL BPO- Beginning A New Era of Freedom
There are a number of clients, who wants to outsource works locally. Government of J&K,
for instance, has plans to digitize official records, land records, electoral list etc, as part of
e-governance initiative. This would be a mammoth exercise, which would require enormous amount
of labor in the rural parts.
Page 46
RURAL BPO- Beginning A New Era of Freedom
Outsourcing is not a one time effort aimed to reduce operational cost and manage short term
relationships; it is about delegating operational capabilities and management as-well-as to add value
and build long-term relationships. India is surely riding the high wave of BPO business, but
initiatives like rendering outsourcing services through existing telecenter network have been in its
latent state. A SWOT analysis has been undertaken to understand the strengths, weakness,
opportunities and threats for such rural initiatives through rural BPO.
a) Strengths:
Vast telecenter network availability: Existence of number of telecenters in different parts
of Kashmir provides a huge untapped potential to cater BPO services.
Low investment cost: Investment costs are lower than setting up a BPO unit in urban areas.
Absence of attrition: Since there are less opportunities for employment in private sector in
Kashmir, attrition is near to impossible.
Low business management and marketing capabilities of Khidmat Centers: Though
telecenters provide a host of ICT services, but the operators lack the management and
marketing capabilities for BPO jobs. Here lies an opportunity for a rural BPO.
b) Weakness:
Poor infrastructural availability: The rural infrastructure in most of the areas in Kashmir is
poor. It is very difficult to locate the exact location of BPO.
Political sensitivity of the State: The political situation of the Kashmir Valley is highly
flexible.
High Risk: Risk involved is more than elsewhere in world.
Page 47
RURAL BPO- Beginning A New Era of Freedom
c) Opportunities:
Low manpower cost: The wages/manpower cost in the rural areas are low as compared to
urban region, which provide an edge to Rural BPO.
Income generation and employment opportunities: Rural BPO outsourcing jobs will
certainly help in creating job and livelihood prospects for the local people.
Enhanced rural economy: Such rural BPO will help in long run to generate new economic
activities.
d) Threats:
Increasing global quality standards: The ever rising quality requirements of the clients
could be a bottleneck in such outsourcing initiative, as it will require intensive training for
the employees of rural BPO.
Data security: Providing and ensuring data security for the clients data and information, at
the rural BPO, could be a uphill task.
Page 48
RURAL BPO- Beginning A New Era of Freedom
In continuation to this study, the areas that can be taken up for future research work on rural BPO
services are as suggested below:
Page 49
RURAL BPO- Beginning A New Era of Freedom
1) Categorize the rural locations district-wise for their readiness on BPO initiatives, in terms of
infrastructure, telecenters concentration, conducive environment, etc.).
2) Work for possible Tie-ups with outsourcing partners in Tier I and Tier II cities.
3) Business awareness and education is mandatory to change perception of people
4) Practical Exposure to the valley students is the need of hour for them, to be employable at all
levels of business spectrum.
5) Computer Training and outsourcing is the order of the day, it must be promoted.
1) Explore the role of rural telecenters to facilitate rural e-Commerce for accessing better
markets for the local produce (agri, handloom, artisan, etc.) The above are some of the areas
that can be taken up as further research work for outsourcing services through the rural BPO.
2) The already existing BPO must be encouraged to enhance employment and develop a work
force who can serve the entrepreneurship drive in the valley.
Page 50
RURAL BPO- Beginning A New Era of Freedom
Above mentioned suggestions are not complete until there is Govt. Support, therefore it requires a
joint effort of private and public partnership to improve upon the existing scenario which could
make the rural BPO as a viable business proposition. The respective local Governments should work
in tandem with private institutions to create a conducive atmosphere for the growth of IT industry.
i. Governments should bring out pro IT policies which are transparent and stable. Also they
must ensure to promote new & innovative entrepreneurs by offering special incentives,
subsidies and rebates to them.
ii. There should be enough rural banks and micro-finance institutions which could offer low
interest loan to the entrepreneurs to set up BPO business unit. An effort could be made to
provide special subsidies on IT hardware and software for low income groups so that they
could come forward to take up such jobs and uplift their social and economic status.
iii. Electricity and telecom infrastructure should be upgraded in the rural areas to provide constant
electric supply. The Govt. departments can engage local NGOs like THE HOPE
FOUNDATION GANDERBAL to promote the literacy and IT education so that more number
of people could be made available as manpower.
iv. Govt. in association with schools and colleges in the region should develop BPO specific
programmes and modify curriculum in entry-level educational institutions. Also some Pvt.
Partners ASPIRE solns...we create employability & international NGO‟s for conflict zones
like THE MERCY CORPS could be roped in to develop BPO industry oriented courses.
v. Most importantly the Government can act as a client to the rural BPO initiative by transferring
some of its back office jobs to the rural end. Support from local bodies can help the BPO
model to attain viability in a short term.
Page 51
RURAL BPO- Beginning A New Era of Freedom
CONCLUSIONS
The outsourcing business in India is based on sound fundamentals. But as the market
gets over exposed, certain chinks develop that threaten the very basis of the existence of the
business. India has got the competitive advantage to capture a good share of the global
outsourcing market and rural INDIA, the DOMESTIC outsourcing market. Only constant
innovation and spotting new opportunities can help rejuvenate this competitive advantage.
Current trend therefore is that, the outsourcing companies are moving towards tier III cities
for their outsourcing operations and rural BPO “GAAMZAN” is definitely one of those
business innovations that will help Kashmir to begin a new Era of Freedom.
Page 52
RURAL BPO- Beginning A New Era of Freedom
LIMITATIONS
1) This project is a start up work in the field of entrepreneurship in the valley that too at the
2) The general survey was conducted on the respondents who were mainly in the age group of
18-28 years, hence the perception and awareness may vary for other age groups.
questionnaires.
4) The exact location for the implementation cannot be ascertained to be a proper rural area,
5) The project may need a further thorough study of the risks of all spheres (Political, social,
Economical & Technological) from the perspective of Crisis Management involved in the
Page 53
RURAL BPO- Beginning A New Era of Freedom
1. http://www.desicrew.in/
2. http://www.harva.co.in
3. http://www.business2rural.com
4. http://www.nasscom.in/upload/43171/Rural_BPO.pdf
5. http://www.tenet.res.in/
6. http://www.bpoindia.org/faq/setup-guidelines.shtml
7. http://india.gov.in/allimpfrms/alldocs/8946.pdf
Page 54
RURAL BPO- Beginning A New Era of Freedom
ANNEXURE
QUESTIONNAIRE COVER PAGE:
1. Name
2. Age
3. Gender
4. Education
5. Address
6. Phone. No
7. Email
8. Designation
9. Experience in
the sector (in yr‟s)
Page 55
RURAL BPO- Beginning A New Era of Freedom
Project Purpose: Reduce poverty and foster inclusive economic growth through increased youth
entrepreneurship in the Kashmir Valley.
Research Purpose: To reduce barriers, improve support and strengthen a culture of youth entrepreneurship
that stimulates the start up and growth of at least 200 youth enterprises in 10 districts of
the Kashmir Valley.
Confidentiality: Your Identity will be kept confidential and nothing that you say in the course of this
research will be attributed to you unless you authorise it. Your real name will never be
used in any written report or article or oral presentation that results from research. You
are free to ask questions about the research process and to choose to stop participating at
any point. If you choose to withdraw from study, any data collected from you will not be
used.
Signature of participants:_________________________
Date: ________________
Page 56
RURAL BPO- Beginning A New Era of Freedom
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
i) 0-50
i) 50-100
ii) 100-200
iii) >200
iv)
6. Are trained people available as per your requirement? Yes/No
8. Which skilled workers are required but not available (approx. no.):
____________________________________________________________________
____________________________________________________________________
Page 57
RURAL BPO- Beginning A New Era of Freedom
10. What is the minimum qualification that you seek, in skilled workers: (Please tick
i) Diploma holders
ii) ITI pass-outs
iii) Under-graduates
iv) School-drop-outs
v) Any other, please give details: ____________________________
i) Yes ii) No
12. If yes, then please specify the type of training and the duration to be provided:
______________________________________________________________________
______________________________________________________________________
13. Any other suggestions for development of IT& BPO industry in Kashmir:
_______________________________________________________________________
_______________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_________________________________________________________
Page 58
RURAL BPO- Beginning A New Era of Freedom
Department/Organizations:
1. In your department, what are the processes that are highly dependent on IT?
2. What is the amount of work load that you think must be outsourced?
i) Very High
ii) High
iii) Moderate
iv) Low
v) Very Low
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________
Page 59
RURAL BPO- Beginning A New Era of Freedom
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________
5. If you have to outsource any part of the work what will be the process?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________
Page 60
RURAL BPO- Beginning A New Era of Freedom
7. How many people do you know from your locality who is computer literates?
_________________________________________________________________________
8. If you are provided employment or a job in a BPO sector would you prefer to join that
Page 61
RURAL BPO- Beginning A New Era of Freedom
___________________________________________________________________________
___________________________________________________________________________
________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
_____________________________________________________________________
Page 62