BPO : Taylorism Redux

11 08 2009

Recently I had an opportunity of interacting and studying Business Process Outsourcing (BPO) operations closely. Till now, I had read about them in media and through books like Chetan Bhagat’s “One Night at a Call-center”. The perception that I had about BPOs  was of fun places as many young boys and girls work together. Their steel and glass buildings with multiple levels of security are so intimidating that I never ventured going beyond their reception. 

The BPO unit I visited is a captive unit of an MNC financial services company. Besides, the traditional voice-work, this unit also does a lot of non-voice work. I had some vague idea of what this non-voice or transaction processing entails. But I had never got a chance to look at them closely.

I met a small team of young MBAs who were engaged in the P2P process. One team is engaged in servicing their US offices and other their UK offices. (P2P is BPO jargon for procure-to-pay. Procure-to-pay in turn is what we would call the traditional purchase or procurement process). At the end of the interaction, I am amazed, bewildered and depressed all at the same time.

I am amazed because of the level of sophistication which the MNC have been able to bring to a rather routine process of procurement. It is not just the use of IT systems but doing away with the very concept of a store. Most purchases are where the user directly places the order with the vendor and the vendor supplies, based on a pre-agreed service-level agreement. I have not seen any Indian company taking so much care to study their vendors’ business and risks associated with doing business with their vendors. For most Indian companies vendor registration is a one-time affair and after which it is more of a relationship between the vendor and the purchase manager. There is no concept of an inspection, either before dispatch or after receipt. If the user complains about quality, the vendor will have to address the complaint.

I am bewildered because the rather short P2P process has been broken into as much as 60 activities. The activities range from Business analysis of the vendors, financial analysis, risk assessment of the vendors to contracts uploading, invoice verification and settling disputes. The items purchased are bunched into various categories and there is a separate buyer for each category. For example, there is a buyer who looks at the paper category. His entire job is to finalize contracts for 1000s of different types of stationery and paper items the company requires.

What depresses me is that out of these 60 activities, each employee just handles 2 activities. Day-in and day-out he or she is just doing the same activities repeatedly to achieve efficiency. The employee has little or no idea of the other activities in the full process. Besides emails and phone calls, they have no idea who the user of the materials or service is. Most of the materials they buy is just a code on the IT system and they may have never seen the item physically. They also have no face-to-face interaction with the vendor with whom they negotiate on behalf of the company. The hard work that they put in for nine hours everyday is largely irrelevant outside of the company in which they work. Hence, there is no real domain knowledge or skill they acquire doing this repetitive activity. Even though the work is carried out from India, the employees have little or no clue of the Indian business context.

The work-processes in a BPO like this remind me of the scientific management principles of Frederick Taylor. Taylorism is a theory of management that analyzes and synthesizes workflows, with the objective of improving labor productivity, division of labor. The key criticism of Taylorism was that it pushes division of labor to such extremes, that it leads to de-skilling of the worker and depersonalization of the workplace. I see Taylorism beneath the glossy façade of BPOs.

There is much that Indian industry has to learn from the MNCs in terms of business processes and management. But, it is too naïve to expect that the employees of these captive BPOs would be able to transfer this knowledge. The presence of such cutting edge MNCs in Indian soil will have little benefit for the Indian industry.

– G. Mohan




6 responses

22 08 2009
Jacob Mills

Hi Mohan..Its a good idea to keep your experience here in a wonderful blog. I Think This will make many people to think about the call centers, and you have done a good job from your side. Thank you very much.

25 08 2009
Fedric Lewis

WOW its wonderful to have a such a nice experience.I think now you can make it clear that the BPO Job is not that much easier.It also having so much of rescue.but Mohan you must be appreciated for sharing such a nice experience with us..Thank you

26 08 2009
Michael Hopes

Its all good enough to make such a nice opinion on BPO Industry.and we can understand emotions and you have done an amazing task here by presenting in the form of a blog.Thanks for sharing with us Mohan.

30 08 2009
Venkat Subramaniam

This article brings to light the dehumanizing aspect of some of the present day organisations which under the garb of jargons like ITES and BPO have reduced their employees to mere resources like any other non-living resources that they manage. In many of the so-called consulting outfits, the word ‘resource’ is used by the managers very casually for the word ‘consultant’. The word ‘human’ and more importantly the aspect ‘human’ is very conspicuosly missing.

In the movie ‘Modern Times’ the mechanisation of blue collar workers was very humoursly portrayed by the Great Charlie Chaplin. In our times we can see the same transcending to the ‘white collar-knowledge workers’ of the IT, ITES and BPO organisations.

In my opinion, insensitivity is a natural follow through with anything that is abundant or large in numbers. A glaring example of that is the population of India and the extent to which we value human life vis-a-vis other countries that have lesser population. The same applies to our IT industry which literally changed the number game when compared to its predecessors viz., manufacturing and other traditional industries.

Hence the whole paradigm of the so-called HRD functions changed resulting in mass recruitments without too much concern about quality during euphoric times; followed by mindless retrenchment schemes during bad times; rendering the so-called knowledge workers completely uncertain and confused about their standing.

I think, In the name of efficiency and performance, somewhere we have lost touch with the collective capabilities of human beings; which reflects in the way employee performance is measured today (where the benchmark is a robot).

12 09 2009

I agree with your views Mohan, the scenario you describe can be depressing. The BPO is the new “factory”

Do you think the scene in Indian BPOs is any different ( vs captive MNC BPOs) ?

16 02 2010

What is seen in the MNC captive is what is being done by MNC’s everywhere.
In India I have seen everyone trying to understand what others are doing (which I think is the basic Indian nature) but in the Western World no such thing is possible as everyone is very busy with their lives. I have seen, especially with the younsters in the Western World, work habits which will not take them anywhere in the corporate world.

I have been directly involved in captives (as IT head) and as a client now to many of the top BPO firms and I see that the staff in India are really smart, eager to learn new things so the assembly line type activities, at least so far, don’t seem to have affected the people.

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