The office of ProcessMind, around the corner from a granite temple to Hindu God Ganesha, springs to life just as most Bangaloreans head home after a hard day's work.
Inside the outsourcing firm's ash-grey concrete building, women in colorful tunics pore over details that matter two continents away: Texas insurance regulations and specifications for parts needed by a Detroit carmaker.
India's back-office service revolution, which started with humble call center agents with affected US accents, is now hunting for people with MBAs, insurance diplomas, and even PhDs. New fields for the lucrative business include securities research, project management, underwriting and demand forecasting.
"I think Indians are fundamentally good at mathematics and analysis," said Phaneesh Murthy, chief executive of software services firm iGATE Global Solutions Ltd, a subsidiary of US-based iGATE Corp.
Fears of a Western political backlash against jobs moving overseas is a hot topic, but Indian firms shrug it off. Outsourcing is here to stay because businesses want to cut costs, not play politics, said Murthy, who used to head global sales for software services firm Infosys Technologies.
After cornering 60 percent of the US$16 billion offshore information technology services market, India is now poised to boom on the next big thing: outsourcing of financial services. Services include everything from data entry and credit card customer support to stock research and debt ratings.
Some two million jobs, or 15 percent of the financial industry's total, could move offshore in the next five years, with half of them going to India, according to researcher Deloitte Consulting. By 2008, the financial industry will shift US$356 billion worth of work offshore each year for cost savings of 40 percent, or US$138 billion a year, Deloitte said.
Driving the boom are a huge talent pool among India's billion-plus population, wages a tenth of Western equivalents and the belief Indian workers can do much of the number crunching that precedes final decisions overseas.
"It takes a long time to grow up the learning curve on this, but after that, you are locked in," said Nimish Soni, managing director of privately held ProcessMind Services Inc, which specializes in insurance processing and project management.
WALL STREET CALLING
Signs of a boom are starting to emerge. Investment bank J.P. Morgan Chase and Co started a Wall Street trend in April when it announced plans to set up an offshore equities research unit in Bombay.
The No. 2 US financial services firm expects to hire 40 junior analysts and support staff this year in Bombay, where top business school graduates can be hired for as little as US$8,000 a year, a quarter to a tenth of the salaries their counterparts will earn in New York.
Back-office jobs in financial services rose to an estimated 24,000 in the year to March 2003 from 15,000 a year earlier, and revenue to US$510 million from US$300 million, according to India's National Association of Software and Service Companies.
A rise in equity research could boost the segment further, leading to forecasts that global offshore finance and accounting services will hit US$65 billion in 2006 from US$36 billion in 2001.
Some 100,000 jobs have sprung up in the past two years in India's back-office services sector, more than doubling the workforce to 170,000.
Investment banks such as Morgan Stanley, Goldman Sachs and Citigroup Inc are among those mulling the benefits of shipping research jobs overseas.
Consultant McKinsey & Co opened its global knowledge unit in Delhi years ago. And A.T. Kearney, having shifted a good deal of its research to India, is now advising clients to do the same.
The consultancy said in a recent report that US financial service firms were planning to relocate 500,000 jobs, or 8 percent of their workforce, offshore over the next five years. It said India was a "top rated" location based on people and costs, but added rising wages or geopolitical issues -- a reference to India-Pakistan military tensions -- could erode the advantage.
NEW SKILLS
As outsourcing grows, Indian workers are tapping new skills.
ProcessMind staffer Meera Ramachandran is an FLMI, or a Fellow of the Life Management Institute in the US. Colleague Lata Suresh is an engineer who monitors a car giant's vendors.
"It is pure project management that involves planning, monitoring and tracking," Suresh said of her work.
Industry analysts say high-skilled Indian experts at the top will be aided by a larger army of less-skilled workers. Supervisors can earn between 200,000 to 1.2 million rupees (US$4,324-US$25,946) a year, depending on their skills, while similar US workers would earn US$32,000 to US$40,000.
"The supervisors will have much more experience and built up domain knowledge [on industries]," said Avinash Vashistha, managing director of NeoIT, a technology business consultancy.
General Electric was an early mover in the analytics business. While most of GE Capital's 11,000 Indian workers are call center agents, it also has a 400-strong "center of excellence," which analyzes credit card data and demand trends.
The bottom line: India is moving up the value chain, says Shantanu Deshpande, a PhD in statistics who earlier worked for GE and is now head of analytics at data analysis firm Quintant. Quintant was recently acquired by iGATE.
"We believe labor arbitrage is just the icing on the cake," said Deshpande, who helps a US bank zero in on rich customers. "Analytics and business process re-engineering are the real differentiators."
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