We recently presented at the Outsourcing ventures 2008 in Pune on the overall supply side challenges in the KPO industry with specific focus on recruitment challenges. The key takeaways from the analysis were:

The market for KPO is huge. Based on conservative estimates, we think the market is worth $10 billion by 2014, growing at a CAGR of 20% from 2003.

There are demand side challenges currently such as the financial crisis which has resulted in a freeze of business decision making in the financial services firms this quarter. In addition, KPO sale still requires a leap of faith for the client (and convincing from the KPO sales) that an outsourced arrangement can work, it carries value and results in overall reduction in costs.

But we think the supply side challenges are more severe. As a statistic, only half of the business school graduates are fit for KPO jobs. The key skills required for KPO work such as the ability to take a complex business problem and break it up into workable components, scheduling those components, applying smart ways of completing the tasks, effective client communication and strong business writing skills are not necessarily taught in business schools directly. The KPO industry also needs to get involved in the training of the students to transfer this practical business knowledge to the students.

The other major issue from the supply side is that the project management level resources in this industry are hard to find and take a long time to groom internally. These type of resources are the the foundation on which a scalable organization can be built.

To read more, see the attached presentation:sga_recruitmentchallenges_presentation

This entry was posted on Tuesday, January 6th, 2009 at 1:10 am and is filed under KPO Industry. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.