Gurgaon: The Promise of a Global Business Destination 19th May 2010
Discussion Agenda Indian IT-BPO sector: Brief profile Gurgaon: Profile of a Business Center As an IT-BPO Destination Gurgaon: Location Assessment
Despite the economic slowdown, India’s IT-BPO sector displayed resilience to grow by 5.5 per cent IT-BPO revenues (USD billion)
India continues to take centre stage with 51% of total sourcing market
IT-BPO export grew an average 6 per cent driven by increased revenues from outsourcing segment; in BPO, vertical services accounted for 18 per cent revenues, indicating shift to vertical specific platforms
Revenues from domestic market grew nearly 7 per cent driven by 60+ large transformational deals in Telecom, Retail, BFSI, E-governance
BPO continues to be the fastest growing segment at 25%; IT services grew by 6%
Industry directly employs nearly 2.3 mn professionals
The industry has had a significant impact on the Indian economy:
Accounted for 30 per cent of incremental exports from India during FY05-09
Provides employment to ~8 million people in ancillary industries
Balanced regional growth with expansion into tier 2/3 cities
60% IT-BPO companies employ differently-abled people
Direct Employment (‘000) Dom. mkt BPO exps IT exps Source: NASSCOM
Gurgaon – an outsourcing & offshoring hub 1IBEF, Source: ATK–NASSCOM Study
One of the leading IT- BPO destinations in India accounting for over 5 per cent of the total exports Gurgaon – Total employment in FY09 in the IT-BPO exports industry (in lakhs) Share of Gurgaon in the Indian IT-BPO exports FY09* Direct Indirect Employment Total Employment 100%= USD 47.1 billion * NASSCOM estimates
Gurgaon: An attractive BPO destination…. INDICATIVE Language Proficiency:
Proficiency in English language is good indicating suitability for international voice and non-voice related BPO services. Hindi being the predominant local language, high potential for domestic BPO services.
Strong in voice based contact centres, telemarketing, collections, airline and financial services. Ample supply of professionals and domain experts from other industries prevalent in the NCR like Banking, Telecom, Real estate, Manufacturing, Retail, Government
Large pool of qualified candidates is available due to inbound migration and high outurn of students. Around 13,000 engineers graduate per annum from the NCR region and around 78,000 graduate per annuam from NCR adding to the employable pool.
Over 32 IT SEZs covering more than 1,300 hectares are in the pipeline
Proximity to Delhi airport with excellent air connectivity to metros and other Indian location
Work on Delhi Metro Rail stretch to Gurgaon has started and will be completed by 2010
Telecom connectivity excellent with multiple vendors providing services
Source: NASSCOM, News articles
….and a hub for most major Indian and MNC IT companies INDICATIVE TYPE PLAYERS KEY HIGHLIGHTS INDIAN MNC Source: NASSCOM
Favourable business environment and infrastructure adding to the city’s attractiveness
An attractive destination for various industries – Automotive & ancillary, Garment Manufacturing, IT-BPO, Real Estate
The Government of Haryana considers IT-BPO a thrust sector going forward and is actively encouraging the growth of the sector in the state.
Access to connectivity infrastructure in Delhi wherein local, national and international connectivity improvements are underway a major incentive for companies to set shop in Gurgaon
Given the diverse sector opportunities, ability to draw manpower is good especially when coupled with the influx from other locations across India
High Mature Attractive Mumbai Delhi Bangalore Location Attractiveness Gurgaon Noida Needs development support ‘Explore focused operations’ Low Low Cost of Operations High *Government support for the State/UT in which the location is present ** Estimated difference in cost of operations between the above location and the average cost of operations across all the leader locations. A negative number indicates a cost higher than the average cost across the Leader locations Source: NASSCOM-ATK: Location Roadmap for IT-BPO Growth 2008;NASSCOM
1 2 3 4 5 6 7 Local Connectivity National Connectivity International Connectivity Space Power Telecom Hotels Infrastructure facilities on par with other Leader locations……. Excellent Average Good Poor Source: NASSCOM-ATK: Location Roadmap for IT-BPO Growth 2008;NASSCOM
8 9 10 11 12 13 Medical Facilities Educational Facilities Recreational Facilities Social Infrastructure Security & Hygiene Cost of Living …….and a healthy cost of living and educational facilities Excellent Average Good Poor Source: NASSCOM-ATK: Location Roadmap for IT-BPO Growth 2008;NASSCOM
Inadequate International level higher education facilities
12 14-May-10 An Introduction to NRC - Gurgaon Formed in Dec ‘08 to address on local issues faced by the member companies operating out of Gurgaon – think global, act local. Chaired by Mr Pavan Vaish of IBM Daksh and Co Chaired by Mr Subinder Khurana of Cognizant. Council members are from the senior management team of NASSCOM Member Companies from Gurgaon. Some of the prominent member companies who are part of the council (indicative list only) – IBM Daksh, Cognizant, Microsoft, Genpact, MakeMyTrip, Quatrro, Convergys, Dell, Serco, Wipro, Parsec, Annik Systems & Interglobe Technologies. Structured through Special interest Groups (Infrastructure & HR) and the CEO Gurgaon Forum.
13 14-May-10 The Regional Council Meetings The Regional Council meetings are held periodically (once in a quarter or so) to update the members on the progress made by the Special Interest Groups or SIGs. For the period Dec ‘08 – May ‘10, six such meetings have been held. The first meeting was held on 12th Dec ‘08, chaired by Mr Pavan Vaish of IBM Daksh. The members deliberated on some of the areas which needed to be addressed with immediate effect. With recession looming large, the primary concern was “EMPLOYEES” – on morale building, retention, rightsizing, productivity, compensation and a host of other issues. The other pressing need was effective traffic management. Traffic snarls is a major deterrent in Gurgaon, and needed to be addressed immediately. This has been an effective platform to get a collective buy-in from the CXO community in order to drive the initiatives.
14 14-May-10 Special Interest Group - Infrastructure A common platform for Admin & Infra Heads to share best practices. Main area of concern – unruly traffic causing regular traffic jams. Improve on the road condition, removal of illegal hoardings, landscaping, addressing parking related issues etc Security. Driven by Mr Subinder Khurana of Cognizant 14 such meetings have been held during the period.
15 14-May-10 Initiatives undertaken by CyberCity Welfare Society CyberCity Welfare Society (CWS) is a nonprofit industry associationsupported by NASSCOM and several large domestic & multinational companies operating in Sector 25A, Gurgaon. Working in collaboration with authorities of Govt of India & Govt of Haryana to improve quality of life & highlight issues like encroachments, traffic management, security & environment through Public-Private Initiative (PPI) & partnership, in consonance with the views and directions of the Hon'bleChief Minister, Sh. Bhupinder Singh Hooda. Engaging with Distt Administration (DC, Police, HUDA, Municipal Corporation & Horticulture Department), NHAI, DLF and HSIDC. Improve on the road condition, removal of illegal hoardings, landscaping, addressing parking related issues etc
16 14-May-10 Initiatives by CWS – Contd. Illegal hoardings & Encroachment- with notification and support, the government authorities led by the Municipal Commissioner Mr. R. K. Khullar, IAS, were able to do away with the illegal hoardings resulting in a changed landscape of Cyber City Gurgaon. Traffic Management
engaged with an external agency (Holistic) and placed trained traffic marshals at key locations in the area.
Have cleared gridlocks, illegal parking, and wrong-side traffic during peak hours.
Have also formed an Industry-Administration-DLF joint working group to improve traffic flow. A team led by Mr Gunit Ahluwalia, VP Quality at Genpact, along with personnel from Genpact and Cognizant have taken the lead in applying Six Sigma methodology. This working group includes members from DLF (Mr. Arun Anand, Exec Director, and team); and the government (Mr. RK Khullar, IAS and Mr. Alok Mittal, IPS and team). This group presented their initial findings during our last member meeting and was appreciated by all the participants.
17 14-May-10 Initiatives by CWS Security: The security of employees & residents of Cyber City has been a great concern for society. A working group consisting of Mr Sanjit Bal (Convergys), Mr Brian Connor (Chief Security Officer, Genpact), DLF, and Shri Alok Mittal, IPS (Jt. Commissioner of Police) has started working on improving security processes for all the buildings of the Cyber City area. Improvement in Infrastructure: The society has been a guiding and dynamic force in improving the infrastructure of Cyber City. With the help of DLF, they have been able to make U turns, signages, speed breakers, pedestrian crossings and a six lane arterial road (under construction). The traffic situation will drastically improve on construction of arterial road. Shuttle Services from Metro Stations: The society has initiated a pilot project to start bus shuttle services from metro stations. Besides reducing the traffic of cabs & personal vehicles, it will also reduce noise & air pollution.
18 14-May-10 Special Interest Group - HR Being driven by Mr D P Singh, Director HR , IBM Daksh Last year being the year of slowdown, the focus was always on HR – how to retain the best talent, motivate the workforce, compensation benchmarks, handling attrition , overtime, holiday on election days, were some of the primary concerns of business leaders. Necessitated the need to form a group which would share best practices and provide a sounding board to the members. Meetings are held once a quarter and is an opportunity for HR leaders to connect and find out how their counterparts are dealing with HR related issues in difficult times
19 14-May-10 CEO Forum Gurgaon Held once a quarter and attended by the CXO community of member companies based out of Noida. It is usually a one speaker format where we invite a speaker to address the participants on a topic of immediate relevance. Due to the slowdown last year, topics focussed on cost optimisation, productivity and leadership.