KPO to Generate Employment for 280,000 People by ’10 – Evalueserve


According to a white paper published by Evalueserve, an Indian KPO company, the Indian KPO industry is expected to generate employment for about 280,000 professionals and earn revenues of USD 11-12 billion by 2010. The industry recruited about 75,000 professionals and earned revenues of USD 3 billion in 2006. The increasing demand for KPO services from small- and medium-sized enterprise (SME) segment and the acceptance of the KPO model are major forces driving this growth.

Among the key findings, the number of SMEs depending on captives or third-party KPO service providers is likely to increase from 900 in 2006 to 5,000 by 2010. In addition, KPO service providers are expected to increase their capacity by 55 percent, while capacity in the captives is likely to increase by 45 percent by 2010.

Vendor model (buy model) is likely to outgrow the captive model (make model) by 2010. The cost and time involved in implementing a third-party vendor solution is less as compared to the time and cost involved in establishing captives. These advantages will encourage SMEs and other big companies to opt for the buy model as compared to make model; about 90 percent of centers are expected to be built on the buy model by 2010.

In addition, KPO vendors have been expanding their operations in Latin America and China to offer their services in multiple languages. About 5-10 percent of the US and European SMEs are expected to benefit from KPO. Dual-sourcing (outsourcing work to their captive and external vendors simultaneously) will be an emerging trend among large companies having captives.