Chapter 3

Human Resource Management in Indian Call

Centres/BPO

Mohan Thite & Bob Russell

Acknowledgements: The authors are grateful to the Service Industry Research Centre,

Griffith University for providing seed funding to conduct the research project in India.

INTRODUCTION

Customer contact/ call centre services are now the most used form of customer

interface and present the ‘personality of the firm to the customer over the phone’

(Belt, Richardson & Webster, 1999). They are one of the fastest growing parts of the

information/service economy with employment constituting anywhere from 1 to 3%

of total employment in the USA and Europe (Batt & Moynihan, 2002). Contact centre

service settings differ from conventional manufacturing work in important ways. The

relative non-tangibility of output, lower levels of interdependence among workers,

consumers as co-producers, and the simultaneity of production and consumption (no

re-work) (Batt & Moynihan, 2006; Lovelock, 2005) add complexity to the concept of

quality in info-service work. To this list we can also add the phenomena of

globalisation, that is, the outsourcing and offshoring of interactive service work.

There has been considerable debate as to the nature of the employment that is being

created in call centres, or conversely the type of employment that is required for this

form of service delivery (Russell, 2004). For some, call centre service delivery

represents the arrival of mass production techniques to the realm of service provision.

1
Automated delivery of work, short job cycles, consisting of highly repetitive work

activity and new capacities for electronic monitoring create new ‘assembly lines in the

head’ (Bain et al, 2002; Callaghan and Thompson, 2001; Taylor and Bain, 1999).

Others argue that mass production models are inappropriate for the production and

distribution of information. Consequently, a new paradigm of mass customisation is

being created, which demands a more skilled workforce, with analytical problem

solving, communication and computer skills (Frenkel et al, 1998, 1999; Korczinski,

2001, 2002). In particular, call centres are viewed as appropriate sites for the

development of high performance work systems, where the exercise of skill, and

commitment are rewarded with better jobs and performance related forms of

remuneration (Batt, 1999; 2000; 2002; Kinnie et al, 2000). Such work systems

dovetail with market segmentation strategies and in particular with relational as

opposed to transactional work with an organisation’s clients (Hutchinson et al, 2000).

While these debates continue, an even more recent phenomenon has been the business

process outsourcing (BPO) of call centre services to countries such as India. This

represents a true globalisation of info-service work, where transnational companies

outsource customer service work to agents in third countries. BPO is a direct result of

business process reengineering whereby firms decide on what activities to undertake

themselves based on their core competencies and outsource the rest, either by setting

up their own ‘captive’ centres offshore or enter into strategic agreements with third-

party business partners around the world to lower their transaction costs or improve

synergies (Thite, 2008). The third party service providers in turn may set up onshore,

near-shore or offshore centres depending on where they can maximise synergies

(Srivastava and Theodore, 2006). In the Indian info service context, these services

2
come under the umbrella of Information Technology Enabled Services (ITES) and

includes call centres, BPO and recently, knowledge process outsourcing (KPO) that

combines IT with knowledge embedded in software. This paper relates to Indian call

centres within the context of offshored ITES/BPO. In 2006-07, the Indian ITES/BPO

industry yielded an export revenue of US$8.4 billion at an annual growth rate of

33.5% and an employment base of nearly half a million (Nasscom, 2008).

Human resources are regarded as the key, sustainable and difficult to imitate

competitive advantage in any service sector. Therefore, attracting, developing,

retaining and engaging talent are crucial to the survival and growth of any service

oriented firm. This paper focuses on the strategic and operational aspects of human

resource management (HRM) in the Indian call centre/ BPO sector. We begin with the

macro analysis of key HR issues, challenges and strategies followed by an operational

overview. We then introduce our research methodology that taps into both managerial

and employee perspectives on certain key aspects of HR delivery, namely,

recruitment, training, remuneration, career management and occupational health and

safety. We then focus on two crucial outcomes of HRM, namely employee relations

and engagement. The paper concludes with a discussion of research findings and their

implications for HR theory and practice.

STRATEGIC HR ISSUES IN INDIAN CALL CENTRES

Many call centres focus on cost minimisation, measured by efficiency metrics, such as

call handling time and number of customers handled per employee. When this focus

translates to HR systems with low levels of employee training, employee discretion

and incentives, the likely result is high absenteeism and turnover (Deery, Iverson and

3
Walsh, 2002). The global call centre industry is therefore, often plagued by high

employee turnover and customer dissatisfaction (Batt and Moynihan, 2006). This is

more so with outsourced or offshore call centres where subcontractors are under

intense pressure to contain costs and are therefore, less likely to invest in employees

(Batt, Doellgast and Kwon, 2005; also see Batt et al.’s paper in this book).

The most widely accepted dimensions of service quality in call centres are: tangibles,

reliability, assurance that the customer has about the service, responsiveness to

customer demands and empathy towards the customer (Zeithaml, Parasuraman and

Berry, 1990). The latter three dimensions account for almost 60% of customer

satisfaction scores, and are primarily driven by the ability of employees to respond to

customers. In a survey of 64 US-based call centres, Batt and Moynihan (2006)

concluded that investment in HR systems, including training, employee discretion

oriented work designs and incentives lead to higher service quality and higher net

revenues per call. Another study of UK call centres indicated that affective

organisational commitment followed by job satisfaction had a significant impact on

service quality delivered (Malhotra and Mukherjee, 2004).

Many writers have characterised call centre work with dramatic labels, such as

‘electronic panopticons’ and ‘dark satanic mills of the 21st century’ (Fernie and

Metcalf, 1998; Garson, 1988). However, contrary to such stereotyped images,

employee well-being in call centres is found to be similar to that in other comparable

forms of work and is associated with effective job design, less intense and

development-oriented performance monitoring and supportive team leadership

(Holman, 2003; Holman, 2002). Similarly, Zapf et al. (2003) found that call centre

4
jobs, particularly, outbound activities, were less stressful with regard to job stressors,

thanks to better organisation and investment in information technologies.

Against this global backdrop, India provides a unique mix of strategic and operational

HR issues and challenges. In relation to its competitors (such as China, Israel, Ireland

and Eastern European countries), India enjoys an excellent climate for BPO

offshoring, underpinned by an educated and English-speaking labour pool, cheap

labour costs and government support (Mehta et al., 2006). BPO in India is a youthful

industry in more ways than one. The workforce is composed almost entirely of young

university graduates with an annual national supply of around 3 million/year. This

scenario has been a major selling feature for the industry. Young, highly educated and

ambitious cohorts are said to make for dedicated, committed professionals (D’Cruz &

Noronha, 2006; Noronha & D’Cruz, 2006), exactly the kinds of workers that

interactive customer service requires.

Yet, in spite of what could be taken as highly favourable conditions for selection,

recruitment and the further development of BPO, employee turnover, has quickly

become the number one challenge facing the burgeoning industry (Budhwar et al.,

2006). According to a global call centre report, Indian call centres have the highest

employee turnover of 40% against a global average of 20% and almost 60% of

employees have less than one year of tenure at work (Holman, Batt and Holtgrewe,

2007). Similarly, Wallace reports in her paper in this book that a comparative analysis

of call centres in the Asia Pacific region including China, India, Philippines,

Australia, Malaysia and Singapore reveals that while India had the second lowest

average full-time customer service agent annual salary (US$3334) behind China, it

5
had the greatest level of agent attrition (38%) and lowest average employee tenure (11

months).

Clearly, human resources are both the biggest strength of and challenge to Indian

BPO firms. At the strategic level, India will continue to reap the benefits of growth in

the outsourcing phenomenon, that now includes knowledge process outsourcing

(KPO), but will continue to struggle with rising costs, operational problems and

intense competition, squeezing its profit margins (Mehta et al., 2006; Thite and

Russell, 2007).

OPERATIONAL HR ISSUES IN INDIAN CALL CENTRES

The trends noted above have a number of implications for the delivery of HRM in the

call centre/BPO industry. First, it means that a great deal of HR activity is occupied

with the recruitment and selection function. This may have implications for

resourcing other elements of HR such as on-going training and career development.

Secondly, high turnover rates impact productivity and production costs. When a

significant proportion of the workforce is in learning mode, it is difficult for an

organisation to optimise productivity. Moreover, as workers become more

experienced, the costs of providing a unit of service should diminish. Although

service level agreements may reflect these assumptions, they are much more difficult

to attain when attrition rates are high. The current situation in BPO poses an intriguing

paradox. The competitive advantage that Indian BPO is thought to leverage is

premised upon low cost, but dedicated professional labour. But as we have seen,

turnover rates are not only high, but considerably above estimates of call centre

attrition in the West as well in the rest of the Asia Pacific region.

6
There is a distinct dichotomy in the way Indian call centre employees are portrayed in

the business and the HRM literature. The business press heaps praises on the service

quality, productivity, professionalism and high skills of Indian call centre agents

(Taylor and Bain, 2003), whereas researchers point to the difficulties and bitter

experiences these agents often face in servicing overseas clients, such as working on

mostly graveyard shifts, locational masking and having to assume westernised

pseudonyms (Mirchandani, in this volume ), which entails organisational control over

employee identity (D’Cruz and Noronha, 2006). The ill effects of extreme version of

the mass production model (Taylor and Bain, 2005), and physiological and

psychological ill-health (Ramesh, 2004) are also frequently cited outcomes. In service

jobs that involve emotional labour, work related factors, such as lack of autonomy,

length of tenure, working hours, workload and lack of variety can lead to emotional

exhaustion and absenteeism (Wharton, 1993; Deery, Iverson and Walsh, 2002). The

inherent negative characteristics of offshored call centre work with high performance

monitoring and low job discretion are said to contribute to employee dissatisfaction

and therefore, turnover (Batt, Doellgast, Kwon, Nopany and Nopany, 2005).

Indian BPOs exhibit formal, structured and rationalised HRM systems that include

tightly controlled structures with a customer focus, a strategic role played by the

HRM function and several employee involvement and commitment work practices

(Budhwar, Luthar and Bhatnagar, 2006 and Budhwar et al. in this volume). More

broadly, some researchers have suggested that call centres use HRM in ways that

combine job satisfaction with high levels of control in a “fun and surveillance”

complex (Kinnie, Hutchinson and Purcell, 2000). Other aspects of call centre HRM

7
such as strategic recruitment and selection (Callaghan and Thompson, 2002),

comprehensive training programs and secure employment may have the same effect

of merging low discretion work processes with high commitment HR practices,

although success (higher commitment, lower turnover) is not necessarily guaranteed

(Houlihan, 2002; Mulholland, 2002). In the domain of call centres, desirable HR

practices are said to consist of team work, relatively skilled work and incentivised

remuneration systems (Batt, 2000). Shah and Bandi (2003) report upon a similar

culture amongst the help desk call centre workers they studied. Training, continuous

learning, and progression to more challenging responsibilities at this case study site

lent an aura of true professional work to the activities undertaken at this BPO

provider. Another study among software professionals in India revealed that “HRM

practices such as an employee-friendly work environment, career development,

development-oriented appraisal, and comprehensive training show a significant

positive relationship with organisational commitment” (Paul and Anantharaman,

2004).

Employee engagement is a recent addition to the battery of HR outcome measures in

contemporary organisations, underpinned by a resource-based view of competitive

advantage within and between firms (Frank, Finnegan and Taylor, 2004). It is defined

as “employees’ willingness and ability to help their company succeed, largely by

providing discretionary effort on a sustained basis” (Towers Perrin, 2005). It involves

various aspects of employee contribution in not just meeting but exceeding the goals

by ‘going the extra mile’ through emotional and psychological engagement. A global

workforce study revealed that in India, only 7% of employees were highly engaged,

37% were moderately engaged and 56% were disengaged (Towers Perrin, 2005). A

8
study of employee engagement in Indian ITES employees found that employees

showed low levels of engagement at the beginning and at completion of 16 months

with the organisation but showed high engagement levels during the intermediate

stages, indicating limited retention potential of a good level of employee engagement

(Bhatnagar, 2007). In the light of high employee turnover in Indian call centres, it

would be worthwhile to ascertain employee perception on engagement measures, such

as knowledge sharing, concern for co-workers and attitudes to demands on work over

and above the normal workload.

METHODOLOGY

As aptly described by Batt et al. (2005), studies on Indian call centres are guided more

by “heated debate than systematic empirical investigation”. Many of these initial

studies were based on interviews with managers (Taylor and Bain, 2005; Batt et al.,

2005); however, some studies have emerged recently involving surveys/interviews

with field agents or customer service representatives (CSRs) (D’Cruz and Noronha,

2006; Budhwar, Varma, Singh and Dhar, 2006; Budhwar, Luthar and Bhatnagar,

2006). In the study reported here, we adopt a holistic approach to our research on

Indian call centres, firstly, by considering a wide range of work and employment

aspects both at macro and micro levels and secondly, by covering both managers and

employees. By capturing the ‘employee voice’, we are able to better evaluate the

effectiveness of HR measures, rather than relying on the managerial rhetoric, as is

often the case with studies mostly based on managerial interviews.

We began our research in mid-2005 by conducting preliminary interviews of Indian

call centre managers to better understand the realities of offshored call centre work

9
and to build a case for their participation. Based on this feedback, we fine tuned our

interview protocols and employee survey questionnaire to better reflect the unique

aspects of call centre employment. The Indian BPO industry is very reluctant to

provide access for data collection, particularly from employees, for a variety of

reasons, including political sensitivity surrounding outsourcing in Western countries,

confidentiality agreements with overseas clients and negative reports in the Indian

media about the ill-effects of call centre employment. Therefore, we adopted a case

study approach and managed to convince four large Indian BPO firms to participate in

the study by tapping into our personal, academic and industry networks. A total of 15

HR and operations managers participated in the interview sessions and 638 customer

service representatives (CSRs) took part in the survey.

The managerial interviews entailed the use of two protocols, one for the HR

management team and the other for the Operations management side of the business.

These sessions sought to elicit more detailed data on employee costs, work design,

recruitment challenges and general business profiles and relations with clients. The

interview sessions were held sometimes with one manager and sometimes with the

manager and other members of his/her team. Interview notes were taken at these

meetings and observer triangulation was employed for each session.

The employee survey contains five sections, composed of both Likert scale questions

and other close-ended queries that were developed by the authors specifically for the

Indian call centre/BPO sector. The sections include a general biographical section,

training (both initial and ongoing), career intentions, work organisation (pace and

intensity of work, performance monitoring, job discretion, work skill requirements),

10
workplace relations (work teams, social activities, discretionary behaviours) and

occupational health and safety (OHS). For the purpose of this paper, we cover

selected aspects of our data, namely, recruitment, training, career aspects, OHS,

employee relations and engagement.

Case Study Organisation and Employee Profile

All the four case study organisations in our study are indigenous third party providers

and 100% subsidiaries of some of the largest Indian IT companies. They provide front

and back office services to the customers of overseas’ clients. As BPO providers they

offer whatever information-enabled services (ITES) the principle client needs. If these

capabilities are not ready at hand, they will be developed in very short order through

strategic recruitment and hiring. This business logic dictates amongst other things:

the size of Indian customer contact operations; the internal structure of operations and

the design of work flows and jobs. By comparative standards, Indian BPO providers

can only be classified as large companies in their own right. Employment at the time

of our study at the four centres ranged from 1,700 to 12,500 CSRs. Workers are

employed across multiple sites, located in different cities, with the largest provider

occupying seven different facilities in five major cities.

Following on from their raison d’etre and their size is the multi-functional character of

operations. In the literature on call centres it is common to distinguish between in-

bound customer service and out-bound centres, as well as between front office

customer care and back office processing. The Indian operations include all of the

above within the notion of BPO. For example, amongst the companies included here,

one divided its workforce on a 40:40:20 basis between in-bound, out-bound and back

11
office work respectively. In another the workforce was split exactly in half between

voice services and back office work, while the largest company in the study classified

60 percent of its employees as call centre CSRs. In the remaining company, only 20

percent of its 5,300 workforce were involved in voice based call centre work. Once

again, the idea is to supply what ever services the foreign business client desires and

in the mix that is required.

Each of the companies examined here had numerous overseas clients and this adds to

the complexity of understanding the business model and how it works as compared to

the in-house contact centres that predominate in the West. Overseas business clients

cover a broad array of undertakings, including financial services (banking and

insurance), health care, telecommunications, internet service, and IT service/support.

Some companies try to leverage off of their parent companies’ expertise by offering

IT servicing as a speciality, while others do not privilege any particular sector and

take on business as it becomes available.

The business profiles associated with BPO activity also determine the internal

organisation of work. Teams are associated with specific clients and services.

Although team size is similar to in-house call centres in the West, (i.e. around 15

CSRs per team), the overall size of the centres and number of business principles

served makes for huge numbers of teams. For example, one of the companies included

here was organised around between 200 and 220 CSR process teams spread across

three sites. Clients and teams are equated to business processes and each process has

its own targets/kpi’s as agreed to with the principle in Service Level Agreements

(SLAs). This means that there are no common metrics in Indian contact centres; each

12
process/contract contains its own quantitative and qualitative targets as agreed to by

the principle and the BPO provider.

Our study covered 638 customer service representatives (CSRs), also known as

process executives. They had an average of xxx months of total call centre experience

and xxx months with the current employer. Only 28% of them had previous call

centre experience. 64% of them worked in an inbound call area, 16% in an outbound

area and 20% in both. 98% of them were full-time employees. In terms of gender,

61% of them were males. 92% of them were under 30 years of age and only 7% were

in the age group of 30 to 40. 83% were singles and never married. 90% of the CSRs

had a graduate qualification, of which 23% of were post-graduates.

RESULTS

Recruitment

In the managerial interviews, talent attraction was frequently quoted as one of the key

HR challenges facing the Indian call centre/BPO industry. The BPO industry took off

in India in 2002 and has been growing at double the rate of the IT industry since then

and therefore, has had less time to mature and manage scalability. During its initial

growth period, the recession in the IT industry augured well to attract talent for BPO

firms but since then, not only has the IT industry recovered but other sectors in the

Indian economy, such as leisure and recreation, aviation and infrastructure, started

showing strong growth resulting in a strong demand for talent and lower standards

applied during recruitment.

13
The managers stated that the main recruitment challenges for the call centre/BPO

industry include employability/ trainability of prospective employees as well as the

negative employment image and social stigma associated with the industry, in terms

of night shift working, work stress and monotonous and routinised work. For instance,

one of the firms covered in our study needed to recruit 300 CSRs every month but

found only 6 out of every 100 interviewees employable and 25% of its employee

turnover was involuntary arising out of employment terminations based on poor

performance. Moreover, 50% of voluntary turnover at this firm occurred in the first 90

days.1 In all of the firms in our study, marriage was one of the main reasons for

employee turnover as married employees, particularly women, found it difficult to

continue to work on night shifts. Call centre employment is not seen as a stable, long-

term, socially prestigious employment; rather it is viewed as an adhoc, low esteem

job.

In our study, 32% of the CSRs had obtained employment via an employment agency,

26% through newspaper/ internet advertisements, 19% via employee referrals and

18% had approached the employer on their own. Campus recruitment is growing as a

key means of recruitment (refer to Infosy’s paper in this book). In terms of the typical

recruitment process, the initial screening is done based on resumes. Graduates in any

discipline are preferred. Final selection is based on an aptitude test, group discussion

and personal interviews conducted by team leaders and HR. The process normally

takes one week. Once a candidate is rejected, he/she may be put on hold and not

allowed to appear for another test for 6 months. In the light of recent cases of

employee fraud, some firms conduct reference checks for integrity and criminal

record.2
1
Interview with Chief People Officer of a Bangalore based BPO firm dated 13 th Oct.., 2005

14
Training

The induction training is very important to the Indian call centre/ BPO firms as most

employees have no prior experience. Typically, it varies from 4 to 6 weeks. In one

firm, the induction training lasts for 8 weeks and is divided into pre-process, process

and nesting phases. The pre-process training involves communication and cultural

training for 2-3 weeks, followed by a product based process training for 4-6 weeks

and concludes with on-the-job training (nesting phase) for 3 weeks3. In another firm,

the initial training lasts 1 month and comprises voice, language and process training4.

According to the employee survey, 51% of respondents believed that the induction

training was equally divided between classroom and on the job training, mainly

conducted by in-house trainers (69%) and involved training on product knowledge

(42%), software/system training (16%), customer service (12%), quality process

(10%) and social skills (8%). Contrary to media reports, language training and inter-

cultural training constituted a small part of the training (8% and 3%, respectively).

Nearly 50% of employees stated that they received additional ongoing training and

that they could nominate themselves to receive additional training.

In terms of employee satisfaction with training, the response was very positive with

regard to the adequacy of training, efficiency of trainers, split between classroom and

on the job training and accessibility for additional training when required (Table 1).

2
Interview with Senior Manager –HRD of a Bangalore based BPO firm dated 17th Oct.., 2005.
3
Interview with General Manager – HR of a Bangalore based BPO firm dated 13 th Oct., 2005.
4
Interview with HR manager of a Hyderabad based firm dated 18th October, 2005.

15
Table 1: Employee Satisfaction with Training

Item Agree Disagree Neutral

The trainer(s) at this company 85% 6% 9%

do a good job
The split between classroom 69 12 17
and on-the-job training was
about right
The initial training that I 74 13 13
received at this company was
adequate for me to meet the
expectations of my job
I am given adequate training 74 10 13
when new products and services
are introduced
I can access additional training 63 10 17
if I don’t think I am adequately
responding to customer
questions

Remuneration/ Employee Costs

Managerial interviews revealed that the employment costs in the four firms covered in

our study varied between 60 to 70% of total costs. The typical breakdown of

employment costs was: 30% fixed salary, 15% incentive payments, 15%

transportation costs to and from home, 6-8% food vouchers and the remaining for full

or partially subsidised dormitory accommodation, recruitment and training costs and

technology expenses.

The employee survey contained limited items on remuneration and rewards.

Employees indicated that satisfaction with wages was the “most important reason” for

them to stay in the job and conversely, to leave the job (see the next section). This

clearly indicates the importance of remuneration in motivating employees. Further,

78% of employees in our survey indicated that ‘any performance bonuses that I

16
receive at this call centre are important to me’ and also 54% of them wished that they

had more performance competitions.

Career Management

Our research questions under this section included performance management

processes, career pathing and progression. In one of the firms covered in our study,

“Performance appraisal is conducted every 6 months while job level feedback

is given every month. 360-degree feedback is obtained for senior people. Bell

curve is applied to the evaluation process and each employee is provided with

individual rating as well as comparative rating. Appraisal feeds into

identification of training needs drawing up a training plan. Appraisal is used

for promotions, variable pay and increments. Balanced scorecard methodology

is followed by incorporating team goals”.5

According to HR managers, career pathing is a very important challenge in terms of

employee retention. Most companies in the industry promote from within but

obviously there is a limit to the number of employees who could be promoted to team

leader positions and above. The managers found it frustrating that many employees

expected promotion based on tenure and believed that promotion meant no more

telephone handling and only supervision. In the words of one manager, “the BPO

industry lacks the flexibility of IT industry in providing job enrichment, job

enlargement, job rotation and task variety as motivational measures”.6 In one firm,

horizontal movement across processes and clients was one way to address monotony

on the job.7 From the managerial point of view, the main problem with employee

17
retention is that call centre employment is not seen as a career. Going up the value

chain is seen as one way to engage and retain employees. However, specialist call

centre services in data mining, accountancy, equity research and other specialized

services require special domain knowledge and expertise and are out of bounds for

generalists which most CSRs are.8

When asked ‘whether you see yourself staying in your current job for the next 3

years’, 38% of employees said, yes; 26% said, no and 36% were unsure. Combining

yes and unsure responses, the potential employee turnover amounts to 60% over 3

years. When asked to nominate the “most important factor in their decision to stay in

their job”, 27 percent of employees nominated satisfaction with wages, 20 percent

enjoyment of the work, and 17 percent chances for advancement. These were

followed by workers who suggested employment security (13%), lack of other career

opportunities (8%), flexible working hours (7%), fair treatment from management

(5%) and friendships at work (4%) as the most important reason for staying.

Similarly, when asked ‘what is the most important factor that might motivate you to

look for other career options’, not surprisingly, dissatisfaction with wages topped the

list (39%) followed by lack of chances for advancement (22%) and the routine/boring

nature of job (7%).

Occupational Health and Safety (OHS)

According to our employee survey, at the end of a working day, 34% employees felt

‘quite tired or drained’, 41% felt ‘moderately tired’ and 25% felt ‘not particularly

tired’. Workers characterised this tiredness equally between physical fatigue and

mental/emotional tiredness. When asked ‘whether you ever suffer from stress or

18
symptoms of stress that are induced by your work situation’, 45% said yes, 38% said,

no and 18% were unsure. In terms of ‘three most important sources of stress’,

employees nominated performance targets (29%), working during odd hours (21%)

and call volumes (16%). The only other notable stressor was ‘repetitive work’ (13%).

As illustrated in Table 2, in regard to the various aspects of emotional labour attached

with their jobs, only a minority felt depressed (19%), had no desire to talk to others at

the end of the shift (25%), and considered their job as important to their emotional

well-being (41%). On the physical aspects of their work environments, employees

were happy with the noise levels and the standard of equipment used but only 46%

felt that management considered OHS as a priority.

Table 2: Occupational Health and Safety

Item Agree Disagree Neutral

This job leaves me feeling 19 46 30

depressed
My work area is very noisy 17 41.5 23
making it hard to listen to
callers
My workstation and the 61 16 20
equipment I use is of a high
standard
At the end of my shift, I don’t 25 51 22
feel like talking to anyone
This job is important to my 41 17 34
emotional well-being.
Occupational health and safety 46 20 30
takes priority with
management at this call centre

5
Interview with Senior Manager – HRD of a Bangalore based BPO firm dated 17th Oct., 2005
6
Interview with Senior Manager, Talent Engagement & Development, Pune branch dated 27 th June,
2005.
7
Interview with HR manager of a Hyderabad based firm dated 18th October, 2005
8
Interview with Senior Vice President – HR of a Bangalore based BPO firm dated 22 nd July, 2005.

19
Employee Relations

In this section, we probed employees about the quality of their relationship with their

employer in terms of trust and recognition and representation of employee voice.

Normally trade unions are a potent symbol of employee voice in the workplace, as is

generally the case with the call centres in the West; however, when asked whether

there was a trade union representation in their work place, 74% of employees said, no

and only 30% believed that there ‘should be one’. However, as can be seen from

Table 3, employees do not necessarily trust the organisation and believe that there

tends to be a ‘us’ and ‘them’ relationship between labour and management.

20
Table 3: Employee Relations

Item Agree Disagree Neutral

This organisation recognises 48% 20% 28%

and rewards employee loyalty
Management has problems 23 41 31
trusting its employees at this
call centre
There tends to be an ‘us’ and 35 26 33
‘them’ relationship between
employees and managers at
this organisation
Employees can trust this 49 17 31
organisation to do what’s right
by them
The likelihood of lay off or 32 22 36
retrenchment at this call centre
is high

21
In the absence of a union, a majority of employees rely more on taking their work

related problem to their team leader for consultation. Further, in the face of acute

employee retention problems, employers try various means to identify and address

employee grievances, including frequent town hall style meetings. One of the firms

covered in our study set up an “Employee Advocate Group” run by operations

personnel in close collaboration with the HR department.9 The purpose is to flesh out

floor level issues by people who have risen from the ranks. This also facilitates career

enrichment for CSRs with aptitude for people management

Employee Engagement

On various measures of employee engagement, including concern for co-workers,

sharing of knowledge, working extra hours and staying late at work without additional

payment as well as in terms of commitment to organisational goals and looking

forward to coming to work, employee responses are quite positive, as can be seen

from Table 4.

Table 4: Employee Engagement

Item Agree Disagree Neutral

If I am absent from work, I 64% 12% 22%

become concerned about the
effects this will have on other
members of my team
If you see a way in which your  Keep that knowledge to
job could be done more yourself : 4%
efficiently, would you …  Share it with a co-worker:
(Circle only one response) 59%
 Show your supervisor: 36%
If I was asked to work extra 50 28 21
hours after my normal shift at
9
Interview with Manager – Talent Engagement & Development, Delhi branch dated 21 st Oct., 2005.

References

22
my usual rate of pay in order
to help out the organisation, I
would generally agree to do
so.
I don’t mind staying late at 57 19 15
work after the end of my shift
in order to complete a call or
post-call work.
I strongly identify with the 75 5 18
mission and values of this

Bain, P., Watson, A., Mulvey, G., Taylor, P., and Gall, G. 2002. ‘Taylorism, targets
and the pursuit of quantity and quality by call centre management’, New Technology,
Work and Employment, 17: 170-185.

Batt, R. 1999. ‘Work organization, technology and performance in customer service

and sales’, Industrial and Labor Relations Review, 52: 539-564.

_______ 2000. ‘Strategic segmentation in front line services: Matching customers,

employees and human resource management systems’ International Journal of
Human Resource Management, 11: 540-561.

________ 2002. ‘Managing customer services: human resource practices, quit rates
and sales growth’, Academy of Management Journal, 45: 587-597.

Batt, R., and Moynihan, L. 2002. ‘The viability of alternate call centre production
models’. Human Resource Management Journal, 12(4): 14-34.

Batt, R., Doellgast, V. and Kwon, H. 2005a. ‘Service management and employment
systems in U.S. and Indian call centres’, in S. Collins and L. Brainard (Eds),
Offshoring White-Collar Work, Washington, D. C.: Brookings Institute.

Batt, R., Doellgast, V., Kwon, H., Nopany, M. and Nopany, P. 2005b. ‘The Indian
call centre industry: National benchmarking report. Strategy, HR practices &
performance’. Ithaca, New York: Cornell University.

Batt, R. and L. M. Moynihan. 2006. ‘Human resource management, service quality,

and economic performance in call centres’. Working paer series #06-01. Ithaca, NY,
Cornell University, School of Industrial and Labor Relations, Center for Advanced
Human Resource Studies.

Belt, V. and Richardson, R. et al. 1999. ‘Smiling down the phone: women's work in
telephone call centres’, Workshop on telephone call centres, London School of
Economics.

Bhatnagar, J. 2007. ‘Talent management strategy of employee engagement in Indian

ITES employees: key to retention’, Employee Relations, 29(6): 640-663.

23
organisation.
Working for this organisation 63 12 22
provides me with an important
sense of who I am.
I usually look forward to 61 13 24
coming into work.

Budhwar, P., Varma, A., Singh, V., & Dhar, R. 2006-a. ‘HRM systems of Indian call
centres: an exploratory study’, International Journal of Human Resource
Management, 17(5): 881-897.

Budhwar, P., Luthar, H. K., & Bhatnagar, J. 2006-b. ‘The dynamics of HRM systems
in Indian BPO firms’, Journal of Labor Research, 27(3): 339-360.

Callaghan, G. and Thompson, P. 2001. ‘Edwards revisited: Technical control and call
centres’. Economic and Industrial Democracy, 22: 13-37.
Callaghan, G. and Thompson, P. 2002. ‘”We recruit attitude”: the selections and
shaping of routine call centre labour’, Journal of Management Studies, 39(2): 233-
254.

D'Cruz, P. and Noronha, E. 2006. ‘Being professional: Organisational control in

Indian call centres’, Social Science Computer Review, 24(3): 342-361.

Deery, S., Iverson, R. and Walsh, J. 2002. ‘Work relations in telephone call centres:
Understanding emotional exhaustion and employee withdrawal’, Journal of
Management Studies, 39(4): 471-496.

Fernie, S. and D. Metcalf. 1998. ‘(Not) hanging on the telephone: payment systems in
the new sweatshops’, Centrepiece, 3: 7-11.

Frank, F. D., Finnegan, R. P. and Taylor, C. R. 2004. ‘The race for talent: Retaining
and engaging workers in the 21st century’, Human Resource Planning, 27(3), 12-25.

Frenkel, S., Korczynski, M., Shire, K. & Tam, M. 1999. On the Front Line:
Organization of Work in the Information Economy. Ithaca, NY: Cornell University
IRL Press.

Frenkel, S., Tam, M., Korczynski, M. and Shire, K. 1998. ‘Beyond Bureaucracy?
Work Organization in Call Centres’, International Journal of Human Resource
Management, 9: 957-79.

Garson, B. 1988. The electronic sweatshops: how computers are transforming the
office of the future into the factory of the past. New York: Simon and Schuster.

Holman, D. 2002. ‘Employee wellbeing in call centres’, Human Resource

Management Journal, 12(4): 35-50.

24
DISCUSSION

An evaluation of the HRM function within Indian call centres/BPO needs to be

grounded in the global realities of call centres in general. The global call centre

industry is hardly 10 years old, whereas the BPO part of the industry is half that age.

The business landscape in terms of service offerings, information and communication

technologies, competitive strategies and synergies are constantly changing, throwing

-------- 2003. ‘Phoning in sick? An overview of employee stress in call centres’,

Leadership and Organization Development Journal, 24(3): 123-130.

Holman, D., Batt, R. and Holtgrewe, U. 2007. The global call centre report:
International perspectives on management and employment. Report of the global call
centre network (US format). Accessed on 2nd Jan, 2008.
http://www.ilr.cornell.edu/globalcallcenter/upload/GCC-Intl-Rept-US-Version.pdf

Houlihan, M. 2002. ‘Tensions and variations in call centre management strategies’,

Human Resource Management Journal, 12(4), 67-85.

Hutchinson, S., Purcell, J. and Kinnie, N. 2000. ‘Evolving high commitment

management and the experience of the RAC call centre’, Human Resource
Management Journal, 10(1): 63-78.

Kinnie, N., Hutchinson, S., and Purcell, J. 2000. ‘Fun and surveillance': The paradox
of high commitment management in call centres’, International Journal of Human
Resource Management, 11(5): 967-985.

Korczynski, M. 2002. Human Resource Management in Service Work. Houndmills:

Palgrave.

Korczynski, M. 2001. ‘The Contradiction of Service Work: Call Centre as Customer-

oriented Bureaucracy’, in A. Sturdy, I. Grugulis & H. Willmott, (eds.) Customer
Service: Empowerment and Entrapment. Houndmills: Palgrave.

Lovelock, C. 2005. Services marketing: People, technology, strategy. New Jersey:

Prentice Hall.

Malhotra, N. and A. Mukherjee. 2004. ‘The relative influence of organisational

commitment and job satisfaction on service quality of customer-contact employees in
banking call centres’, The Journal of Services Marketing, 18(2/3): 162-174.

Mehta, A., Armenakis, A., Mehta, N., and Irani, F. 2006. ‘Challenges and
opportunities of business process outsourcing in India’, Journal of Labor Research,
27(3): 323-338.

25
new challenges to researchers struggling to get a grip on the industry. The nature of

work in this industry is often characterised by routinised work flows and monotony

within a stressful work environment leading to relatively high employment turnover.

Against this global backdrop, the results of our study show several positives in the

way HRM is conducted and delivered in the Indian call centre/BPO industry. For
Mirchandani, K. 2003. Making Americans: Transnational call centre work in India.
Unpublished paper.

Mulholland, K. 2002. ‘Gender, emotional labour and teamworking in a call centre’,

Personnel Review, 31(3): 283-303.

Nasscom. 2008. Indian ITES-BPO industry – fact sheet. New Delhi: National
Association of Software and Service Companies.

Noronha, E. and D'Cruz, P. 2006. ‘Organising call centre agents: Emerging issues’,
Economic and Political Weekly, pp.2115-2121. May 21-27, 2006.

Paul, A.K. and Anantharaman, R.N. 2004. ‘Influence of HRM practices on

organisational commitment: A study among software professionals in India’, Human
Resource Development Quarterly, 15(1): 77-88.

Ramesh, B. P. 2004. ‘Cyber coolies' in BPO: Insecurities and vulnerabilities of non-

standard work’, Economic and Political Weekly, pp.492-497. January 31, 2004.

Russell, B. 2004. ‘Are all call centres the same?’, Labour and Industry, 14: 91-109.

Shah, V. and Band, R. 2003. ‘Capability development in knowledge intensive IT

enabled services’, European Journal of Work and Organizational Psychology, 12(4):
418-427.

Taylor, P. and Bain, P. 1999. ‘An assembly line in the head’: Work and employee
relations in the call centre’, Industrial Relations Journal, 30: 101-117.

Taylor, P. and Bain, P. 2003. Call centre outsourcing to India: The revenge of
history? Call centre research. New Castle, Australia, University of New Castle.

Taylor, P. and Bain, P. 2004. ‘Call centre outsourcing to India: The revenge of
history?’, Labour and Industry, 14(3): 15-38.

Taylor, P. and. Bain, P. 2005. 'India calling to the far away towns': the call centre
labour process and globalisation’, Work, employment and society, 19(2): 261-282.

Taylor, P. and Bain, P. 2006. ‘Work organisation and employee relations in Indian
call centres’, in J. Burgess and J. Connell (Eds.), Developments in the call centre

26
example, the quality of training, the standard of technologies and the adoption of

several progressive HR practices are world class in the large info service providers.

However, despite the supply of a large, educated labour force with a proven core

competency in information technology, the ‘employability’ of people wanting to enter

the industry is a major challenge. In the context of the Indian BPO industry, the

opportunities for gainful employment provided by the industry for fresh graduates

leads to a strong work and organisational commitment in the short term. However, a

perceived lack of career advancement in the call centre industry coupled with routine,

monotonous, graveyard shift jobs motivates employees to jump from one job to

another looking for short-term gains, such as higher salaries, despite general working

conditions and career prospects remaining almost the same. Even though our study

reports arguably high levels of employee engagement, the same employees are

leaving in big numbers, thus eroding the value of HR’s contribution. Improving

industry. Abingdon, OX: Routledge.

Thite, M. 2008. ‘Business Process Outsourcing Management Issues’, in C. Wankel

(ed.), The Handbook of 21st Century Management. Thousand Oaks, CA: Sage.

Thite, M. and Russell, B. 2007. ‘India & Business Process Outsourcing’, in J. Burgess
and J.Connell (eds.), Globalisation & Work in Asia. Oxford: Chandos Publishing.

Towers Perrin. 2006. ‘Winning strategies for a global workforce’, Towers Perrin
global workforce study. Accessed on 15th Feb., 2008 at
http://www.towersperrin.com/tp/getwebcachedoc?webc=HRS/USA/2006/200602/
GWS.pdf

Wharton, A. S. 1993. ‘The affective consequences of service work’, Work and

Occupations, 20: 205-232.

Zapf, D., Isic, A., Bechtoldt, M. and Blau, P. 2003. ‘What is typical for call centre
jobs? Job charecteristics and service interactions in different call centres’, European
Journal of Work and Organizational Psychology, 12(4): 311-340.

Zeithaml, V., A. Parasuraman, et al. 1990. Delivering quality service: Balancing

customer perceptions and expectations. New York, Free Press.

27
employment branding and facilitating career advancement are major challenges faced

by HR professionals.

Just as the nature and extent of India’s role in the global information services sector is

often underestimated, the competency, capability and motivation of human resources

in India are also often exaggerated. While our study identifies the existence and extent

of many elements of strategic HRM, it also highlights that these positive aspects of

HRM have little effect on the very high employee turnover. Our findings have a

number of implications for both the management of contact services especially in an

offshore environment and for the broader connections that are made between

employee commitment and turnover in the HR literature.

Coupled with escalating wage costs, the competitive advantage enjoyed by the Indian

info service providers takes a beating with the emergence of other low cost countries,

such as China and Philippines. By moving up the value chain and entering into

knowledge process outsourcing, many of the large BPO firms that are set up by the IT

majors in India have managed to retain their competitive positioning, at least in the

short to medium term; however, this seems to have had limited impact on the long

term career prospects of employees. To move up the career ladder, BPO employees

need specialist domain knowledge and therefore, several progressive employers offer

tuition reimbursement and flexible work arrangements. These career development

measures need to be broadened and strengthened. Where workers are satisfied with

the opportunities to use their qualifications and with the prospects for further

professional advancement they are less likely to consider leaving their employment.

This holds true even in the context of favourable labour market conditions.

28
With regard to the operational aspects of HRM, where HR is preoccupied with high

maintenance and administrative activities (such as, constant and large scale

recruitment, training and performance appraisal), there is little time for strategic

thinking, planning and implementation. For example, rather than addressing employee

attrition solely by additional recruitment, HR professionals need to pay close attention

to the nature, types and causes of attrition at various levels, by drilling down data

from exit interviews and employee satisfaction surveys, to see where excess bleeding

is occurring and why, so that proactive HR measures can be taken to prevent the

problem.

One of the major limitations of our study is that it did not cover the captives set up by

Western multinational corporations where the employee turnover is reported to be

lower; however, it has been recently reported in the business press that many of the

captives are being sold to indigenous providers as they face increasing wage costs and

decreasing core competency. Other limitations of our study include lack of breadth

across various types and sizes of the BPO industry and an inability to conduct on-site

field research that could have unearthed broader and deeper employment issues.

The main contribution of our study lies in the capturing of employee voice in

understanding and evaluating HR practices and outcomes on a scale and canvas not

covered in previous studies. However, the fast changing business scenario in the

global info services sector means that we are chasing a moving target, limiting the

contextual applicability of any critical analysis to the time period, location, size and

type of organisations.

29
30