E SERVE: Not Just Vanilla Stakes

The cynical wink be dammed. Remote corporate services, known more popularly
but a little less appropriately as IT-enabled services in India, seem to be a
godsend for the downturn ridden software services industry here. Not
surprisingly, the beeline comprises the who’s who of our home-grown global
giants in software–TCS, Wipro, Satyam, HCL and Infosys.

But doesn’t it look a little odd that IT companies will provide services
like customer service and accounting? Do they have the aptitude for it? This is
the question that many in the US–the prime market for these services–asked
not long time ago. Looks like most of their doubts have been answered by now.
Now, optimists go as far as saying that these companies will be redefining the
remote services business. So the next million-dollar question that non-believers
ask: can they succeed? Well, didn’t they–by taking the services route to the
big league? And this time, the best part is that they are ready to explore
radically diverse strategies.

Allan Hall, director, Appllo’s Call center at Belfast, at E-Serve’s call center at Noida

A couple of months ago, Wipro had adopted a strategy quite different from the
rest. This time around, it’s HCL’s turn. E Serve Technologies Ltd, the
remote services (BPO) subsidiary of HCL Technologies, has come out with big, and
completely different plans. And it’s not just about acquiring existing call
centre businesses. HCL seems more keen to acquire some learning from the
existing companies. Look at the first major acquisition it did of the well-known
Apollo offshore call center in Belfast, Northen Ireland, which it bought from
British Telecom.

"Some of the challenges that India is facing now are quite familiar to
us," Alan Hall, director, Apollo’s call centre at Belfast, says. "By
integrating our processes between HCL’s Noida remote services centre and the
Belfast centre, there will be tremendous learning for both," he points out.

"However, it’s not just about learning," Hall opines. "The
most important reason behind the acquisition strategy, of course, is to acquire
customers. In this business, customer confidence is extremely important. And it
takes time to build a loyal base. With the acquisition, HCL has ensured that
existing customers of Apollo can choose to keep their services at Belfast and
later, if they want, can shift to Noida."

That E Serve’s primary objective is to attain customers is evident from the
fact that it is actively seeking to acquire a few more such companies in the US.
According to Sujit Baksi, CEO, E Serve, the company is in talks with some US
companies for acquisition. Unlike a few other Indian companies, like Spectramind
(in which Wipro has invested), E Serve is not averse to even partner with big
US-based call centres to get some of their jobs to India. In fact, the market
grapevine is that E Serve is talking to one of the top five call centre
companies in the US. And, if the grapevine is to be believed, E Serve is hunting
for acquisitions not just in the US, but also in Japan, Philippines, and Canada.
While India and Philippines are cost-effective places, the US companies and
Japanese companies can bring with them a ready client portfolio.

However, a few questions remain. Once the recovery in its core software
business, will HCL still want to grow its remote services arm? A more pertinent
question would be: is the slowdown span a good enough time for an IT services
company to completely redefine its outsourcing business? And post-slowdown, can
HCL, which is heavily relying on a full-acquisition model, sustain the remote
services business? Especially when it has chosen to address this business
through a subsidiary instead of making it part of its IT services portfolio?

Shyamanuja Das