"The Gurgaon center is the single largest call center for Convergys"

Convergys, the world’s largest contact center, will be hiring 20,000 people
in India by 2007. The company began its operations in the country in Gurgaon in
2001 and already has 3,500 employees. By the end of this year, that number is
expected to grow to 6,500. John C Freker, president, customer management group,
Convergys, tells more …

After
Gurgaon, it’s Bangalore? What are your plans?

We are in a major ramp-up phase. The company started with 600 seats a little
over a year ago and is expected to ramp up to 4,000 seats across India by
year-end. On a thumb rule basis, each seat can account for two employees in two
shifts. As of now, the company has two sites. The one in Gurgaon has 3,125
people to date. The second one in Bangalore has 380 people. By the end of this
year, the employee strength is expected to grow to 6,500. We have invested in
200,000 sq ft of space in Gurgaon and 170,000 sq ft of space in Bangalore with
seat capacities of 1,900 and 1,600 plus respectively. We plan to start two more
new facilities by early 2004. We are looking at several options. The choice
could be around areas like Delhi (which still has lot of room for growth) and
other major cities with large English speaking populations. These would however
be smaller, housing about 700—1,000 seat sites.

The Gurgaon center is the single largest call center for Convergys, globally–in
terms of size, seats, and capacity.

How different is your model?

We came into the market considering how we would enter it. Should we partner
with someone, buy someone… We saw that no one is doing what we know as a
successful model, i.e., building efficiently around large space call centers
that allow us, maybe even for a single client, 4,000 employees on the same floor
and doing same type of work.

Our investment is our people. We invest about 33 percent more in training
than the typical outsourced call center companies.

The real differentiator for us is career expansion. About 70 percent of our
management started at the first level within the company and we have strong
commitment to culture. Today, the career expansion could happen in the US, the
UK, the Philippines, and in other places.

The differentiators are almost innumerable. We invest almost $110 million in
R&D annually out of the total revenues of $2.3 billion. This investment
number is bigger than most of our competitors. In terms of retention rate, we
have the highest retention rate in the industry across all ranks. The average
V-P has remained with us for 11 years, the average director 10 years, the
average manager five years, the average supervisor/team leader for
two-and-a-half years, and the average tenure for reps on the phones is a
year-and-a-half.

How do you comprehend the attrition scenario?

It ranges, depending on the complexity of the project. Across the
organization, outside of the training period, it is less than 50 percent. Across
the global organization it will range between 50 and 100 percent, if you include
the States. This is an industry where most of the industry faces more than 100
percent attrition. Most of the competitors in this business have 140—150
percent attrition. The UK would be in the 50—60 percent range. In India, over
the long run, it would be less than 50 percent. It is a funny number now because
there is a lot of ramp up now and 70 percent of the attrition happens within the
first 90 days.

What is your service mix?

Almost all our business is voice. Less than 10 percent is data. Over a
couple of years, we have perfected the accent, the mutualization, the
culturalization, etc. We are just trying to improve the understandability of the
accent. In the States, about a third of our business is tech support and in
India too it is about the same.

Technology changes, but fundamentally the business is about keeping costs
down. Is there a next step for doing it?

There are many things. Speech recognition is one. We bought a speech
recognition/IVR company (I-Basis) in June last year. Simple arithmetic says that
if the cost in the US to take a call is x for the customer, it is 50 percent of
x in India and with automation this drops to a tenth of x in the US. The big
savings are going to count in automation. Speech recognition is beginning to get
perfected. It is certainly not perfected to every dialect, every language. In
future, we see a combination of solutions. We see somewhere around 20—25
percent of the minutes of the conversation being automated in some form. Two
years ago about 20 percent of the customers were asking for automation in the
offshore component, but today, almost 100 percent are asking for it.

Ch Srinivas Rao