The Axe Falls on Wipro Again

There was one event in March that made every self-respecting BPO provider in

India sit up and take notice. US-based Capital One Financial Services, a Fortune

500 company, cancelled its outsourcing contract pertaining to outbound credit

card sales with one of the biggest third-party BPO service providers in India,

Wipro Spectramind. Capital One cancelled the contract citing ‘quality issues’

with the work done by the company’s call center agents. This comprises the

second client in three months to have cancelled a part of their outsourcing work

to the company.

When Wipro conducted an internal audit on the Capital One outbound project,

it discovered that certain aspects were not in keeping with their standards and

practices. According to the company, they proactively shared their findings with

their client, following which Capital One is supposed to have terminated the

outbound telemarketing contract with Wipro Spectramind. However, the BPO is

supposed to continue handling the inbound traffic of Capital One in their

centers in Navi Mumbai and Delhi.

Less than 10% of the 250 people who were part of the Capital One project will

be displaced though, according to Wipro, they were not fired. Most voluntarily

resigned when they were told that they would have to measure up to the standards

required or leave. No reliable information was available on the exact nature of

quality lapses.

This follows uncomfortably close on the heels of Dell’s controversial

pullout of its tech support functions from its Indian center and the

cancellation of the Lehman Brothers Holdings IT services outsourcing contract

with homegrown Wipro. Put together, the events seem to portend and add weight to

the growing belief that outsourcing might not be the biggest problem facing the

Indian BPO service provider. It adds another question mark to whether Indian

call centers are really delivering the goods that its overseas customers need.

And, aren’t these ominous rumblings of the potential avalanche getting too

close for comfort for the country’s service providers to continue ignoring and

giving out placatory noises even as they lose clients?

Sathya Mithra Ashok in Bangalore