Nagpur Spanco BPO - City on radar for Spanco BPO - IT bigwigs unsure

Spanco BPO Ventures, the outsourcing arm of Spanco Limited which has taken up power distribution in parts of the city, also has Nagpur on the radar as its scouting for destinations to start a 500-seat BPO unit. However, this cannot be seen as advent of BPO culture in the city, because many bigwigs in the industry still wary of considering the city as a suitable BPO destination.

Spanco which has its BPOs in five cities, Chandigarh, Dehradun, Coimbatore and Mysore is planning to add one more. Director of the BPO arm, Kaustubh Dhavse said a separate city will be preferred to maintain a comparative advantage in terms of cost. A presence in more cities ensures a choice for keeping the cost low. Although the destinations are still being evaluated with Nasik also being considered seriously, said Dhavse.

A domestic BPO, it would mainly cater to the telecom and banking security finance and insurance ( BFSI) sector. Initially to have a 200 seat capacity it is planned to expand to 500 within 18 months. This means job creation to the tune of 1,500, considering all the three shifts for which the BPO will run he said.

However, even as realtors and other business lobbies have been pushing Nagpur as an IT destination, the major players in this sector are yet to zero in on the city as an ideal BPO destination. Pravin Kamath the global head of Wipro BPO, said the company does not find enough manpower generating capacity in Nagpur. "Although we have been recruiting personnel in Nagpur to be posted elsewhere, the city does not generate enough numbers to sustain a BPO on its own," he said

K Raghanvan who heads the BPO recruitment in Infosys also said that generating enough local recruitment is one of the major considerations for selecting a BPO destination. As far as Nagpur is considered the company needs to conduct a further study, he said adding that it needs to generate a critical mass to start a BPO.

According to Rajiv Vaishnav, the vice-president of Nasscom, with smaller cities emerging as alternative destinations for BPOs and other IT units, there is a stiff competition among them in terms of offering a low cost option. The industry defines cities into four categories in terms of size. These are metros, tier I, tier 2 and 3. Nagpur is in the third category. So it will have to also compete with bigger cities, in terms of infrastructure and those smaller, in terms of cost. Operating a BPO in tier 2 city costs 30% less than a metro, but a tier 3 city makes it cheaper by 35%. Metros and Tier 1 cities have a gap of 25-30%. Cities of Tier 3 level are also eyeing a place in the IT map, said Vaishnav.

Reliance' Animation is planning to start a training centre under the Reliance BIG AIIMS chain. To be started in a month's time, the centre will offer training to build a career in the animation business, said the company's CEO Ashish S K. It will have a capacity of around 200 students, the other centres are in Pune, Delhi, Kolkata and Chennai.