Fast Changing Pricing Models and their Impact on BPO Operations

Indian BPO companies are betting big on a new way of providing BPO and other services.

Infosys is planning a number of cloud computing offerings. They had developed the techhnology for some of their clients and they are making them multi-tenant and pay-as-you-go kind of pricing.

TCS has similar offerings even on their web site.

It all seem to have started around the onset of the global recession a couple of years ago. First, they had cancellations and pricing pressures. Then they had pressures from clients on paying only for what they used instead of an FTE kind of pricing they used to have before.

Now the top Indian BPO providers seem to have taken the lead in changing the industry themselves and it looks promising for their longer term futures, recession or no recession!

This is a very good value-add that will be a win-win for clients, as well as providers in the long run.

First, Indian service providers can truly break out of the low cost labor model and move into a global trend - and for the client, hosted services mean no hardware, software and product updates. and lower fixed costs. It turns fixed costs into variable costs for them.

Strategically for the Indian service providers, this is tapping into a leapfrogging kind of service. With scale comes the ability of handling these on a global scale. That kind of ability will be truly value added and makes these providers, a new kind of global competitor to the likes of Accenture and IBM.

It will be interesting to see their responses also to these kinds of developments!