Sukshm Information Services Pivots from Market Research Firm to Rural BPO
We interviewed Kushagra Bhatia, co-founder, Sukshm Information Services, in 2011. Then, a market research firm, Kushagra had highlighted his ideas and had said that, “We aim to bring information at the doorstep of our clients at a low price. We employ and groom rural candidates wherever possible as part of our initiate to empower rural folks and bring cost advantages.” Although, today, his firm has pivoted from market research to BPO, the basic idea about empowering rural youth stays the same.
This time we got in touch with him to know about the successful pivot of Sukshm Information Services Pvt Ltd. The firm is currently lead by a team of four likeminded individuals striving to add value to the society: Dr. S.S. Khanna, a renowned veteran, he had been the Advisor to the Planning Commission of India and handled various leadership positions with the Government of India, Vishisht Bhatia, a telecom engineer, recognized by Mahindra Rise for the immense commercial and social potential in his “Rural BPO” project, Antriksh, a Cost Accountant (CMA) and well versed in finance. He worked in Wipro BPO as a Team Coach for around 3 years, and Kushagra, with a post graduate in Marketing Management. He has been in BPO sector for more than 10 years.
YS: Tell us something about your current business.
KB: We are an ITES organization providing backend services like content management, customer services, forum moderation, data entry, XML tagging, etc. Sookshm Information Services Pvt. Ltd. (formerly Sukshm Information Services) is proving services to some of the biggest e-commerce companies in India, at a very cost effective rate. We pass on a chunk of cost savings to the clients. We are not only saving costs but also helping our clients in revenue generation in some projects. What differentiates us from our competitors is that we provide some of the high end services as listed above which almost none of the Rural BPOs provide.
YS: What prompted you to make the decision of pivoting?
KB: Like we mentioned earlier, Rural BPO was on our mind right from the start. First assignment did have a part of back office work like data entry. It helped us to learn more about rural areas and the work. All the founders belong to rural areas. We had the insights into the operations of a Rural BPO through our BPO experience, the knowledge that we could gather and the visits we made to other centers. With the projects coming in, it was an easy decision to make.
YS: You began as a market research firm, now you’re a rural BPO, how did you successfully pivot?
KB: The central idea of the founding team has always been to work in the rural areas, utilize the talent there. We had Rural BPO in mind right from the start. First business opportunity that came to us was to get involved in the Restructured-Accelerated power development and Reform Program (R-APDRP) commissioned under the XI Five year plans of the Government of India. That involved utilizing Rural Talent. Once the assignment was completed, we set out looking for opportunities in the BPO space. The team has a lot of BPO operations experience and worked hard at securing the projects that we now have. The first project did give us a lot of learning, though it was different from what we had in mind.
YS: How did you go about setting up things? Is doing business in rural regions a hindrance/benefit?
KB: As we are from the rural areas, it was not really that difficult for us to set things up. For most of the things, we knew beforehand that what could be the potential bottlenecks and how to go about them. Doing business in rural areas has its own benefits like cost, dedicated work force, nearly zero attrition etc. but finding solutions to the infrastructure, internet connectivity etc. takes a lot of deliberation. We find the internet connectivity to be very good. The talent pool is promising and full of potential. The employees tend to work harder and really value the job as there is lack of options in the area. However, erratic power supply is a big hindrance in Bijnore, western UP, where we have set up the center. We have 200% power backup and really not worried about power supply anymore. We just wish that some of the tax incentives available to our competitors in South India were available to us too.
YS: What is your take on the current BPO market?
KB: BPO exports are expected to reach $16 Billion, growing by over 12% over FY2011. A lot of that comprises of knowledge services segment – data analytics, data management, legal services, financial services, etc.
Domestic BPO Segment is expected to grow by 17% in FY2012 to reach Rs. 149 Billion. Using a conservative estimate, roughly 20% of the total services in the market can be catered through Rural BPOs. That pegs the current potential market size of Rural BPOs to be around Rs.30 Billion and $3 Billion for the domestic and exports segments respectively.
Given the huge potential for Rural BPOs and the minuscule revenue that they generate at present, we foresee a bright future ahead for everyone in the business. Rental costs in metros, which are among the highest in the world, are one of the biggest operational costs for BPOs besides the official cab transport provided. Attrition is another big worry.
It is due to these reasons that a lot of established BPOs have set up shop in cities like Dehradun, Jaipur, Tirupati, Karnal, etc. The key, however, for Rural BPOs will be to move up the value chain and provide value added services and not just services like data entry and data management.
YS: Where do you see yourself 4 years down the line?
KB: 4 years down the line we see ourselves as 20 center and 1,000 employees strong with expansion in the rural areas of the states of Himachal Pradesh and Uttarakhand apart from U.P, where we currently operate. We see ourselves as a key rural BPO player in the country with the services portfolio that match the urban centers and delivering quality output at a cost advantage of at least 30-40%.
The word “pivot” has indeed proved itself to be a buzz word in the startup ecosystem. Earlier in October, 2012, we saw the jobs’ site YourNextLeap, and the ecommerce player Koolkart pivot. And, now we have Sukshm Information Services!