Dhiraj Dolwani and Venkatesh Iyer, Founders, B2R Technologies on what it takes to create a Rural BPO enterprise?

24th Mar 2011
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B2R Technologies

BPO’s evoke images of urban settings with high rise buildings manned by urbane youth and that has been the case so far. By those standards a BPO in rural India might seem a farfetched dream but it is a dream that has come to fruition. The capable entrepreneurial hands of Dhiraj Dolwani and Venkatesh Iyer have made inroads into rural India with its first operational centre in Uttarakhand.Their business idea is that a rural BPO will not just tap into rural educated manpower but also provide jobs where none existed before.

Dhiraj Is a B.E Industrial graduate and has a M.E. Sys & Info ( BITS, Pilani) under his belt, Venkatesh is an IIM (A) Batch of 1982 graduate.

YourStory spoke to the entrepreneurial duo to gain a clearer picture of what a Rural BPO entails and their journey so far.

What does B2R Technologies  hope to achieve as a rural BPO developer?

B2R believes in "Business Ethos Rural Ethic" and we want to tap into the huge potential in rural India. Traditionally, commerce has been structured in such a way in our economy that it has created barriers to tap into this potential. B2R wants to redefine the relationship between urban and rural India by attempting to break these structures and prejudices. Rural India has formerly only been seen as a supplier of labor to urban India in offering world-class services -our business aims to leverage the potential of rural society in a manner that creates sustainable, professional and commercial capacity - in a way that does not destroy the rural Social fabric. Specifically, we want to:

1.      Make a high social impact in India by generating employment in rural India. This will provide our rural educated, unemployed youth with the opportunity to earn a viable livelihood within walking distance from their homes. We see this as our small but effective contribution to reverse the forced migration to the cities that our youth are facing as well as provide opportunities to those who cannot migrate.

2.      Create a best-in-class BPO delivery capability as the foundation stone to creating a profitable business, beginning with rural Uttarakhand.

3.      Facilitate and contribute to the integrated development of other capabilities in the villages by investing 33% of the profits (PAT) generated by B2R back into the community within these villages. This will be done using a three-pronged strategy of profit-sharing with employees, implementing projects identified by the village(s), and by contributing to community projects as needed by the region implemented through like-minded NGOs.

What are your business objectives for 2011?

On the demand side:

  • The focus would be to acquire at least 10 new clients with a mix of long-term and short term assignments to have a steady flow of business
  • Start providing services to international clients - pilot for LPO client already approved - work transition expected in Jan 2011
  • Migrating more complex work higher up in the value chain – moving from data entry (for an NGO) to MIS support within strict turn-around times.
  • Introduce innovative service offerings – a test-marketing exercise is in progress for Hosted Record Management Services – as an information archival and retrieval service for SMEs as well as large corporations.

On the supply side:

  • Launch of four more service delivery centres – location finalization for two is in progress
  • To meet the requirement for leadership roles, a development centre approach has been taken to train and develop mid-level leaders.
  • Create robust processes to deliver consistently across locations.
  • Focusing on learning and development will be key to improve delivery of services higher up in the value chain - the 1-in-6 principle established within B2R creates the framework for the team to learn & grow into more diverse and satisfying roles.
  • Scale up skill development with local NGO partners to improve employability in the region partners/NGOs. The set-up is already stabilized and we envisage it to create a ramp capacity of around 100 seats every 2-3 months. This activity has begun for the next two delivery centres already.
  • Strategic alliances to scale the magnitude of the project – both from demand side perspective as well as supply side perspective
  • Investment in long-term brand building

Mapping your Progress within the BPO Industry

B2R Technologies
  • The Indian BPO industry is expected to continue to grow in volumes as well as the value chain. The strategy needed by BPO players at this point is a combination of innovation to deliver more value and being paranoid about costs to protect India’s cost advantage. This would also necessitate expanding its delivery footprint to a new set of locations including rural sector. Rural areas would provide an attractive outsourcing destination therefore for the BPO industry primarily due to the following reasons:Less expensive labor pool
  • Increasingly deeper penetration of internet & related technologies
  • Improved literacy and English-language skills.

Apart from the export market, Indian companies are also looking to leverage outsourcing as a strategic enabler and Domestic BPO is expected to grow significantly over next few years. In a short span of eighteen months, we have been able to cross some distance in demonstrating our commitment to our vision.  Some highlights are:

  • New Clients Acquisition – We have acquired 6 new clients from diverse industry verticals and are providing them variety of services starting from simple form based data entry to complex XML tagging, EBooks creation, MIS back office etc.  Several other pilots are in the pipeline as we finalize clients’ expectations for areas as diverse as back office transaction processing for a Micro Finance Institution, objective-coding/ logical unitization for a leading LPO, Procurement back office for an IT Product organization  and record management for sales release orders.
  • Direct impact to household family incomes - Our operations started in September 2009. Since then, the monthly household income of almost 80 families has been augmented significantly. In a region which has an average household income of between Rs 1000 to Rs 2000 per month, the household income level has doubled or trebled.  The number of impacted households will roughly double by the end of March 2011. More than 50% of our employees who have led this change are women.  This is very relevant at a time when India is struggling with gender bias and trying to improve the lot of women through a combination of policies and interventions.
  • Employability & urban migration – Prior to joining B2R, several employees have worked at jobs far away from their homes in nearby towns/cities (Rudrapur, Dehradun, Haldwani, Delhi etc).  They shared that many of them could not make ends meet while working in those opportunities even when they were physically well.  When unwell, the ability to maintain a healthy life on a tight budget further accentuated their feeling of loneliness being away from their families. The women folk, even though educated, have a lesser chance to even consider migration as an option due to family and social pressures. Most B2R team members are non-graduates though even the few with a college degree without prior experience of computers, in the urban context, meant employability in low-paying jobs.
  • Indirect impact to the economic ecosystem – Economic growth has resulted in increased consumption leading to improvement in the sales of many local shops and shopkeepers – from the nearby grocery and provisions store to the local halwai (who provides tea, snacks and meals to cater to the needs of employees daily at B2R. Based on secondary research, it is estimated that for every 1 person directly impacted by employment, at least 3 others are being indirectly touched.
  • Increase in confidence of the youth and perception of the community – Several of our employees have shared that their lives have changed significantly since they began working. For some, simply the routine of coming to work every day has created a more disciplined, responsible individual - one who now commands greater respect at home. For others, the opportunity has demonstrated their abilities and given a tremendous boost to their morale and self-confidence. At a recent meeting discussion forum held between B2R, CHIRAG and village representatives (gram-pradhans and upa-pradhans), several issues about unemployment and the attitude of the youth were discussed. A large number of village representatives opined that the community is very happy that its youth has a respectable opportunity to earn their livelihood and that too near their homes – we consider this is our humble contribution to nation building.

What makes your BPO business model unique in India?

The idea by itself - of delivering business value as an outsourcing partner to corporates - together with building social value on the edifice of creating rural livelihood - is unique in that it pushes creation of more social enterprises like B2R – and thereby fosters further a new kind of ‘conscious capitalism’ – possibly a more powerful model than its predecessor with the potential to change the business and social landscape of how tremendous value can be created for all stakeholders. The manner in which we have implemented this idea

further differentiates us - Some key levers help us differentiate and create a more compelling value proposition viz.:

1.      The innovative service delivery model which, by design, delivers high quality services at a low cost footprint. The clusters of rural delivery centres in a hub-and-spoke model are of relatively smaller size built on the principle of decentralized self-reliant service centres and centralized work distribution and aggregation. The size of a centre has been designed keeping in mind the opportunities and limitations of rural infrastructure and the location of centres is planned such that employees can walk to his or her place of work. This model has been made possible because of the learnings and extensive experience of the core team in setting up and running third-party BPO delivery centres in their previous work lives. The total BPO experience of this team exceeds 30 person years and their experience overall in relevant industries is 100 person years.

2.      Appropriate elements of technology for power backup, internet connectivity and data security have been put together to create technology infrastructure in line with customers’ expectations and comparable to urban centres without the exorbitant costs that come from infrastructure components of urban delivery centres. Scaling up will leverage a robust and secure technology-based central nervous system which seamlessly connects the ‘small centres’ to build an ‘intelligently-connected large-scale service capability’.

3.      A robust set of people processes, comprising recruitment, and processes for people practices, has been created, keeping in view the local context. The talent pool is rich and vast in terms of potential. Being fresh, however, they need to be molded to the mindset of the clients they service. The design includes leveraging local partners like specific NGOs to be able to create the appropriate reach to potential candidates as well as to create an effective interview process. We are also in the process of developing mechanisms to encourage skill development in these candidates based on the outcome of the recruitment process, even if a particular candidate is not immediately offered a job. This will facilitate skill development in a broader context within the region.

4.      A traditional focus towards education has helped create the foundation of good literacy levels in Uttarakhand (72%) which are better than the national average – a rigorous training & development process has been designed on this foundation to accelerate learning & achieve performance excellence. A holistic approach to training has been taken which starts with building the need-to-learn and addressing that need in a practical manner.

5.      The operational design has being done keeping the social objectives in mind, e.g. we see ourselves moving significantly over to a 3-hour shift based work. This would provide an individual the framework and flexibility to earn in a manner that is non-disruptive since s/he could continue with other obligations or family responsibilities.

What is your long term strategy for growth?

Our fact-finding showed that replicating the urban BPO centre model “as-is” would severely impact growth, scalability and costs.  The blueprint for growth and scalability has the dual components of smaller centres (typically 50 seats) and rapid ramp-up to achieve this.  Our business plan envisages setting up 100+ centres in 7 years, thereby impacting about 6000 rural households directly.  Scalability has further been planned for in the design elements of which are captured here:

  • The hub-and-spoke arrangement is designed to address scalability by providing better management and IT support at the hubs for delivery from a “spoke”. An integral element of this approach is the “centre-creation-engine” within a hub – comprising of a team to identify suitable locations, set up requisite infrastructure and create new centres together with local partners. Once the set-up of this model is stabilized, we envisage it to create a ramp capacity of around 100 seats every 2-3 months. This activity has begun for the next two delivery centres already.
  • Creation of a self-organized, empowered team within each small (50 seats) centre is key to ensuring that each centre is self-managed and the team connected well within itself.
  • The sales engine has begun to take shape already and the work happening at B2R is the fruits of its effectiveness.
  • Scaling up will leverage a robust and secure technology-based central nervous system which will seamlessly connect the ‘small centres’ to build an ‘intelligently-connected large-scale service capability.
  • The learning design has incorporated tools and guides for the facilitator in addition to the trainee so as to support the standardization of training delivery by different facilitators across different locations.
  • Use of virtual communication tools selectively has helped create a combination of online & facilitator-led learning across different physical locations of the company.

What motivated you to set up B2R Technologies?

While adding value to oneself was possible in both options, working to create jobs seemed more relevant and personally satisfying than continuing to move up the corporate ladder. The business idea was conceived with a simple thought, that of trying to deliver business value together with social value – of not looking at CSR as an afterthought – but welding it tightly with business strategy…to create something which was of business value to corporate as well as of social value to rural India. The opportunity to implement our personal beliefs in this respect was the biggest driver to set up this venture.

What has been the greatest test for B2R Technologies ?

The overall journey so far had been quite challenging (but that’s something we always expected.). There is a huge potential that exists in the rural parts of Uttarakhand, however putting up right technology infrastructure to deliver leveraging that potential was a big challenege during the beginning. Even if the infrastructure exists, there is a huge cost & push attached to getting it activated. However, with time we have worked out alternatives and are now exploring partnerships with companies using innovative ways to address technology challenges faced in rural areas. The demand side continues to pose a challenge in respect of convincing potential customers’ – the disbelief in the customers’ mindset that such work can be done from rural locations, is slowly being replaced by appreciation of the value proposition that partnering with B2R could offer.

What do you count as notable milestones at B2R Technologies?

The biggest achievement so far had been creating the right partnerships (both with clients & at local level), putting up right elements (process/technology /business /functional) together for

o       Successful establishment of the first & second delivery centre and making them operational in a short timeframe of less than a year.

o       Setting up the centre creation engine to build capabilities to add 2 centers in every 3 months.

o       Team commitment towards work, leading into meeting strict SLAs of 99.95% accuracy and TAT of 4 hours.

o       Livelihood & employment opportunities creation for the rural youth.

o       Partnership with large organizations to provide back office services.

o       Recognition by media & various forums.

What is your entrepreneurial philosophy?

Would just like to share Mark Twain’s quote which reflects our views on this -

“Twenty years from now you will be more disappointed by the things you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.”

What accolades has B2R Technologies received till date?

got shortlisted for the semi-finals - from whom 6 finalists were selected...the criteria included carefully examining the business model and its sustainability over a period of time...

The award is a result of efforts of the B2R team and we are all happy with this recognition of our efforts... got shortlisted for the semi-finals - from whom 6 finalists were selected...the criteria included carefully examining the business model and its sustainability over a period of time...

The award is a result of efforts of the B2R team and we are all happy with this recognition of our efforts...B2R Technologies have recently won Tie-Lumis Excellence Award. The assessment was done by an independent eminent jury. We are all encouraged by the fact that there were more than 700 companies which participated – 20 got shortlisted for the semi-finals – from whom 6 finalists were selected. The criteria included carefully examining the business model & its sustainability over a period of time.

We at YourStory felt good after this interview. Both Dhiraj and Venkatesh are focused and well grounded entrepreneurs who we believe will usher meaningful changes because of the passion they bring to the table or shall we say to their rural BPO!

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