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RPO is BPO industry's new billion-dollar-baby

August 24, 2007 17:01 IST

High attrition rates may be a blot on the great Indian BPO success story, but this problem has helped spin off a niche industry -- recruitment process outsourcing -- which is expected to grow by a billion dollar this fiscal to about $3.5 billion.

The industry is set for rapid growth with a large number of companies in India and from abroad seeking to outsource their hiring-related jobs to third-party vendors here in order to save costs as well as time.

"India has been a hub of global outsourcing activities and RPO is the sunrise segment in this sector," hiring industry umbrella body Executive Recruiters Association's Executive Director B R Muralidharan told PTI.

"In India, RPO is already a 2.5 billion dollar market and is expected to grow at a rate of 30 to 40 per cent during

this financial year," he said.

This new buzzword is already enjoying taste of success with a number of corporate giants adopting the RPO model for their hiring needs inside and outside India.

The hiring needs of British mobile major Vodafone is taken care of by RPO provider Alexander Mann Solutions, which also handled accounts of clients like Credit Suisse, HP, Prudential and Capgemini.

Closer home, the BPO arm of the country's third largest IT firm Wipro has outsourced its recruitment process to MeritTrac and aims to reduce its hiring costs by 15-20 per cent by this move.

"Right hiring is the first and the most important step toward reducing attrition. Our objective is to move to a 'hands-free' recruiting process and this is the first step towards it," Wipro BPO CEO T K Kurien said.

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