India is definitely losing its edge in the area of knowledge process outsourcing (KPO) to the South East Asian markets specifically to Philippines and Indonesia which are transforming into knowledge-based economies. The South East Asian countries are encouraging skilled labour which has created opportunities for the off-shoring and outsourcing sectors.

The two main reasons for India seen to be trailing behind are the quality of the talent pool which continues to diminish. It is becoming increasingly challenging to find the right type of people for the various jobs. The other is that the  governments are making it increasingly challenging to do business in India with complex and unnecessary tax and regulatory changes that are business unfriendly and fail to provide basic infrastructure support, said Gopi Natarajan, president, co-founder & CEO, Omega Healthcare, told Pharmabiz.

From a business perspective, the opportunities are still plenty and companies need to have the right marketing and sales infrastructure to capitalize on them. India still produces a large number of life sciences graduates which are a good feeder for medical coding requirement. For the accounts receivable function, it is becoming increasingly challenging to find candidates with good communication skills, so expansion on the voice side will be a challenge in India, he added.

The year 2014 will open with two promising opportunities in the BPO and KPO space. One is the Affordable Care Act or the AKA under the Obamacare legislation that will be implemented from January 2014 in the US. The other is the ICD-10 medical coding system which is planned to be enforced from October 2014. The two legislations will  spur a lot of opportunities for companies in this space. But the big challenge for India to  sustain its businesses in knowledge process outsourcing. In fact colleges in India need to  start moulding better quality candidates, lest employable human resource availability will be a big hindrance for the business process and knowledge process outsourcing space in India, said the Omega chief.

Omega too is a key player in the KPO space. It has invested over $15 million over the  nine years and is looking to continue expanding into more facilities next year. Although the initial investments in 2006, came in through private equity infusion, there remaining expansions were funded from internal accruals. Currently Omega has three offices in Bangalore, Chennai and Trichy. “Now it has set-up a second facility which is an 800-seater capacity which is expandable to 1200. In addition, we will look for more office space beginning of 2014 in either Bangalore or Chennai. The need to increase infrastructure is to ensure that India is able to sustain its KPO/BPO business share despite the stiff competition from South East Asian countries,” said Natarajan.