sorry! wrong newsgroup.
My mistake.
"Paramhans" wrote in message
news:1113445383.9c0729b3be704a1ce62e19858e7f4b96@teranews...
>
http://www.outsourcingleader.com/modules.php?op=modload&name=News&file=article&sid=2740
>
> Call centre theft may bust India's BPO boom
> Posted by: freshgreg on Apr 08, 2005 - 09:29 PM
>
>
> A Forrester Research report has warned that what looks like just
> another theft might curb the booming Indian BPO industry's growth by as
much
> as 30 per cent.
>
> Forrester said the arrest of three former employees of MphasiS BFL's
> BPO operation Msource, and nine others, on April 6 in Pune -- for
allegedly
> stealing over $350,000 from four Citibank customers -- has sent shock
waves
> through the Indian IT-enabled services sector.
>
> This, coupled with skyrocketing call centre attrition rates, will
> severely dampen BPO growth rates, especially in the call centre customer
> service space in the next 18 months, said the Forrester report, authored
by
> John C McCarthy, along with G Oliver Young and William Martorelli.
>
> How the theft occurred
>
> The arrested MphasiS staff members acquired the passwords to end
> customer accounts and transferred the money to their own accounts opened
> under fictitious names. The fraud occurred over a period of five weeks
from
> the end of February to early April.
>
> The fraud came to light when customers noticed the missing funds.
> Citibank then tracked the fraud to MphasiS' Pune customer service centre.
>
> MphasiS expresses regret
>
> MphasiS, in a statement issued to rediff.com, said it was working
> closely with the police in Pune and expressed regret over the incident.
>
> It is still not clear whether MphasiS dismissed the employees from
> service after the charges were pressed or whether they had left the
company
> before the fraud was detected.
>
> 'This is with reference to the Pune bank fraud case reported in
> several publications. We are in close contact with the police and are
> working with them in their efforts towards law enforcement. MphasiS
regrets
> this occurrence, which seems to involve some ex-employees. While we are
> unhappy with the incident itself, we are at the same time quite pleased
that
> detection systems worked and that there was swift, coordinated information
> exchange between the affected parties,' the company statement said.
>
> 'While such incidents unfortunately do happen everywhere, timely and
> exemplary enforcement ensures that no one needs fear that culprits or
> potential culprits can get away and the reputation and credibility of the
> entire system is actually preserved and enhanced,' the company said in the
> statement.
>
> 'We continue to work closely with the concerned agencies and will
keep
> you informed of further developments as appropriate,' MphasiS added.
>
> Blow to MphasiS' move
>
> The Forrester report said unlike past negative BPO headlines, this
was
> not a lapse of judgment or an issue of poor customer service: the incident
> was an organised and systematic plot to steal customers' money.
>
> Forrester said this breach of sensitive customer data will have
> far-reaching negative connotations for the offshore BPO space.
>
> MphasiS, said Forrester, has been 'de-emphasising its slower-growth
IT
> application development and maintenance business in favor of its BPO/call
> centre work. At best, this incident is going to lengthen sales cycles,
slow
> clients expansion of current business, and cost it new business.'
>
> Citibank is one of the firm's largest customers and if the bank cuts
> back its work with Msource, it will be a major setback, said the report.
>
> MphasiS' Pune centre was BS 7799 (a security certification) and CMM
> Level 5-certified (quality certification), theft still occurred and
> Forrester said the rising attrition rates in the call centre space -- 50
per
> cent to 100 per cent -- undermine suppliers' ability to adhere to
processes
> and sufficiently check backgrounds.
>
> MphasiS has said it will more closely monitor calls in the future to
> ensure that staff members do not solicit customers for account pass
> codes/PINs. But Forrester warned clients and prospects that 'they should
not
> be lulled into security complacency by the laundry list of certifications
or
> process changes that suppliers roll out.'
>
> Call centre growth may drop by 30%
>
> 'The incident will undermine call centre expansion by as much as 30
> per cent as security concerns, regulatory pressure, and end customer
> backlash lengthen sales cycles, impede the ramping up of larger projects,
or
> drive firms to take the captive route,' said the Forrester report.
>
> The report said the security breach will also hasten the shift from
> call centre customer service work to less onerous and visible back-office
> accounting and claims-processing activities.
>
> Forrester foresees a clarion call for robust data protection
> legislations, tighter BPO regulation and strong enforcement now. India,
said
> Forrester, will now have to tighten its data protection and privacy laws
to
> bolster its offshore credibility.
>
> Nasscom role
>
> The National Association of Software and Services Companies will
have
> to go beyond promotion and begin lobbying the government on issues like
> tightening Cyber Law -- which has not been as effective in prosecuting
> online offenses - and creating a more comprehensive system for checking
> backgrounds, said the Forrester report.
>
> Widespread impact
>
> Forrester has cautioned all IT vendors to be ready for an onslaught
of
> audits and reviews as CIOs and business executives look to reassure senior
> management that their IT work is not at risk. The report says while this
may
> lengthen sales cycles and slow project ramp-ups, it will not have as broad
> an impact on IT services as it will on BPO.
>
> Forrester expected firms to establish their own captive centres over
> which they believe they exert greater control following the theft.
>
>
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