Source: E-mail dt. 5 November 2014


Culture Vs Business Process Outsourcing: A Comparative Study


Mr. C. Arul Venkadesh

B.Sc., M.B.A. (HR), M.B.A. (ED), PGDPM (IRLW).,

Assistant Professor,

 Rathinam Institute of Management,

Coimbatore, India.


Dr.R.Karuppasamy Ramanathan

M.Com. MBA., M.Phil., Ph.D., PLME(IIM-A)

Director, Nehru Institute of Technology,

Coimbatore, India.




The Concept of culture is highly significant to the service providers in this fast moving competitive planet. This job is something like selling the hollow mans intangible hat to the unknown audience which is nothing but the mode of service that has been delivered every day to the customers/clients in this business process from one end to other. BPO expects excellence in service as well as quality of work and humbleness in delivering the customer satisfaction among the end users. Business process outsourcing has undergone a huge breakthrough in today’s developing countries that gear-up the economical growth of the country as well as the empowerment of the employees both in their professional and personnel life. Many developed countries invest crores and crores of money in this process to yield endless wealth maximization in their business. In order to reach a pinnacle in business the organization need a sound and clear employees who are ready to pull out their socks and work for the company as well as their successful career, for which the workforce should retain the happiness in their work and working environment. Understanding such factor that touches them to feel that they are important and responsible for the organization growth and development will lead to create a positive vibrant among the team that will overcome the negative clouds and floods which washes out the employees out of the organization. The objective of this study is to analyze the BPO employee’s attitude towards work, working environment and their organization’s work culture barriers so as to develop the workforce to retain them back within the organization with a smile and self motivation inside and positive growth of productivity and success outside. To validate the research model, the study was conducted from 438 respondents in Tamil Nadu, India, who were working in various Business Process Outsourcing companies at various levels. Based on the previous research studies 9 constructs were selected for this study and hypotheses were framed. The research through Structural Equation Modeling (SEM) using AMOS software infers that all the nine variables are highly significant and has positive relation with the employees’ expectations.


Cultural diversity plays a challenging task in today’s competitive business world. Most of the international outsourcing companies find a multitude of inter-bridging barriers in retaining a talent, healthy and dynamic workforce. The pressure of change in demography, resulting in getting workforce and précising replacement pools, the rise in work related psychological health issues and chronic diseases, and the unity of employees with various cultural backgrounds or different needs, are only some the best examples of the challenges. HR managers have to sort it out with some firm grips with these days so as to remain competitive despite these barriers. The Companies need to implement sustainable solutions to keep their employees active and committed.   


The outsourcing concept is a main  dominant practice employed by Friedman (2005) to highlight the fact that globalization is primarily driven by the Internet, intranet  infrastructure which enables a level playing field for organizations to take strategy such as lower wage rates in the countries in which they operate in order to sustain competitive advantage in market. Identifying, maintaining, and developing the right talent is very challenging factor to business sweetness particularly in this current economy. But academic excellence and a structured C.V are not necessarily the major elements of a top candidate. It can be much more difficult l to fit him/her into the corporate planets culture, its inside values, rituals, rites, and perspectives and maintaining with a compatible personality, creativity, flexibility, and social adaptability.


Why Cultural barriers and turnover study in ITES/BPO sector?


In BPO industry many voluntary turnover become a issue for many BPOs, regardless of the job, in today’s competitive world. Such turnover is not only has an impact on BPOs but also would affect the morale of the workforce. Prior research has to identify employee’s decision to voluntarily walk away from an office. For example, a recent figure describes that it takes a company $78,000 to replace an employee (Ramsey-Smith, 2004). There have been many studies over the past 4 decades by both academicians and practitioners towards causes and consequences of voluntary turnover of an employee in BPO.


In this ITES/BPO sector, however voluntary turnover have started reaching alarming proportions. It becomes very significant to study the nature of large-scale attrition, as India houses many BPOs. Employee turnover can also leave a severe hit to the morale of the workforce that makes up additional pressure or stress of workload until the seat has been replaced. Such issues add up stress levels. Therefore, if turnover of workforce is not managed properly it will affect ITES/BPO sector adversely in terms of personnel costs and  their liquidity position.




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