Like other BPOs, eTelecare suffers from a high employee attrition rate. Among workers who completed the training program, 6.7% leave every month in the U.S. branch and 1.7% in the Philippines. The ability to attract and retain qualified people is especially crucial for eTelecare since the quality of service is its main selling point.
The BPO business is highly competitive, and new players continue to spring up. Since cost-cutting is the main reason for their existence, there's always pressure on margins. The competition also extends to the search for workers, who are in a position to demand higher wages as their number of potential employers goes up.
The article suggests ETEL will do well:
Last year two BPOs, WNS Holdings (WNS) and ExlService, (EXLS) pulled off successful initial public offerings. Both of them are Indian. ETelecare will test Wall Street's interest in a slightly different model, based on offering higher-end, more sophisticated telephone services. The firm does this not only through its choice of country, but through its approach to training, managing and quantifying employee performance.
"Although business processing outsourcing is not a new concept, eTelecare Global Solutions . . . has changed the methodology and dynamics of this type of business," wrote Scott Sweet, principal researcher in IPO Boutique, in a report on the company.
Just don't mind the error in the description of Alfredo Ayala, which confuses him with Jaime Zobel de Ayala:
THE MANAGEMENT
Alfredo Ayala, Chairman
He's been chairman since 2000 and was CEO from 2004 to 2006. Currently, he heads Ayala Corp., a holding company with investments in various businesses, and is CEO of Ayala Corp. subsidiary LiveIt Solutions. He holds an MBA from Harvard Business School.
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