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Companies see work-from-home as a viable long-term option if regulatory issues can be addressed

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Source: ET Bureau

About two-thirds of the 4.3 million IT-BPO workforce across the country have moved to a work-from-home model.

The lockdown announced by the government to contain the spread of coronavirus has forced employees to work from homes (WFH) for about three weeks now. This new normal might just become a standard practice, at least for some employees even after the Covid-19 situation is resolved.

About two-thirds of the 4.3 million IT-BPO workforce across the country have moved to a work-from-home model to keep services uninterrupted during the lockdown. Experts say some companies are likely to move to WFH permanently.

Nasdaq-listed BPO and analytics firm EXL Service, which has about 70% of its 32,000 employees in India, expects some of its staffers to work from home on a long-term basis. Insurance aggregator PolicyBazaar.com also sees a similar trend. CEO Sarbvir Singh says, “The current situation has paved the way for a paradigm shift. It will allow us to distribute workforce across the country.”

WFH will encourage more women to join the workforce as the hassles of travelling daily would disappear. “In the US, about 25% of the workforce works out of home,” says Rohit Kapoor, vice-chairman & CEO of EXL Service. “In India, we will move to that kind of level over time. This option will also help women, especially mothers, a lot as it will make it easier for them to join the workforce.”

Other big reasons why India Inc is seriously considering WFH as a new constant is because it involves cost savings, convenience and productivity gains, if implemented correctly. Outside Mumbai’s central business districts, a barebones office space that can seat 500 people can cost `10 crore in annual rent, which is `2 lakh per employee. Then comes the cost of staff transportation, air-conditioning and ventilation, furnishing and cafeteria.

WFH will give companies more flexibility to move according to business needs. Employees could be compensated based on transactions. “The more productive someone is, more they will be compensated,” adds Kapoor. The average cost of an employee in analytics & BPO companies is $24,000 in office, which could decline to $18,000-20,000 in WFH, reckons Kapoor.

Singh of PolicyBazaar.com says, “WFH has worked brilliantly for our employees. We plan to make it functional for at least 20-30% of our staff once things normalise.” The fully loaded cost for PolicyBazaar.com, which has 13,000 employees, tends to be around 1.25-1.5x of the employee’s salary. This money can come down drastically if WFH is implemented.

Not all companies, however, are gungho about WFH. At least the heads of two of the largest technology services players in the country have flagged up an issue.

The CEO and MD of Tata Consultancy Services, Rajesh Gopinathan, highlighted the need to restrict WFH for those who support critical and confidential functions of global clients. On a LinkedIn post, he said: “We power financial backbones of several countries, support some of the largest healthcare and pharmacy companies in the world, run technology for governments and public services organisations.”

Infosys’ CEO Salil Parekh also shared a similar concern, adding that “we continue to be guided by advisories from local governments in the 46 countries we operate in.”

Apart from security and regulatory issues, WFH also has a human challenge.

The absence of water cooler conversations, impromptu meetings and cafeteria discussions with colleagues could impact productivity. “We want to make sure we don’t lose the human touch,” says Manish Dalal, managing director, Asia Pacific, Endurance International Group, a web hosting company. “People need to meet to brainstorm. How do I create virtual mentoring sessions and imbibe company culture among people who are at home?”

A way out is to have employees come to office a few times every, say, fortnight. At Endurance, 700 employees are working from home at present.

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