Teleworking in India: Pros, Cons and Scope

Introduction:

‘Tele’ means distance. The term ‘telework’, strictly speaking, thus, means ‘distant working’. In practice, however, it refers to a specific mode of distant working, whereby employees or freelancers offer their services, using telematics, on a site which is geographically separated from the main office. ‘Telematics’ refers to a combination of information and technologies which connect the computers of employees or freelancers to the computer of the main employing organisation. In the language of the emerging information society, teleworking involves working from distant premises on-line.

The emerging ‘nontraditional work environments’ also include working at a satellite office, establishing a mobile or virtual office through laptop computers and other technology, ‘hoteling’ through shared office space and the compressed work week.

This paper basically attempts to understand;

  • The concept of teleworking and its genesis in India
  • The nature of work in past, present and expected future

Teleworking Revolution in India

It is somewhat surprising that India would be the country in the forefront of back-office outsourcing. In the 1960s, when the West began exporting its manufacturing in large quantities, India was somehow left out. Then, it was first the Japanese who picked up the business, then the Koreans and Taiwanese, and finally the Chinese. And that is how it has stayed since. But, in the mid-90s, India struck back. Having satiated its manufacturing hunger, the West needed somebody to deliver its services – and it was here that India stepped in. Having missed the Industrial Revolution, India jumped straight into the Services Revolution.

 Why India?

India provides the services-hungry West with numerous smart English-speaking, college-educated graduates. The often-criticized Indian education system is now powering the services export bandwagon. Teleworkers in India are more educated and generally show a greater commitment to the job than the typical college dropout or high-school graduate who works in the industry in the West.

The other great advantage India enjoys is the quality of its technical education. India possesses numerous institutes of specialized technical learning and produces thousands of engineers, designers, technicians and accountants every year. Shipping out sophisticated back-office services makes more sense for the Western world since the wage gap between an Indian and American accountant would be more substantial than that of, say, a college dropout in both countries. The more sophisticated the operation, the greater the saving.

And finally, even the God’s favored India with her location. It has a 10-hour time difference with the US, so when the offices in the US close for the day, all the work can be shipped immediately to India, where it is now a day job for the numerous teleworkers. Probably the biggest advantage India has is its extremely low cost of services. Major multinationals like American Express and GE Capital save between 40 and 50 percent by operating out of India, even after taking into account the country’s high telecom tariffs.

The Story So Far

GE Capital put India on the international teleworking map. It is now a US$2 billion enterprise in India. American Express has also moved its back office operation to India and has one of the largest in the country. British Airways and Swissair run their frequent-flyer programs from India as well. Amazon.com sources services from Daksh.com, and even Citigroup has its own services provider in e-Serve International. The Indian IT-enabled services industry can be divided into two types of player – the captive and the independent. The captives are the wholly-owned Indian subsidiaries of multinationals. They have assured lines of business, big names to associate with and are tuned to deliver the needs of the parent company only. The independents, on the other hand, comprise a large number of small players who rely on providing services to several different Western clients on a customer basis.

In the new economy boom of the 1990s this industry went through a bubble as well. Anybody with knowledge of English, a few computers and access to bandwidth set up a teleworking business. This created huge excess capacity in the industry and has driven down prices. Medical transcription, for example, used to command prices of 12 cents per line, but now brings in as little as three cents. India has about 200 medical transcription firms, and Sanjay Jain, managing partner of Accenture India, estimates that $75-$100 million of the capacity created lies unutilized.

The business done by the teleworking majors can be classified into four broad segments. The lowest is the data entry and conversion segment. These are low-value services done across huge distances. This primarily involves secretarial work. The time difference is crucial here, as work is shipped at night from America and shipped back before dawn breaks there. This segment accounts for Rs 40 billion of business and employs 40,000 people, including 10,000 medical transcribers.

Next in the order is simple rule-based processing jobs. Here the teleworkers are required to make simple decisions on the basis of preset rules. This would include credit-card operations where teleworkers make a call on whether or not the limit needs to be extended or relaxed. Accounting for Rs 2.1 billion and employing 3,000 people, this is a rather small component of India’s teleworking sector.

The customer-interaction call centers come next. They are the mascots of Indian teleworking industry, employing about 33,000 people raising Rs 16.5 billion in revenues. Sitting in India, teleworkers give reminders to Americans on their skipped credit card payments, bills and premium and mortgage payments.

At the apex come sophisticated and valuable “expert” services that not only command premiums but also provide high entry barriers to competitors. This may include an Indian lawyer doing research for his American or British counterparts or Indian engineers designing structures for engineers abroad. These are worth Rs 21 billion and employ 30,000 people in all.

Reasons Why Telework was Invented

It was found that private and public organizations are increasingly adopting telework as a business strategy, and the reasons are given as follows:

  • Global competition and a need for 24-hour customer support, thereby improving customer service
  • Technological improvements and workers’ desire for increased flexibility
  • A need to reduce overhead expenses

The ability to attract a wider range of workers including the physically disabled, parents with young children, people with elderly care responsibilities and members of dual-career families

  • Less traffic on the roads, less air pollution and less fuel consumption
  • Teleworkers work longer hours and more days than the average employee (a 30% increase in productivity is reported)
  • Teleworkers continue to work, despite minor ailments that may have kept them out of office (an 80% reduction in absenteeism is reported) (Langhoff 1996:20).

It was estimated that one ’employee who works at home two days a week, saves a company $12000 a year. These savings result from increased productivity, reduced office space and lower turnover’ (Langhoff 1996:20). The costs of relocation, estimated at about $80000 per employee, are also avoided.

Problems with Indian System

India is country where things often just don’t work. Nobody can tell when the power will go out or when the phone will crackle and die. The infrastructure of both the power and the telecom industry is woefully inadequate and unreliable to do business. In addition, there is the usual infinite number of bureaucratic delays, corruption and red tape which surrounds every business venture in the country.

The Indian financial sector hasn’t evolved enough to create a demand for sophisticated back-office operations for the domestic market. The bulk of Indians still save their money in safe-deposit boxes. Credit and debit cards are a long way off. A very minute fraction of India is insured, so there’s no need for reminders for premium payments. Having a strong domestic demand in any industry is essential because it not only helps create competence locally but also helps amortize expenses over a larger base. In the absence of an Indian domestic market for such services, the Indian majors have to get all their revenues from exporting these services.

In addition, for India to attract teleworking business, it should be able to provide quality of service comparable to what the hubs in Ireland or the American Midwest provide. This also includes issues of confidentiality, which many operations like credit card and medical histories demand.

To overcome some these drawbacks, Indian teleworkers rely on redundancy. For example, given the unreliability of the power grid, the office of Spectramind, an IT-enabled service provider in Delhi, has two generators to back up the municipal supply and a third one to back up ther first two. Given the unreliability of the phone system, there is always a second phone line idling for everyone in operation.

The Indian teleworking majors spend large amounts of money and effort training their employees about American sensitivities and culture. The teleworking industry has also benefited from the brand image built by the Indian software industry. In fact, India’s Planning Commission recently recommended the creation of an “India Brand” marketing fund for promoting the country as a preferred destination for IT-enabled services, while also suggesting the establishment of a venture capital fund for the segment. All this may well help the Indian teleworkers graduate to the billions which their software cousins make.

How Telework is Changing the Traditional Corporate Office

For most of the past century we have traveled to our place of work. Office workers have established a common pattern of working 8 to 5, Monday to Friday. These same workers have also experienced increasing congestion which has significantly lengthened their time away from home.

Our society seems to have become accustomed to this mode of work. However, the world is dramatically changing all around us and the office paradigm is being broken by a few innovative organizations. We are on the edge of a significant paradigm shift towards a new definition of work time and place.

Telework, the concept of regular employees performing their regular job from a remote location, is starting this shift to the new office paradigm. Telework, also known as telecommuting, allows employees to work from their own home, a telework centre in their neighbourhood, a vehicle, a client’s office, or wherever. In essence, the telework concept uses information technology to bring the work to the worker instead of requiring the worker to travel to the work.

Teleworkers typically work from 1­3 days per week from their remote location. They use basic technology such as a personal computer, modem and telephone to stay connected to their regular work location. Employees who have a job which can be performed remotely a few days a week, have the personal discipline to work at home and have managers who are comfortable with managing by results are generally successful at teleworking. However, organizations need to recognize that telework is not suitable for every employee, job or manager.

To be Precise

Past: There was a time when work in India essentially meant going to an office each day and working for a specified number of hours. The hallmarks of a good job in those days can be summarized by the three Ps:

  1. Payment based on the grade of work – All employees in a particular grade were paid equal salaries. There were no or minimum incentives for better work.
  2. Promotions based on seniority – All promotions were based on seniority. Talent or higher productivity played no or minimal role in the promotion of an employee.
  3. Pensions provided on retirement – The concept of working hard during youth, retiring gracefully at a certain age, and living peacefully in old age on pensions was the norm of the day.

The major features of this work scenario were total lack of competition and workplace stress, more time for family and friends, and therefore, lesser number of blood pressure and heart attack patients. But due to the hugeness of the base of educated youth and the scarcity of such jobs, unemployment became a serious problem to be reckoned with.

With the rise of private companies in India, this definition of work changed. Private companies offered much better pay scales, but for correspondingly more hours of work. Promotions became dependent on talent and how hard you worked.

Most companies preferred the metros to set up bases because of better transportation facilities, better infrastructure support, and all in all better visibility. This resulted in increased transportation costs, pollution, overcrowding in big cities (remember the films showing families living back-to-back in dingy old flats of Mumbai), reduced time with family and friends, stress, and an increase in the rates of divorces, suicides, and health problems.

Present: The IT boom of the late 1990s and the early 2000s truly upset the apple cart. The shock waves that originated from this boom penetrated every nook and cranny of the Indian work fabric, creating a revolution in the way we define employment, and changing our work culture (perhaps, forever).

The information explosion that was the key result of the advent of the Internet affected everything from the work culture of multinationals to the daily timetable of a lay farmer in a remote village in India. This infiltration was so complete and absolute that with or without the economic recession, there is no going back. The major features of the work culture introduced by the IT boom include: More pay for more work, more pay for better work. The younger you are, the better you work. Embrace change: Jump companies and opportunities.Talent pays, hard work pays, but seniority does not pay.

The following scenario describes working life in present scenario:

  • In 2010, everyone has access to cheap high-speed communications networks and can use these networks to connect with people and/or do business.
  • New (virtual) organisations and communities have sprung up on the Web, allowing everyone to trade and to share information and common interests. Most commercial activities are carried out on the Internet (E-commerce).
  • Careers change even more often than now, and people constantly have to up-date their skills through life-long learning.
  • All organisations are changing the way they work and trade. Patterns of work have changed and most people are able to choose when and where to work. Teleworking is an accepted way to work

Transition to the Virtual Office

The office workplace is in a state of transition from the traditional office to the new virtual office. The traditional office has been designed to house the majority of the office workers with workspaces designed for “heads­down” work along with spaces for team interactions. The traditional facility is typically in defined business districts to which employees must commute. The space and furniture in the office is more related to status than to actual need. Though we have attempted to make these traditional facilities more flexible, they still exist within the paradigm of assigning an employee to a workstation to use every work day.

The virtual office concept is starting to become a reality. The virtual office does not mean the elimination of the traditional office structure but rather a change in how and where we work. The virtual office now includes the employee’s home office, neighborhood telework centers, vehicles for mobile workers and the traditional central office. Employees in the virtual office environment tend to do their “heads down” work in their telework location and utilize shared office space on the days they work in the central office. The space and furniture in the central office will, therefore, be based on the specific needs of the employees on a specific day.

The virtual office concept will mean changes to your corporate real estate holdings and how you design your facilities. The real estate changes will include the use of telework centres and the possible down­scaling of your central facility. Telework centers are small office facilities which are located within or in close proximity to the employee’s neighborhood. Employees can walk, bike, bus or take a short vehicle trip to the neighborhood telework centre to work 1­3 days per week. The telework centre will be a quiet workplace designed for “heads­down” work. These telework centers could be located in non­traditional office locations such as shopping malls, commercial strip malls, part of local recreational facilities, etc.

The central office structure will still be a vital aspect of the virtual office concept. The central office must, however, change internally. Some portion of the facilities will have to be changed to accommodate space sharing by the teleworkers. This space sharing can be a significant challenge for many organizations, so careful planning and analysis is critical. Many organizations are developing a “hoteling” type approach to space sharing where employees book a workspace for the specific days they will be in the office. This approach allows employees to select the workspace which is most appropriate for the work they will be performing at the central office.

Another significant change to the central office will be in the number of meeting rooms required. Most teleworkers perform the majority of their “heads­down” work on telework days and do their personal interactions on central office days. This will require more meeting rooms than most organizations have today. In fact, many teleworkers may only need a very small workspace in the central office as they will spend the majority of the central office time in meetings.

The most tangible financial benefit of teleworking comes in the form of reduced real estate costs. In order to achieve this however, an organization must have teleworkers share space. The organization must also have enough employees’ teleworking to accommodate the space reduction goals. For example, an organization with 1% employees’ teleworking will be unlikely to realize the benefit of reduced space costs. However, an organization with 20% of its employee’s teleworking will be able to realize significant benefits.

Conclusion

Teleworking is made possible by the digitalization of information.

An increasing number of jobs are, in the broadest sense, concerned with the manipulation of information. This is true not only of the service sector but also in manufacturing, where less and less of the value of goods and services comes from the material aspects of production.

“Over 50 per cent of the market value of a car is related to its ‘information’ content – through research, design, production and retail management. Even for a packet of pasta, most of its retail value is information related. In terms of their market value, most products can be substantially dematerialized.”

In this scenario, there is continuing growth in the ‘knowledge economy’, with major investment in, and return from, service organisations. In this future, partnerships are the key – between businesses and governments, and between individuals and organisations. This world is characterised by Charles Handy’s ‘portfolio workers’; self-directed and flexible workers who have enriched job opportunity and motivation. These workers provide effective resources to cost efficient businesses, which are able to staff up according to need, whilst the workers seek performance related pay and frequent opportunities for change. In this world, the organisation sees its people as its key resource, but not as its life-long partners. With the support of governments, organisations will form teams and networks across time zones. Work will be distributed by and large across cities, as major centres of population, but will also be accessible to a degree in rural areas, where infrastructure development will create new opportunity. The prosperity of this future will not be shared by all. Those who lack access to technology, and therefore to knowledge, will be excluded from the new job opportunities. There will be increased differentiation and isolation for those members of both local and global societies. Where there is capability for transfer of work, at short notice, across regional and global boundaries, there will be increasing competition for available work, both at individual and global levels.

The facilities implications for this scenario are characterised by user-responsive, adaptable environments, which will be attractive to those whom the organization wishes to attract, but which will be rapidly changed, or disposed of, when business change so demands. They will be both efficient and effective, and will meet both objective and subjective quality criteria for the organisation and for the users.

In this future, there is almost infinite growth in the service economy. With unlimited access to knowledge-based work, the power lies very much with the individual, and is

well distributed across society. Businesses support individual choice in terms of where and when people will work, whilst people attach much greater importance to choices about their enabled lifestyles beyond the workplace. As people seek locational and time freedom, the ‘workplace’ is characterised by where the people are. Technology is of far greater importance than buildings. Jobs are dispersed across urban and rural communities, with those who choose to live outside the city centres no longer electing to spend large parts of their lives commuting into them. For those who choose to live in the remotest of locations, technology provides access to the knowledge economy, and the scale of that economy provides access to employment.

Whilst there is, in theory, opportunity for all, this is seen only in first and second world countries. Third world countries are left largely to fend for themselves, in a world which is dependent upon different technologies, and which exists in a different economy.

In this future, the facilities implications see a change in focus from large buildings and mass transit transport infrastructures, to rural regeneration, and distributed populations and power. With limited need for large capital investment, and with flexibility of its relationships with its people, business sees costs reduce, whilst productivity increases. Facilities are more ‘virtual’ than ‘concrete’, but those that are physical will be of diverse form, an expression of the ‘self-actualization’ needs of the user.

Here is a future in which power is great – but only for the few. Knowledge is tightly controlled by the elite portfolio professionals, and by the few transnational corporations which control the global economy. Governments have little or no control over these businesses, which can move capital and employment across the globe in an instant. There is unlimited organisational choice in the selection of a mass of low cost, late night workers, who have no access to the organisational systems, beyond the dumb terminal on which they process standardised transactions.

To business, reduced cost is primary, and the organisations have moved to a Foucauldian extreme – beyond control of the body to control of ‘the whole person’. In this highly segmented labour market, ordinary people queue for available jobs, both physically and electronically. As businesses move capital to suit their own needs, governments see reduced tax income, and investment in social infrastructures declines. Here is a world of vast empowerment – but for very few people. The facilities implications of the Bladerunner world are stark; a world of low cost, mass transactions in structures which are as temporary as the jobs they accommodate. The major investment is in large-scale, central processing of knowledge, with distribution of dumb terminals and controlled access to knowledge on a ‘need to use’ basis.

The Debate Today

Arguments to support telecommuting as the future of work in India include:

  • ‘Work is something you do, not something you travel to’: Save the travel expense and time.
  • Time and distance matters no longer: Work for anyone anywhere whenever you want to.
  • For the elderly: Talent is the only thing that matters. There is no retirement age.
  • For women: It offers excellent opportunities to Indian women who are unable to pursue careers outside their homes.
  • For the disabled: Physical disabilities do not deter you from realizing your potential.
  • For the employer: No need to set up huge offices having the latest facilities. All employees are happily working from home, even during holidays.
  • Paves the way for a cleaner, healthier India: No need to travel to work, i.e., lesser pollution, more fresh air, better health for everyone.
  • Stay anywhere and work for anyone on the planet: Curbs the sky-rocketing property prices and overcrowding in and around the IT hubs of India.
  • Live fuller lives: Find time for everything you ever wanted to do.
  • Do your ‘homework’ and get paid for it: Work at home (WAH), acquire experience, and expand your career arena.

Major obstacles in switching to telecommuting are following:

  • The greatest argument against this style of work is that it causes individuals to shrink to their own space. Gone is the camaraderie of the workplace where you can sit around a cup of coffee and chat.
  • Until you build an employer or an employee base, there is always the chance of people not appearing to be who they are on the Net.
  • There is the chance for the ‘out of sight, out of mind’ syndrome.
  • Management and training of telecommuting employees need to be thought out carefully.
  • Sophisticated technology required for telecommuting work of delicate nature such as those related to space research or defense is still to be developed.
  • It must be understood that telecommuting as a way of work involves changes in the outlook and mentality of the workers. The concept that a lucrative job means wearing a tie and driving an expensive car must change.

Bibliography

  • Huws, U., Korte, W. B., & Robinson, S. (1990). Telework: Towards the elusive office. New York: John Wiley.
  • Gurstein, P. (1991). Working at home and living at home: Emerging scenarios. The journal of Architectural and Planning Research, 8(2), 164-180.
  • Martino Di, Vittorio; Wirth, Linda, Telework: A New Way of Working and Living.
  • Hoffmann E.C.,Farrell D.V., de Klerk G.J., , ICT, virtual offices and flexible work options: marketing and implementation strategies, Vol.6(4) December 2004
  • Mitter, Swasti, Economic and Political Weekly, June 24, 2000, Teleworking and Teletrade in India Combining Diverse Perspectives and Visions
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About sadianasr

Road safety x digital, social, policy, media at SaveLife. AIR, Urban Justice, CAIR, ICGC, UNDP alum.

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