A DELOITTE survey of 100 of the world’s largest financial-services companies indicates that these companies expect to transfer an estimated $356 billion of their operations and two million jobs offshore over the next five years to reduce costs, and the most likely beneficiary of this move is India.

Falling in line with such a trend is Prudential Process Management Services (India) Pvt Ltd (PPMS), the fully-owned subsidiary of Prudential plc, UK. The company opened a $10-million centre in the suburb of Powai in Mumbai last May and is poised to boost its employee strength in three months to 850 from 628. It has been necessitated by a number of projects that the company has taken up for the parent company. In a chat with eWorld, R.K. Rangan, Managing Director, PPMS, talks of the company’s present and future plans. Excerpts:

Rangan says Prudential’s decision to outsource its back-office operations was opposed by the unions. However, despite protests, the company has set up business process outsourcing (BPO) operations in Ireland, Scotland and London, besides the Mumbai facility.

The Indian subsidiary was set up in an effort to cut costs and adopt customer-friendly solutions, as the financial services business transformed itself from one based on personal interaction to the online mode. Says Rangan: “We do not call it outsourcing to India. The unions have been kept in the picture from the start. There is a struggle, but we have assured our staff that they will be helped with jobs.” He clarifies that not all the jobs have been lost, as staff are being redeployed wherever possible.

Besides, quite apart from the cost advantage, outsourcing was also necessitated by a real shortage of skilled workers in the UK and the US, he says. Prudential plc is just one of the global brands that is outsourcing operations. Other multinational corporations such as GE and American Express have also set up large service centres in the country. There are a number of reasons for the trend among MNCs to set up subsidiaries, the most important being the need to maintain confidentiality. A fully-owned subsidiary also allows for flexibility of operations. Further, companies setting up bases in the country train staff for their specific requirements.