Giving The Client Total Control And Making The VE Office Their Second Office In India Is Our Biggest USP

A Q & A session with Narinder Singh Mahil, MD of Virtual Employee Pvt Ltd, India, reveals the company's core strengths and strategic growth plans worldwide.

Please give an introduction to your business
VirtualEmployee.com is about a different way of outsourcing. The common perception of 'outsourcing' is that projects are outsourced to outsourcing vendors here in India on a time-bound basis. These projects are completely owned by the outsourcing vendor and then handed back to the client once the work is done. But there is a lot of other work that cannot be outsourced as mere time-bound projects. For instance, the day-to-day tasks like accounting, data entry, data base management, and the like do not have a shelf life. They are ongoing tasks and they simply cannot be outsourced as mere projects. I want my company to cater to the largely untapped segment of small and medium scale enterprises (SMEs) where work cannot be merely outsourced as projects but must have eye to eye contact with the employee.

Having said that, I would like to say that  software development outsourcing is what we are most involved with.

How exactly is VirtualEmployee.com different from others?
I think two of our greatest USPs are: (a) providing direct interaction between our clients and their virtual employees; and, (b) making our office the client's second office in India.  

With VE, it is the client who is in control of their virtual employee(s) and our managers work on behalf of the client to manage what then becomes the client's second office here in India.

So, with VE, a client can achieve something that they cannot achieve with others, namely, employees who work directly for them. It is not just about project outsourcing. VE is like an extension of the client's office here in India. The client has all the control over his employee and VE merely provides all the hardware, technical and HR support to ensure a smooth working relationship between the two.

Give us a brief description about yourself
I was 14 years old when my family moved to the UK. My father, Dr. Surjit S Mahil, was a professor in Computers and Control Systems in Purdue University in the USA. Being very close to my father, the talks at home almost always revolved around the topic of computers. One can say that my upbringing took place in the exciting world of technology and computers. For the past 36 years, I have lived partly in the UK and the US, working in the IT field. So, you can say that it has been my domain, my field of expertise. I am well-versed with the latest trends in the arena of computer technology and how IT is poised to change how the world sees and does things and in fact, the very manner in which companies and organizations (big, medium and small) conduct their businesses.

Why has India become such a world leader in outsourcing?
India has the second highest English-speaking population in the world after the US. Secondly, education is a top priority among Indians and education level is very high among Indians.  India has more engineers than what the whole of Europe has. Indians shine in the field of IT and we get very good and positive feedback from clients who outsource IT-related work to us.

How did the idea for your business come about?
I was aware that India abounded in talented, abundant and cheap labour, and although outsourcing was already going on, I wanted to make it work in a different way. I could see outsourcing had not fulfilled its potential, particularly for SMEs.  You have very large Indian outsourcing companies that basically cater for the large organizations in US/ UK. You also have freelancers who cater for the very low-end market like doing small projects for the individuals or professionals. But there is no one to cater for the the average SME's 10 - 100 employees. These companies can't just get the work done from freelancers and they cannot afford to go to the large Indian outsourcing companies for two main reasons: they are very expensive; and they manly do project outsourcing.

We created a different business model where we can afford to make it cheaper for the SME by providing direct control to the client and we do every thing project outsourcing don't do.

Think of it in another way.

Outsourcing happens because Indian companies have access to low cost professionals which their counterpart foreign companies don't have. Indian outsourcing companies take the project, add their profit margin and complete the project.

This involves very high cost of transferring knowledge of the project to the Indian company. We, on the other hand, don't incur this cost since we directly provide the employee to the foreign company. This creates a win-win situation for both the parties.

So, what the client pays for is basically (i) the employee salary, and (ii) the highly economical cost of the office.

That's how the idea of a virtual, dedicated, full-time employee took birth. A company would not just have work outsourced at an affordable rate, they would also get the complete offshore package.
 
How important have good employees been to your success?
Employees are the most important component of our business model. Without good employees, there can be no VirtualEmployee.com.

How do you build a successful customer base?
Customer satisfaction is obviously crucial to the success of any business. Our aim is to provide top notch service at affordable rates. I can say that we are on our way to achieve this.

Secondly, we pride ourselves on our ability to ensure data security for the client.  We use visualization for client data security. With some clients, we work on their servers or we set up our own virtual servers in the UK or the US as the case may be. This ensures that the data does not leave their respective countries. In addition, there are logs maintained for every employee who enters the premises and these are sent regularly to the respective client for them to check the attendance etc. In this manner, the client always has all the control over his particular virtual employee.

Plus, we make sure that we meet all the requirements of the client as best as we can.

What initiatives have you taken for customer satisfaction?
We are trying to hand over as much control over to the client as possible to make them feel that they are interacting with a locally employed employee in their physical office back in their country.

Our initiatives for Video Conferencing are already paying off as clients seem pleased with the elimination of the perception of geographical and tome barriers. With our state-of-the-art video conferencing facility, a client can interact face-to-face with their employee as though both were sitting across the table from each other.  

What is your understanding of customer expectation?
Well, we work with companies from the US, UK, Europe and even Australia. Our experience has been that clients from these countries have very high expectations and that is exactly who we are here for -  to satisfy this demand. However, since I have personally lived almost my life in the UK and the US, I feel that I have a better understanding of their mindset and what they really expect from VE.
But every customer naturally expects that outsourcing work to us in India will yield great results – skilled professionals at low cost.

What, according to you, are the major challenges for the outsourcing industry today?
Well, I can't answer for everyone but within our market of outsourcing, I would say that educating clients about outsourcing is one of our biggest challenge. A lot of clients are poorly informed about outsourcing which is why they have misconceptions about it. They make wrong assumptions, have wrong expectations and, basically, end up outsourcing in the wrong way. They often partner with the wrong vendors and and thus their outsourcing fails and everyone gets a bad name. The biggest challenge within our sector of outsourcing is to educate clients and give them as much information as possible. If clients are well informed then they can achieve 100 percent success every time when outsourcing. It is when they are ill- informed that things go wrong and they partner with poor vendors that ultimately leads to failure. If we can show clients the ground reality here in India then maybe they can make the right decisions everytime they decide to outsource.

Secondly, there are always rouge vendors that seek to capitalize and take advantage of clients for whom cheap costs is the biggest deciding factor in outsourcing. These rouge companies make life hard for companies like us – clients don’t realize how much extra they are getting with our service. But they just compare our prices with these rouge vendors, often not realizing that these rouge vendors wont even have office premises.

What are some of the reasons that outsourcing fails?
As I have said, lack of correct information on the client's part leads them to make the wrong choice of the outsourcing vendor and this is one of the biggest reasons why outsourcing fails. Some clients outsource with the cheapest vendor they can find. So what actually happens is that clients outsource with the cheapest company they can find thinking they are going to make a huge saving. But even if you outsource for $100 and if you get nothing in return you have not saved anything; on the contrary, you have lost $100.
Secondly, freelancers do end up giving a bad name to outsourcing, which is why our business model is proving to be successful. Our virtual employees are dedicated, full-time employees who work exclusively for only one client and on a long-term basis. Accountability is high as is client-employee interactions. When these issues are grey areas, that's when outsourcing fails.

What communication issues can arise with an outsourcing solution provider?
Communication issues can arise if the at the time of signing an agreement with the outsourcing vendor things haven't been clearly spelt out from the outset itself. This includes nature of work, work expectations, employee expectations, and duration of the work and so on. We have a contract with the client that leaves no room for any such ambiguity.

What’s the best way to achieve long-term success?
Simple. Provide the best possible service to your client.

How do you go about marketing your business? What has been your most successful form of marketing?
Internet marketing has been a core component of our online marketing strategy but we are exploring other avenues now as well. One thing in the pipeline is for my son (who is also one of the Directors of the company and is based in the UK for most part of the time) to personally meet clients face to face. He moves between the UK and India at the moment. So we are exploring the possibility of him going out to meet the bigger clients personally in the US, UK and Australia and explain our unique business model to them.

How do you define success?
Real success would be if our model is bigger than that of Indian giants like TCS, Wipro and Infosys put together. Real success would be when VirtualEmployee.com's employee strength reaches thousands, if not millions!

Where do you see India as an outsourcing player ten years down the line?
Outsourcing will continue to grow. And although Indian salaries are going up and the gap between our salaries and our western counterparts will narrow down, India will retain its no 1 position. The service level will increase and the exposure to Western interaction that the Indians have will give us an advantage over other destinations. Also there is a huge untapped market yet - KPO fields such as accounts, law, engineering etc.. The cost saving in these fields will be more than even in IT fields because IT salaries have increased faster due to outsourcing. Indians are no less capable in engineering, law and accounts than they are in IT; its just that the market has not truly opened up yet – but it will in the coming years. And due to India's high education system and English being spoken almost like the second language, they will be in the best place to take is as opposed to other countries.

I want others to replicate our model so that the West realizes that this is the only way that true outsourcing can be successful.