Help From Far Away

There isn't a soul in America who's more all-American than Alex. A bright, chatty college graduate, he has an encyclopedic knowledge of baseball and basketball. He loves "Friends," and if there's a Jerry Bruckheimer blockbuster in theaters, he's almost certainly seen it already. So it may seem odd that his employers recently put him through a 28-hour crash course on U.S. culture that covered some rather basic terrain--like the fact that New England is not a part of Britain. What red-blooded American wouldn't know that?

Most would--but then, Alex isn't a red-blooded American. He's the alter ego of a 24-year-old Indian named Abhinav Alexander who follows sports and Hollywood only because acting like a typical U.S. resident is a big part of his job. "Alex" mans a credit-card customer-support line for Spectramind, an Indian-run outsourcing firm in New Delhi that pays young, sharp Indian grads to adopt American personas and drudge through back-office work for corporations on the other side of the world. If you've called a help desk or had your dinner interrupted by a telemarketer, chances are you've talked to an "Alex." And you'd better get used to it.

Indian outsourcers are poised to take over America's back offices, handling customer service, telemarketing and paperwork for some of the biggest U.S. companies. Firms like GE, American Express and IBM were the first to use them. Now, half of the Fortune 500, including Microsoft, are sending work to India. Dell reportedly plans to move its entire tech-support operation there. Indian citizens have even started handling phone-based fund-raising for the Republican Party. A McKinsey study indicates that by 2008, India's "business process outsourcing" industry will take in $21 billion and employ 1.2 million, more than 1 percent of the population. For a country that embraces technology as a way out of poverty, that's no less than a revolution.

For businesses looking to cut costs in tight economic times, the main advantage of shifting grunt work to India is obvious. At Spectramind's industrial complex in dusty southern New Delhi, entry-level recruits earn $3,650 a year, a fifth of what they'd get in Europe or the United States, but a decent wage in India.

India can't provide jobs for a fourth of its English-speaking college graduates, so a call-center position may be a career, not a temp gig. Most staffers are not only well educated but highly motivated; outsourcers say they make fewer mistakes than American employees. E-Funds International, a spinoff of the check manufacturer Deluxe, claims one of its Indian operations cut data-processing errors by 90 percent. Sunil Mehta, a vice president at Nasscom, an Indian association for software and service companies, adds that his compatriots have a knack for the work. "We've been filling in forms all our lives," he says. "We're born paper-workers."

Indian outsourcing offers extra advantages for huge multinational companies like GE, which has set up its own mini-firm, GE Capital Services, to handle much of its back-office work. GECAS, as it's known, is based primarily in India, though it also has centers in China, Hungary, Ireland and elsewhere. It allows the company to operate around the clock in 24 time zones. The Indian group employs 13,000 people. With that work force and an established track record, GECAS is planning to take on clients outside GE. What began as an internal attempt at savings has thus become a business in its own right.

There are challenges facing Indian outsourcing, including cultural ones. Consider the time Spectramind's Timpreet (Timmy) Singh told an irate customer she'd be "getting her ass shortly." (She had ordered a Nativity scene, complete with donkey.) That's not the sort of problem that costs money, but those exist, too. Most call centers have to install multiple backup generators in case the electricity supply breaks off (which it often does). Local water systems can also be unreliable, meaning a call center may have to build its own mini municipal government. American call centers spend most of their money on labor and less on infrastructure; in India, it's reversed.

There's also the risk of American backlash. Companies may trumpet their outsourcing strategy to stockholders, but many forbid their call-center employees from revealing their real identities to those on the other end of the line, and native accents are pounded out rigorously during employee training. (We made several calls to help desks likely to be staffed in India. Few of the workers would answer questions about where they were.) Though there's likely lit-tle difference in data security, Americans might yet be reluctant to give their credit-card numbers to someone 8,000 miles away. More-serious reservations come from the AFL-CIO, which views foreign outsourcing as the latest way companies are taking jobs away from Americans. Spurred by those worries, New Jersey is considering a bill mandating that the state government exclusively hire U.S. residents for any new contracts, including help desks and phone campaigns.