Case study of training arm of an outsourcing firm from Kolkata while looking how training can be made part of the revenue model


We take an example of medical transcription (MT) firm Transvision (name changed) established in 2001. The promoters were already established in the manufacturing business. They initially had a modest work-facility-cum-training center at a remote area of South Kolkata. In March 2006, their 24×7 work facility shifted to a posh locality in South Kolkata. By October 2007, their training center, an important part of their revenue model throughout, too shifted along with the work facility.

It took a decade of planned work right from the creation of study materials (one-time cost) for training candidates for their medical transcription business which has to meet stringent US guidelines. What Transvision did is making training a part of the revenue model. They used to start two batches (15 candidates each batch, morning batch 8 am to 2 pm; evening batch 2 pm to 8 pm) each month charging INR 20,000 per candidate (1USD=50 Indian Rupee approximately during time frame under discussion). The six-month training was exhaustive that included typing, medical lessons, basics of computer operation, English grammar & punctuation along with sample audio transcription files for practice. In order for trainees to qualify for the job, there used to be an examination after the end of 6 months.

There were 5 full-time trainers. There were 2 full-time personnel in marketing when it comes to attracting new trainees. What Transvision did is adhering to standards which made them eligible for ISO 9001-2008 certification while expanding their business with leverage to not hire paid trainees in case they do not perform. The bottom line is that out of 15 candidates each batch, they used to hire only around 3 or 4 per batch, and given a system of an exam, no one could complain a foul play.

Let’s analyze their business model:
Monthly Income Estimate of Training Arm of Transvision
Revenue INRINRINR
No. of New Batch

2
Candidates per Batch15
Total Candidates3020000 (fee per candidate)600000
Revenue per Month600000600000
Cost
Trainers515000
75000
Study Materials3050015000
Marketing Personnel21500030000
Advertising15000
Rent25000
Other Expenses15000
Expense per Month175000175000
Monthly Income425000

It was a systematic approach right from preparation of copyrighted study materials to everything in between that gave them a good reputation throughout while building a successful BPO (Business Process Outsourcing) in transcription with most clients from the USA.

Question of Ethics

Was it fair if it was apparent right from the start of a batch given the quality of candidates that only approximately one out of 4 would be assimilated? The truth of the matter is that most of the candidates used to come from remote areas of West Bengal lacking fluency in English and use of computer like the urban counterparts. The good thing is that they still used to learn typing, basics of computer operation (again computer was still a luxury during the time frame under discussion). They now could transcribe dictations though not with 99.9 percent accuracy mandatory for Transvision in its quest to retain the ISO 9001-2008 certification. Faculties were friendly, and there used to be some sort of emotional attachment by the end of six months. So, faculties used to refer trainees who could not qualify with Transvision to other local companies. In fact, after few months, all of them used to be employed.

About Rajeev Bagra

Founder at Splendid Digital Solutions.

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