Progeon, the business process outsourcing arm of Infosys Technologies, "is out of incubation," says Akshaya Bhargava, managing director and CEO.

The company, which posted marginal profits [Rs 79 lakh (Rs 7.9 million) on a turnover of Rs 12.9 crore (Rs 129 million)] in the June-ended quarter (its fifth in operation), is set to ramp up rapidly in the current year, more than doubling its staff to 2,000-2,500 from the June-end figure of 882.

According to the company's guidance, revenue in the current financial is likely to be in the Rs 75.8-85.3 crore (Rs 758-853 million) range.

The bottomline will remain positive, though marginally so as this is a period of rapid investment and expansion, Bhargava explained. Eventually Progeon wishes to maintain a 15-20 per cent net margin.

Progeon has two major focuses. One, it will focus on transaction processing, the higher value work, and not on call handling.

Currently call handling accounts for around 10 per cent of its business. This is likely to go up to to 30 per cent in two years but not beyond.

Presumably this will be one result of the ramping up of its British Telecom operations, which account for 30-40 per cent of committed business. Though the present BT work is call handling, Progeon expects to undertake more complex work with time.

Progeon's second objective is to be big and robust enough to play its part in offering end to end services to customers along with Infosys.

Bhargava cited the example of a financial customer who was offering a small part of its reconciliation work because, as it confessed, its operations in different geographies rested on different IT platforms.

The total package in such a case would involve integration by Infosys and delivery of the entire resultant process by Progeon.

To enable end-to-end delivery, Progeon is looking at acquisitions and partnerships. When it buys, it will be for people skills in specific verticals and not simply size.

In case of partnerships, the idea will be to make joint proposals to customers where process reengineering consultants will work out a new process which Progeon will then execute.

Progeon's desire to concentrate on handling processes of increasing complexity and not just individual tasks is coupled with its aim of improving customer processes.

The real USP a BPO service provider can offer is not just cheaper process delivery but greater productivity for the outsourced services through process reengineering.

The company's business approach is to target customers first, then find out what it can do for them, thereafter determine how it can be done and finally deliver.

Right now it is concentrating on verticals or businesses such as banking, securities, insurance and finance and accounts.

It wishes to expand into telecommunications and human resources. Most of the call handling business comes as part of the attempt to serve a range of customer needs.

In handling customer processes, Progeon first tries to mirror the customers' processes to increase his comfort level.

Transaction processing is all about managing customer risk perception, explains Bhargava. And the aim to make the customer feel that the outsourced facility is an extension of itself.

This results in dedicated areas for companies in Progeon. The staff in the BT area will put up BT posters, as will the Greenpoint staff, and the two will play football matches, presumably wearing the respective customer colours!