The long-term evolution of industries has long been studied. A small market grows when competitors fill niches and primary demand increases. Innovation sparks products. Services refinement and differentiation then occurs. More providers enter the market and then, as the growth cycle matures, scale and leverage become forces for consolidation. Now joining those ranks: the IT and business process outsourcing industry.
Three recent transactions – HP buys EDS, Dell buys Perot Systems, and Xerox purchases ACS – point to a future where “one-stop shopping” indeed becomes a reality in the outsourcing market.
With IBM Global Services leading this pack of “full-service” providers, what… Read the rest
The Shared Services and Outsourcing Network announced the winners of the 2011 Excellence Awards winners for the Australasian Region.
Congrats to Infosys, which featured prominently among the winners, in two separate awards categories:
Excellence in Customer Service
National Australia Bank – In Partnership with InfosysPeople’s Choice Award for Personal Contribution to the Industry
Asheesh Mehra, Head of BPO – Asia Pacific, Japan and Middle East, Infosys
The awards recognize organizations that demonstrate leading best practices while generating measurable results in shared services and outsourcing. The focus of this year’s awards shifted from “best in” to “excellence in,” a… Read the rest
The provider’s sales team has gone, all site visits have been conducted, and the contract has been buttoned down. It has been a smooth transition; now it’s time to put offshore delivery and support to the test of meeting business demands. But, in the new outsourced environment, how do you know whether the objectives against which the provider’s teams are managed are favorable to your goals?
In outsourcing, the key raw materials are people and their abilities. Delivery teams are incentivized to control the cost of people through a series of measures. By understanding these measures, you can… Read the rest
What are the key attributes of a 21st Century Enterprise? And what will an enterprise of the future expect from its partners? As global enterprises become powerful brands, their key challenges will be demand generation, superior growth and financial performance, margins, cash flows and sustainability. Increasingly such enterprises will need to identify and focus on a set of critical core processes and rely on trusted partners to run and manage other core and non-core processes.
BPO services have matured from being a commoditized service offering labor arbitrage and process standardization to operational excellence enabled by Lean, Six Sigma, and domain… Read the rest
Cloud/BPaaS offerings are gaining a lot of attention in media, analyst, and advisor discussions. For the BPO providers, Business Process as a Service (BPaaS) seems all the more important because this can potentially drive the non-linear revenues combining tools + technologies + services.
It is a potential option but not a panacea to all issues or the only direction the industry will take. We need to make sure that we cut through the hype and stay focused on what works for the customers and build the capabilities around that.
In BPO scenarios, large clients typically approach vendors to outsource processes… Read the rest
News reports over the past two weeks highlight the movement of midsized Indian service providers, Firstsource Solutions, WNS Global Services, and Intelenet Global Services deeper into North America instead of Europe. Others are moving deeper into Latin America and China. China’s outsourcing providers are taking hold in North America. Over the years I’ve followed and written about outsourcing, I’ve pointed out that competition in the service provider landscape is good for the buyers.
But maybe not. Let’s look at the bigger picture.
When a competing provider enters a market, an incumbent provider’s customers are vulnerable. The “hunters” on the new… Read the rest
Kudos to Adrian Gonzales for his perceptive – and accurate – blog regarding gain-sharing!
Those who equate Vested Outsourcing as meaning the same thing as gain-sharing clearly haven’t read Vitasek’s book. (I have, and I’ve blogged about it before, here and here.)
And those who think gain-sharing “doesn’t work” are not correct. Here’s why.
While it’s true that some sourcing relationships with a gain-share component encounter problems, it’s usually because they didn’t structure the gain-share agreement correctly. I’ve talked with more 20 buyers of outsourcing services who, when they ran into… Read the rest
The BPO world has come a very long way over the past decade! We have seen significant change in the market, both from buyer and supplier perspectives.
Buyer requirements have evolved across the board to enhance the range of processes that they outsource and the way they structure the engagements and what they demand from a BPO partner.
Providers have evolved to keep pace with buyer interests, and in many ways have also influenced the same by creating and demonstrating capabilities that have strongly contributed to the evolution of the buyers’ thoughts.
Overall, from my perspective here is what that… Read the rest
The cost take-out initiative that companies started in 2008-09 continues as it was a multi-year program. The first tranche of savings came in from discounts from vendors. However, to get a sustainable cost advantage, transformation is essential. Without this, further cost take-out will be extremely difficult.
In addition, organizations are increasingly looking to achieve much more. Business and IT alignment, more meaningful reporting, better coordination between various departments, a reduction of the overheads associated with managing multiple vendors are some of the areas that have potential for significant improvement.
Organizations are willing to increase their discretionary spend but the expectation… Read the rest
Over more than a decade, I’ve asked hundreds of buyers of outsourcing services which means of communication proved more effective in successfully meeting their objectives: ad hoc, informal communications or formal governance meetings.
By far, the majority stated the governance meetings were absolutely essential. However, most also stated that the ad hoc, informal communications were more effective at managing issues more quickly.
When I asked buyers which method of communication was more effective in managing the relationship itself, there was a greater variance in opinion. I was reminded of this recently when I watched a program about hiking the… Read the rest
Recent Comments
“Thanks for Informative and interesting ”
“Hi, I'm here for the first time and I'd say "Thank you" for this article. At last someone launched a text ...”
“Everything in life has pros and cons. While technology is great and provided us many great things, it is ...”
“Microsoft is a great example of a company to study that has had some great relationships and some horrible relationships. ...”
“Great article, wish I could have attended the SHRM Conference. Thanks for sharing this outline, invaluable. ”
“State Street Corporation has just begun their IT transformation which included the outsourcing of the entire IT department to IBM ...”
“I much prefer informative articles like this to that high brow literature. ”
“I'm surprised it took this long to realize the upcoming change. We've been outsourcing functions at a fixed cost for ...”