In my previous posts (http://readsoft-blog.com/where-is-bpo-heading-part-one/)on the future of the BPO market, I looked at some of the developing trends which I believe will have an influence on the shape of the market in future.
The resulting question from outsourcers themselves is of course: how can they use that knowledge to get ahead and stay ahead of the competition?
I’m going to break this down into seven key areas where I think BPOs can get a competitive edge on the rest of the industry – both today, and in the next few years.
1. Automate, automate, automate Automation is a significant cost-saver, and its importance in the competitiveness of BPOs cannot be understated. Inexpensive labor alone is no longer the single game-changer for BPO efficiency and with rising costs of offshore labor, the move towards automation of both processing and workflows is a crucial one.
2. Reacting swiftly to new regulations Regulations can be major hurdles for BPOs, and having international operations or utilizing a ‘distributed processing’ approach is something that will only exacerbate this issue. Compliance is crucial. A current example of such local regulations is the BSI TR-03138 in Germany. (https://www.bsi.bund.de/EN/Topics/Certification/TechnicalGuidelines/TechnicalGuidelines_node.html.) One means of overcoming at least some of these regulations is through certified quality assurance schemes, but these can be costly, and BPOs need to factor that in. Standardizing the QA approach following e.g. AQL/ISO rules and being 100% supported by the BPA software solutions utilized is still not realized by many BPOs. Instead individual solutions by project using merely sampling methods are utilized. Top BPOs need to be aware of not just existing regulations, but also new laws that are being drafted. In the best-case scenario, being a part of the conversations with decision-makers around new laws will help major BPO industry players have the most influence. Customers expect BPOs to act global, think local and in an ideal case to advise them on local regulations. This is a highly complex task, but it can also be a valuable differentiator.
3. Partnering with shared service centers instead of seeing them as the competition Shared service centers (SSC) should not be viewed as competition for BPOs, they should be seen as opportunities. SSC of corporations with operations in multiple countries face logistical challenges in handling the various input channels and locations. BPOs can assist by taking over these tasks and normalizing these input streams. They can add further value by either offering BPA solutions or relieving the SSC of exception handling tasks. SSCs benefit from shorter processing times and better resource control. It’s a lower cost AND, of course, they fulfill their BCM requirements by partnering with a BPO.
4. Making sure mergers and partnerships come with end-to-end control of processes between partners Mergers and partnerships between BPO providers are offering opportunities to scale up dramatically (even for short-term projects), and can bring many benefits. However, in order to realize these benefits, a key factor in the success is how well the two organizations can merge – particularly around process control. A solution such as ReadSoft’s XBOUND (http://readsoft.com/solutions/large-scale-automation/business-process-outsourcing) offers the ability for end-to-end control and for linking systems. Imagine XBOUND as an umbrella over the partnering BPOs’ systems. The BPO who is in charge of the customer-communication can at any time (real-time) report on status and also see risks in the SLA adherence. Furthermore, setting up projects and linking the system is fast and does not impact on system performance.
5. Distributed Processing & Business Continuity Management processes Distributed processing is about operating across multiple locations, while harnessing the benefits of complete flexibility and adaptability in each location. For supporting business continuity management (BCM) practices, distributed processing offers great potential, and if BPOs can manage to integrate customers smoothly into this process for functions such as exception handling, the possibilities are enormous. In addition to that, those BPOs which have solid BCMs in place will be a more attractive proposition to customers.
6. Data protection, secure cloud services and multi-tenant systems With distributed processing offering BPOs big benefits, one enabler for this approach is cloud technology. BPOs that are able to find cloud solutions that offer high-level data protection for the satisfaction of both customers and legal requirements (as touched on above) – will be in a very strong position. Of course there are many ways cloud technology can be used and structured, and multi-tenant systems (where multiple parties share the same set of resources) is one example of an approach that offers potential cost savings. But, this must be weighed up against the data protection needs of customers. Right now it’s highly debatable whether those cost savings (for multi-tenant systems) would outweigh security concerns. ReadSoft’s XBOUND solution (http://readsoft.com/solutions/large-scale-automation/business-process-outsourcing), for example, offers a new secure room feature which counter-acts the need to set up separate networks and/or physical locations for sensitive data/customers.
7. Fast on-boarding It’s a simple point to make, but it’s still worth mentioning. Those BPOs that can ‘on-board’ new customers faster than competitors will be at a major advantage. Having the tools to do this is the key. It requires having the right processing solution and standardized processes. Increasingly, the ability to run pilot projects (‘pilot sourcing’ ) is beneficial, because many new and existing customers want to trial new solutions before a full-scale roll-out. So, low on-boarding costs are vital, and this is an area where ReadSoft’s XBOUND solution (http://readsoft.com/solutions/large-scale-automation/business-process-outsourcing) can prove very successful for BPOs.