BPO: Value in Specialization

From a customer's perspective, value includes direct or indirect impact on
the business like revenue and profitability. This includes, high-end initiatives
like redesigning underlying processes, customer data mining, statutory reporting
and inbound sales. The value chain is an ecosystem of several factors like
knowledge, market forces, skills, criticality, impact, and time.

The
value chain lies between the buyer needs-current and future-and vendor's
capability to satisfy them. Vendor's value addition stems from his knowledge,
delivery capabilities and resources-initiatives that exceed customer's
expectations of the process and bring him additional benefits. The client values
benefits that impact his business, and he agrees to pay for it. The vendor then
creates value as a new process for the client based on his capabilities and
client's requirements. Once this is achieved, the service provider partners
with the client to migrate this new process to bring in more benefits. Value
delivery models can be across multiple functions or processes, or across a
process by vertical or function. The BPO industry is getting more and more
knowledge based. This change has also positioned the Indian service providers to
assume a lead role in the drive to take customer experience to the next level.
Outsourcing projects are no longer executed with the offshore partner taking the
back seat. BPO outfits today, act as consultants and work jointly with the
clients to determine outsourcing opportunities, models, knowledge transfer
plans, critical to quality measures and other migration essentials,
demonstrating a clear shift in their role. Their demonstrated expertise has
allowed them complete control of the operating strategy, though transparency is
still desired. Activities considered for offshoring are moving up the value
chain and are touching core functions. The higher-end functions being performed
offshore these days include highly analytical processes, information research,
financial portfolio analysis, customer data mining, statutory reporting, and
inbound insurance sales, among others.

Among this emerging trend of value creation by service providers,
organizations have realized more benefits from offshoring. Today, at the client's
end, this value addition is key to service provider selection and management. At
the service provider's end it would call for identifying the appropriate value
delivery model, investments in innovation, and managing revenue impact of value.

PV Kannan co-founder
& CEO, 24/7 Customer