BPO Strategy Consulting

The top priority of every company today is managing operating costs. Lower costs mean higher cash flows. Process cost management gives companies the flexibility to be the price leader, to spend on new products, and to offer better customer service. How does one develop a competitive cost structure? One emerging strategy is business process outsourcing (BPO).

Business process outsourcing (BPO) has migrated from being a functional issue to a boardroom topic. In fact, many companies are beginning to establish a senior executive position (CxO) responsible for process outsourcing strategy and execution. The questions that this manager is addressing include:

• How does my firm go from outsourcing manufacturing or software development to business process outsourcing?
• What processes in my firm are good candidates for business process outsourcing?
• If we execute our outsourcing strategy with an offshore vendor, what are the opportunities, pitfalls, and challenges?
• What is the business case for outsourcing services?

Based on customer demand, we offer two consulting services in this area.

Strategic Assessments
Is outsourcing right for my organization? This consulting service gives clients a comprehensive understanding of their IT outsourcing, application development and maintenance, and business process outsourcing initiatives, such as finance and accounting, CRM, HR, and document processing. Focused in scope and taking an average of eight weeks to complete depending on complexity, these strategic assessments utilize ebs research to answer the following business-critical questions:

• What is the cost of the current process-delivery environment?
• What is the strategic value of each process to the enterprise (core versus noncore)?
• What opportunities will enhance efficiency?
• What are some actions required to lower current costs?
• What are the potential risks and benefits of each action?

The outcome of this engagement: detailed insights that help organizations assess where they are, where they could be with outsourcing, and what the right business model is to get there.

Vendor Sourcing and Selection
Once you have decided to outsource your IT or business processes to a third party, the next big step is selecting a vendor. Selecting the right vendor for a long-term relationship is a critical task. A well-organized vendor selection process can take anywhere from six weeks to six months. Onshore, nearshore, and offshore vendor selection is a complex, multistep process that involves the following:

• Define detailed business requirements
• Define business/delivery model
• Develop RFI, RFP documentation
• Evaluate and select vendors
• Conduct due diligence including management interviews and site visits
• Finalize operating model
• Create governance structure
• Negotiate contract and service level agreements

Vendor sourcing is complicated by the fact that there are different vendors for different processes. According to our estimates, there are more than 2,000 offshore vendors in software development alone. That’s an awful lot of vendors to sort through. To help you navigate the decision process, we’ve created models, databases, and toolkits that accelerate the decision process.

Why ebs?
We have conducted and continue to conduct in-depth research in this area. Some of our research has been published in the form of the best-selling book: Offshore Outsourcing: Business Models, ROI and Best Practices.

To learn more about BPO Strategy Services, contact us.